Monday, June 29, 2015

Questions about the UC Budget Deal

The recent state budget agreement has brought up many important issues for the UC system.  Here are some of my top questions:

1)   What is the current status of the deal made between President Napolitano and Governor Brown?  Did the state budget deal certify or nullify the original pact? For example, the earlier pact clearly calls for the option of new employees to pick a define contribution plan, but the state budget does not include this. The original deal also has the state giving UC $436 million over three years for the pension, but the state budget only mentions one year of funding ($96 million).  Is the deal with the governor like the deal the governor thought he had last year with UC, which prevented any tuition increases for four years?

2)   What happened to UCOP’s claim that it needed to raise tuition 5% over the next five years in order to maintain excellence?  It is clearly getting less money, and the new money can only be used to pay down the pension liability.  Was the earlier claim only a bargaining ploy, or does the UC really need more money than it is getting? 

3)   What is the status of all of the non-monetary issues (online ed, time to degree, three-year degrees, transfer rates) contained in the Brown and Napolitano agreement?  First of all, aren’t these areas the domain of the faculty senate? 

4)   What exactly did the UC get in terms of enrollment funding?  The state says they can get an additional $25 million if they promise to do many different things, including adding 5,000 additional students from California, but how did the legislature come up with the figure of $5,000 per additional student? Is this the result of UC’s continued refusal to come up with a fact-based analysis of how much it costs to educate each additional undergraduate student?

5)   What happened to all of the legislation about sharing non-resident tuition among the campuses? There was a lot of sound and fury about this issue, but in the end, it appeared to be dropped.

6)   Did Napolitano really get anything by taking on the governor in such an aggressive fashion?  Yes, she may have commandeered more funding for the pension, but at what price?  Not only will the UC have to introduce a pension calculation salary cap for new hires, but it also may end up introducing a very bad defined contribution plan that could ultimately work to defund the defined benefit pension plan and hurt the retirement of many future workers.  Also, what does it say about an institution when it leaders says don’t worry about the changes because they only affect future workers?


You can post your answers below, or email me at bobsamuels_us@yahoo.com

Tuesday, June 9, 2015

Free Public Higher Ed Goes Viral

When I published my book Why Public Higher Education Should be Free two years ago, I felt like a lone, crazy voice in the wilderness, but recently we have seen many initiatives to attain the goal of debt-free public higher education.  President Obama helped to shape the debate by promoting a plan to make the first two years of community college free. The president’s policy drew from the Tennessee experiment with free communitycollege and other similar programs that have emerged around the country.  Following the president’s lead, members of Congress signed on to a resolution to make all public higher education debt free, and presidential contender, Bernie Sanders has made free public higher education the cornerstone of his campaign.

The central argument I have been making is that our current system does not work: in the last three decades, we have spent trillions ofdollars on financial aid and higher tax breaks, and the result is that students coming from families in the top income quartile have a 77% chance of attaining acollege degree, and students from the bottom 25% have a 9% rate.  Moreover, not only have students been forced to take out over $1.3 trillion dollars of debt, but as more students go to college, the US has moved from 1st to 12th in college attainment.  

Just as many of our K-12 schools have become self-segregated by class and race, our institutions of higher education have also becomeseparate and unequal. Low-income Black and Brown students tend to go to low-funded community colleges with low graduation rates, while wealthier students attend wealthy universities with high graduation rates.  In fact, the celebrated California Master Plan was founded on a principle of hierarchy and has resulted in a system of  de facto segregation.  

In order to make higher education an engine of social mobility and not a generator of economic inequality, we have to rethink how we fund these institutions.  Instead of using an ad hoc voucher system that provides aid to individual students, the federal government needs to send funds directly to institutions with a strict set of requirements, including a maintenance of state funding, a cap on tuition and room and board increases, and a financial aid system that makes the total cost of attendance free for low- and moderate-income students.

