State’s UC budget insufficient for increasing university expenses, Legislative Analyst’s Office says

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The California Legislative Analyst’s Office, or LAO, released a report Thursday afternoon analyzing Gov. Jerry Brown’s higher education budget for the 2018-19 fiscal year.

LAO’s report consists of four sections relating to the higher education budget, including the UC system, the CSU system, California Community Colleges and the California Student Aid Commission. Each section contains an assessment of the background and description of the proposals and provides relevant recommendations.

The analysis was released following a statement issued by the UC Office of the President, or UCOP, in January which addressed a 3 percent increase to the higher education budget proposal. The UCOP presented an optimistic outlook though it expressed concern the budget proposal increase was “less than we anticipated.”

As Brown is allocating a lower proportion of this year’s budget to higher education funding than in previous years, LAO senior fiscal and policy analyst Jason Constantouros said he thinks the budget allocation does not provide enough money to cover increasing university expenses.

Constantouros cited employee compensation and increasing student enrollment as examples of increasing costs within the UC system. The university, according to Constantouros, tries to maintain salary increases for its employees, which makes compensation a consistent cost increase.

“Faculty salaries are pretty competitive in comparison to other public higher education institutions across the country,” Constantouros said.  

The university bases its employee compensation on the compensation model used by eight other higher education institutions, four of which are private and four of which are public. According to Constantouros, however, this pool does not represent the full market.

Constantouros said the funding allocated in the higher education budget is not restricted by the state. He added that though the state legislature allocates some of the funding, the UC Board of Regents primarily decide on its distribution. The regents then divide the funding to the campuses based mainly on student population.

“There’s a lot of flexibility and control allocated to the UC system,” Constantouros said.  

Constantouros added that tuition increases and a larger nonresident student population are possibilities in the coming years. Tuition increases are voted on by the UC regents, who have yet to increase tuition for the upcoming year, according to Constantouros.

Student groups, including the ASUC, maintain that the proposed smaller percentage of the budget poses a risk to the education quality the university offers students, according to ASUC external affairs vice president Rigel Robinson.

Legislators are eager to deflect blame for our campuses’ struggles from Sacramento to UCOP, and in doing so are forcing students to foot the bill for political fights between administrators and politicians,” Robinson said in an email.

Robinson added he believes the 3 percent increase to the education budget is insufficient to keep up with the state’s demands for undergraduate enrollment growth and campuses’ increasing deferred maintenance costs.

The ASUC will continue to work with UCOP ahead of budget revisions scheduled for May, according to Robinson.

“The state, at the very least, the literal very least, ought to bump our funding increase back up to 4 (percent),” Robinson said in an email.

Contact Michele Meltzer and Rishabh Nijhawan at [email protected].