UC Berkeley has released an update regarding the financial situation of the campus.
The update recapped both the fiscal losses that resulted from the COVID-19 pandemic and provided a general recovery plan moving forward.
“COVID-19 had a major impact on our finances, resulting in revenue losses and increased costs across the campus,” said Chris Stanich, associate vice chancellor of financial planning and analysis, in an email.
Some of the revenue losses included decreases in revenue from enterprises such as housing and dining, athletics and Cal Performances, as well as a cutback in state funding. Campus also simultaneously faced increased costs for remote instruction and COVID-19-related precautions.
To mitigate the fiscal impact of the pandemic, campus took multiple measures, including curbing operating expenses and implementing a hiring freeze, according to Stanich.
Additionally, UC Berkeley received significant aid from the federal government’s Higher Education Emergency Relief Fund, which supplied approximately $70 million for student support and $85 million for institutional support.
Stanich cited the increase in student tuition along with the state’s decision to restore funding in fiscal year 2022 and increase it by 5% as positive factors in UC Berkeley’s financial future.
The approved Tuition Stability Plan will increase tuition and fee rates on a cohort basis, remaining constant throughout each cohort’s time at Berkeley, Stanich added.
“In addition, the Regents have mandated an increase in return-to-aid on the incremental revenue from 33% to 45%, which will help keep UC Berkeley accessible to students despite these modest increases,” Stanich said in an email.
However, this tuition increase plan has been met with backlash from UC Berkeley student leaders.
ASUC External Affairs Vice President Riya Master believes the plan to increase tuition will disproportionately impact nonresident students, stating that tuition increases are “antithetical” to accessibility.
Chair of the University of California Student Association Josh Lewis added that tuition increases will have a negative impact on low-income student populations.
Lewis also expressed optimism regarding the increase of state funding.
“While (students) are conscious it isn’t enough to meet the needs of the UC, the massive increase in support should signal the willingness of the state to fund the UC, and lead UC to rethink their commitment to annual tuition increases,” Lewis said in an email.
Yet, even in wake of both increases in state funding and tuition, campus still anticipates facing financial challenges, according to Stanich.
Salaries, wages and benefits represent 63% of campus operating expenses, Stanich added. These costs will place significant strains on campus’s budget as annual salary increases are reinstated and the hiring freeze is withdrawn.
UC Berkeley’s finance reform initiative aims to reallocate resources and funds across campus and aid campus in financial sustainability.
According to Stanich, UC Berkeley anticipates returning to a balanced campus budget by fiscal year 2022-23.