What needs to be realized first is that no single state or institution can fix this problem on its own.  There has to be a joint federal-state-institution compact because we have aid coming from all of these different sources.  Bernie Sanders believes that we should fund this type of program through a new financial transaction tax, but as I argued on a recent radio show and on a Fox News debate, a more effective strategy would be to use money currently going to tax breaks and tax exemptions to make higher education free and accessible. 

In the current system, wealthy individuals and wealthyinstitutions are being subsidized through taxation policies catering to thesuper-rich. Not only do private universities with tax-exempt, multi-billion dollar endowments allow wealthy individuals to escape taxation through charitable giving, but these institutions run tax-exempt enterprises without paying local property taxes.  Meanwhile, wealthy individuals have turned to 529 College Savings plans as a new tax shelter

All of the tax breaks dedicated to high-income individuals and institutions help to decrease state and federal tax revenue, and this reduction of funds creates an environment where politicians can say they have no money for public higher education.  What citizens have to fight for is integrated, debt-free public higher education, and this can be done by taking on the higher ed tax subsidies for the wealthy.   


For more updates on free public higher education, click here.  

Monday, May 18, 2015

The Good, the Bad, and the Ugly Budget Deal

The deal between President Napolitano and Governor Brown is a mixed bag.   On the one hand, the plan brings more money to the system than many expected, and the governor does increase support for the UC pension plan. The deal also buys out the undergrad tuition increases for the next two years, but the graduate and professional schools fees are free to increase.  Finally, the plan allows for non-resident tuition to increase 8% each year, and the governor has promised that he will not block a legislative effort to add more money for enrollment growth.

On the bad side, the deal was negotiated by two leaders without any real effort at shared governance.  In fact, the university will still have to negotiate with unions and faculty over pension reform measures.  Like the fast-tracking of free trade agreements, this method of negotiation values secrecy over democracy.  As is often the case in the UC system, consultation occurs after a decision has been made, and this represents a fake form of democracy and shared governance.

The most threatening aspect of the plan is that it requires a new pension tier, but the details of the plan are not spelled out. A big concern is the talk of a defined contribution plan, which we have told the university is not only bad for the employees but also bad for the entire shared defined benefit plan.  History shows that once you allow employees to opt into a reduced benefit, the main benefit plan becomes destabilized.  

Attention now turns to the legislature where there are many competing plans for UC.  Just as UC employees are concerned about the lack of democracy in the Committee of Two, legislators are surely feeling squeezed out of the democratic process.

Tuesday, April 21, 2015

Does Instructional Quality Matter to the UC?

UC-AFT is currently bargaining with the UC administration over the terms and conditions of the contract regulating over 3,500 lecturers in the university system.  The majority of these lecturers are in their first six years, and according to the present contract, there is no obligation to review these faculty members.  In fact, in some programs, none of the faculty teaching the majority of required undergraduate courses have been reviewed in ten years.  The people representing the university at the table argue that lecturers should have no expectation of having a career until they pass their sixth-year review, and so it is not necessary to review their teaching and service before they come up for a continuing appointment.  Since most lecturers never make it to their sixth year, this means that the university does not think it is important to judge the quality of instruction for the majority of lecturers. 

When we have pushed the people at the bargaining table to explain why they do not think teachers should be evaluated, we are told that it would be too time consuming and costly to do the reviews.  In other words, instructional quality is such a low priority that the administration does not think it is worth the time or effort to review the effectiveness of instructors. 

As a union, we have been placed in the strange position of demanding that the university review our members as we insist on a high bar for quality instruction.  We have also been forced to develop a contract that can protect against the constant turnover of lecturers.  Since the administration does not think that these teachers in their first six years should have any expectation of continued employment, departments and programs have been able to replace experienced faculty with inexperienced teachers to prevent expert lecturers from gaining any job security.

The university also insists that lecturers working less than half time should have no benefits including social security and pension.   In fact, a majority of lecturers are now hired on a quarterly basis and have no way of knowing when and how much they will be teaching in the future.  Some of the quarterly appointments have been teaching in the UC for over twenty years and still they have no job security. 


We are proud that our contract is one of the best in the country for non-tenure-track faculty, but there are still majors problems with the way the administration views and treats the people teaching more than 35% of the undergraduate student credit hours and a majority of the required undergraduate courses. We need a contract that will protect the quality of undergraduate instruction by evaluating lecturers in an effective manner. 

Tuesday, March 31, 2015

The University for No One

In Kevin Carey’s The End of College, a liberal analysis leads to a neoliberal conservative solution:  higher education will increase access and affordability and quality by using online technology to make it virtually free to billions around the world.  Ironically, this reformation of education will be powered by high-tech billionaires and millionaires who will take control of the production of degrees from greedy public institutions.  Moreover, Carey’s “university of everywhere” would eliminate research universities, just like online media has destroyed most newspapers. In this high-tech fantasy scenario, most current academic jobs would be downsized as a single superstar professor teaches all biology students in the world over a shared online platform.

It is unclear how the research that generated all of this technology will continue to be produced since the same institutions that generate most research are the ones that will be destroyed.  It is also unclear who will assess students or answer their questions since the new mega MOOCs will be operated without human intervention.    In fact, the only way to reduce the marginal cost of adding more students to zero is to simply eliminate human labor. 

Carey’s extreme representation of higher education celebrates every billionaire investor and denigrates every current professor.  Although, one can agree with many of his criticisms of their current state of undergraduate education, the medicine is far worse than the disease.  It is also unclear who will pay, train, and house the global online superstar professors.    After all, the great courses coming out of MIT, Stanford, and Harvard are being supported by the same hybrid universities Carey wants to eliminate.  

Like many higher ed reformers, Carey appears to be blissfully unaware of the casualization of the academic labor force and the adaptation of business-oriented management and budgeting.   From the billionaire high-tech innovator’s perspective, public institutions are inherently corrupt and ineffective, and so they must be replaced by platforms driven by speed and capital.   

In response to this vision, UC President, Janet Napolitano, offered a defense of public research universities in a book review she wrote for The Washington Post.  What is curious about her analysis of Carey’s book is that she fails to take on his sustained attack on the quality of undergraduate education at research universities.  One reason for this lapse might be that she did not actually read the whole book, but another may be that she has no response.  Like so many university administrators, she rarely talks about how to improve the quality of undergraduate instruction, and when she does discuss undergraduates, the topic is almost always about tuition, financial aid, and enrollments. 


Since research universities are not making the quality of undergraduate instruction a major priority, it is easy for outside groups and pundits to dismiss the value of the entire higher ed enterprise.  As the current debates over the funding of the University of California show, higher education institutions need to examine how they can support their research and teaching missions.  This means that calls for increased funding have to be coupled with clear indications of how the money will be spent.

Friday, February 20, 2015

Is the UC Spin Spinning Out of Control?

As the state begins to examine the UC budget, two different hearings have been held to determine how the university is using state funds.  It is clear that the legislature wants to increase funding for the university, but it is also clear that the governor and the legislature want to know how the UC is currently spending its money.  There is also a growing concern that the increase in nonresident students is enhancing the funding inequality among the campuses and that eligible students from California are being shut out of the UC system.   In fact, in a hearing reviewing the UC response to a state audit on campus funding imbalances, several legislators made it clear that they are bothered by the fact that the campuses with the highest number of under-represented minority students are the campuses receiving the lowest amount of funding. (For a detailed analysis of the campus funding imbalance, see here)

At the audit hearing, the UC argued that the funding imbalance among the campuses will be resolved by the new rebecnhing funding model, but as I have shown, rebenching is only redistributing $37 million per year, and the revenue generated from nonresident tuition far exceeds the money from rebenching. After calling this enhanced imbalance to the attention of the UC administration, I was told that the smaller campuses should be happy that Berkeley and UCLA receive more funding because these star campuses make the other less stellar campuses look good.  This seems to be a novel trickle-down theory of prestige, or is it just spin?

At the same time that I have been meeting with legislators and staff from the governor’s office to help increase UC funding, while making campus funding more equitable, I have been besieged by questions concerning why the UC budget is so hard to understand.  Many of these political officials have been waiting for UC’s response to AB94, a bill that requires the UC to report on the differences among the costs of educating undergraduates, graduates, and professional school education.  This report was due by October 1, 2014, and the final report was only released the day before the state hearing on UC finances. 

In looking at the final product, one can only be shocked and amused.  Much of the report is a simple narrative discussion of all that UC does and how it is hard to determine the cost of its many activities.  When the UC finally gets to the discussion of the cost differences, the entire new methodology is explained in a single paragraph:  “First, graduate students are considered full-time when taking 12 units a term whereas undergraduates are full-time at 15 units per term. This is a standard practice in other institutions and is the basis for the ratio of 1.25 (15/12) used in the NACUBO report. Second, the University collects data on the proportion of student credit hours (SCH) offered by level and that data includes the type of instructor delivering the student credit hours. There is a substantial differential between undergraduate and graduate students in the proportion of SCH taught by ladder faculty. For graduate students, 79% of SCH are taught by ladder faculty compared to 49% for undergraduates. Since expenditures for ladder faculty are higher than for other types of faculty, expenditures by level of faculty can be used to estimate an overall differential between undergraduate and graduate expenditures. The estimate of the differential for 2012-13 is 1.33. Combining these two factors – 1.25 for the FTE calculation times 1.33 for faculty type – results in an estimate that graduate expenditures per FTE for instruction are on average at least 1.7 times greater than undergraduates." Really?!!  How in the world did they come up with such a reductive methodology and why did it take them over a year to produce it?

Although it is important to stress that graduate students are taught mostly by higher paid senate faculty, the report does not even try to say how much the different faculty groups are paid and how many courses they teach on average and what are the average size of the undergraduate and graduate and professional classes.   The university’s own rebenching formula estimates that doctoral students cost at least two and a half more than undergraduates and medical students cost five times more than undergraduates, but this report says that graduates only cost a third more and medical students cost ten times more. 

Actually, UC gives two different types of calculation for the cost of instruction: one which they call the narrow calculation and the other one is the broader calculation.  According to the narrow calculation, undergraduates cost $21,800 to educate each year, graduates cost $37,100, and health science students cost $216,000, and according to the broader definition, undergraduates cost $29,200, graduates cost $55,800, and health science students cost $342,500.  Yes, they claim it costs them a third of a million dollars to educate each medical student for a year. 

Before we try to understand how the UC generated these numbers, we should look at a few of UC’s disclaimers.  The first important claim is that they are unable to calculate the cost of educating professional school students:  “The University is unable to break out expenditures for graduate professional programs as requested in AB 94. These are programs that are authorized to charge Professional Degree Supplemental Tuition in addition to mandatory systemwide tuition and fees. Most of these programs are housed within larger departments where expenditures are not differentiated by program. There is no reliable method for delineating these expenditures on a systemwide basis, nor is there a suitable proxy to use to estimate them. Therefore, the University is unable to respond to this portion of the request.”  First of all, AB 94 does not focus on how much money the UC is bringing in per student, but how much UC is spending per student.  In fact, UC and the state Legislative Analyst keep on confusing the two issues.  For example, in the LAO’s report for the budget hearing, they have a chart called “UC Education Expenditures Per Student,” but as I have told them on several occasions, this should be called revenue per student and not spending per student, since this is just a calculation of how much tuition, state funds, and UC general funds are brought in per student: it does not actually look at how much the UC is spending on each student, and that is why AB 94 was needed.  However, UC once again repeats on page 4 of its response to AB 94 a chart entitled “Per-Student Average Core Funds Expenditures for Education (2012-13 dollars),” and they make the following standard claim, “In 2012-13, the average expenditure figures for students based on the actual expenditures for the general campus instructional program and its support activities totaled $16,890, composed of $8,360, or 49%, student fees; $2,340, or 14%, UC General Funds; and $6,190, or 37%, State General Funds.”  So how can the UC be spending $16,890 on each student, if they claim the average narrow rate is $24,157 and the average broader rate is $33,299? Is this going to help the state understand the UC budget and spending?

Confusing matters even more is the next disclaimer, which is the standard argument that all activities in the system are mixed, and so it is impossible to say how much anything really costs:  “the University’s accounting and information systems do not readily allow for the disaggregation of educational expenditures requested in the AB 94 language and funding is neither appropriated to the University of California by level of student nor by discipline, nor spent that way on the campuses. Faculty are paid to teach both undergraduate and graduate students as well as perform other functions related to the research and public service missions of the University and their salaries are not apportioned across these activities. Similarly, staff perform support functions affecting students of all levels and disciplines. These expenses are not categorized on the basis of what level of student may benefit or their field of study.”  The argument here appears to be that the university has never been asked to make this type of calculation, and they really do not know how to do it, so the whole response is just an impossible fiction.  When I have asked people at UCOP how they can make any decisions if they do not know how much anything costs, they tell me that they use historical estimates and incremental increases.

In the response to AB 94, the basic methodology for this impossible report is defined in the following manner:  “The University’s method for calculating instructional expenditures by all the categories requested is based on reasonable assumptions and proxies for actual data, which are delineated below.”  In other words, this report is based on “proxies” and “assumptions” and not on any real research, but isn’t this a research university?  After all, I and others have suggested to UCOP several different methodologies that the UC could have used to make these calculations, but they refused to listen to my advice and the advice of others.  

Driving much of this problem is the fact that the UC does not believe that the state or students want to pay for the cost of departmental research, and so they have to hide this cost by including it in the cost of instruction.   This hiding is evident by comparing three statements from the same document. The first statement clearly says that research is not part of the cost of instruction:  “These calculations leverage functional expense categories reported in published financial statements and identify expenditures that can be considered direct expenditures on education (e.g., instruction, academic support) as well as indirect expenses (e.g., institutional support, maintenance, depreciation).” Nowhere is research mentioned in this part of the report, and in fact, research is later explicitly excluded “the figure represents the estimated total funding from core funds on a per-student basis that is available to support instruction (faculty salaries and benefits, instructional support, instructional equipment and technology) and other activities such as libraries, student services, administration, and operation and maintenance of facilities. It excludes financial aid, which is treated in the standard CPEC methodology as an expenditure to support access, not as an expenditure to provide the instructional program. Health sciences instruction, research, and public service expenditures, as well as related expenses for support activities, are excluded."  But later on they say you cannot separate the cost of instruction from the cost of research: "Historically, the instruction category in the budget includes most of the direct instructional resources associated with the schools and colleges located on the general campuses, encompassing classroom and laboratory instruction, instructional technology, and joint scholarly research activities of students and faculty."  In other words, according to the same document, you have to separate research from instruction, and it is impossible to separate research from instruction.  


All of this confusion came to a head at the recent hearing on UC finances that you can watch here.  A good summary of the hearing was presented by a KQED report that looked at the following questions:  1. Why Has UC Spending Gone Up So Much?; 2. Are out-of-state students crowding out California kids? 3. What should be considered a “competitive salary” for a UC employee? 4. Are students paying for teaching … or research? 5. Why shouldn’t state lawmakers impose more rules on UC’s use of taxpayer dollars? Of course, this story was buried underneath several reports that UC has decided to freeze summer tuition. Was it just a coincidence that UC made this announcement on the same day as the hearing on UC finances was held? And was it a coincidence that UC waited until the day before the hearing to release its response to AB 94?