Monday, January 4, 2010

Auditing the UC System

A group of UC unions are planning to submit an official request for the state to audit the UC system. First of all, we want the audit to examine how the UC is spending state funds. Specifically, we are concerned that funds targeted for instruction and research are going for other purposes, and the result is that student fees are going up, but there are fewer classes and fewer teachers and researchers. As a state audit showed in 2001, state funds are often redirected to support an expansion of administration and staff, and we feel that an effective audit should be able to establish which job titles are growing and whether or not these position supports the core mission.

The audit also needs to examine the UC compensation policies and trends. In 2006, the state performed an audit of UC compensation policies and found many inconsistencies; however, this audit only looked at senior management, and we feel that the compensation issues are much deeper and wider. In 2007-2008, the UC had 6,647 employees making over $150,000, and 3,010 earning $200,000 or more. Furthermore, 1,538 people made over $250,000, and 779 earned over $300,000. We believe a thorough audit could determine where state money is going and how compensation is being decided. While the UC is an autonomous institution, the state does have oversight over the money the state provides.

The state auditor should also determine which funds are legally restricted in the UC budget. The university often claims that it has no money to pay for salary increases or to support student services because most of its funds are restricted. We believe an outside authority should be able to make this determination and clarify once and for all which UC funds are restricted.

Perhaps the most important judgment that a state auditor should make is whether the UC was really facing a fiscal emergency when it initiated its furlough plan and gave extraordinary powers to President Yudof in July 2009. There are accepted standards for defining a fiscal emergency, and we need to be sure UCOP met those standards.

We would also like to know how much money the UC system is saving through the furlough system, and where the savings are going. At first, the Office of the President said that furloughs would save $185 million, but after we calculated that the number would be closer to $600 million, the UC said that most of the extra money would be returned to the programs.

The state auditor should also determine how much the UC system has lost in state funding over the last five years. While this number should be easy to calculate, we have received many different figures. There is also a question of what happened to the federal stimulus money (ARRA) that was earmarked for the UC system.

Please give feedback on what you would like us to audit.

22 comments:

  1. Has the request been submitted yet? And when can we expect the audit results?
    Also, those are outrageous salaries. What I'm thinking about right now is what the makeup of the employees in those salary brackets are, especially the 779 who earned over $300,000.
    And if the state does have oversight over its appropriations, perhaps the governor's proposed constitutional amendment only faces three problems.
    I think this is a good move by the group of UC unions. All in all, I think these are good, key things to audit. At least, for the time being, those problems seem to need the most solving.I think those are all questions we all want answered.

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  2. I completely support these audits because if the UC's really are using funds responsibly, they should have no problem with the audit. Where are our supposed savings going? The "restricted funds" excuse is ridiculous and the state auditor should be able to see how these funds are being used. Overall, I think it is great that the truth behind this fiscal issue will be revealed.

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  3. UC should be audited by the state to examine how the grants, endowment, and funds are being allocated and spent. It is unclear to the public how much funds the UCs receive and how they are actually being spent. As mentioned in another post on this blog, UCSF presented "misleading" financial documents when recruiting David Kessler. Perhaps other UCs do the same to please different audiences and the state should be the unbiased third party to audit the system.

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  4. With salaries like those, I understand how an audit is necessary. What steps are necessary to go through a complete audit?
    And certainly they should examine the furlough situation. The matter of $415 million is rather important. Obviously, if the UC system is not telling the truth about where state money is going, an audit is necessary. For that matter, a third party should be in charge of investigating other ways the universities spend their money. The original post said that the university said it did not have enough money to increase salaries and pay for student services, but considering the inflated salaries of administrators, a state official should be in charge of determining this.

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  5. Why are there so many UC employees with such high salaries? Is there really a need for that many high paid administrators or could we decrease the amount of administrators and pay the fewer administrators more money to do better work?

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  6. A UC system audit is a great idea, who and how someone would do this though is another question. The numbers of how much the system spends on some administrators makes me wonder what they really do. I'm sure they make decisions that affect us all, but do so many absolutely need to make more than $200,000?

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  7. I think an audit would be great for our UC system and think nothing but good results would come out of it. In addition to the points this article suggests we audit, I would also like to know where all the money for the construction is coming from? We don't need more housing, we need more teachers!

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  8. I am very pleased to hear that the UC system might actually be audited. However I hope something is done when they find that corruption exists. For some weird reason the UC system seems untouchable when it comes to doing something about corruption. We have all these results that prove corruption and I feel like nothing is ever done about it. Furthermore, who in the F**k needs 300,000 dollars a year. Why not take a pay cut so that students won’t be asked out and have to pay extra for tuition. It will be very interesting to see were the “money being saved from furlough days” is going.

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  9. I agree that there needs to be a re-evaluation in the UC System salary structure. We should not be paying UC employees six figure salaries while cutting back classes and raising student tuitions. Even if we were to give a salary raise for UC employees, it should not be for UC administrators but for professors and lecturers, the people who actually contribute to the education quality.

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  10. Why is there a copious amount of employees getting ridiculous amount of money? The system should consider cutting down their salaries so that money can be spend in somewhere where the students will benefit from their higher education.

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  11. Its a great idea to audit the UC system to find out where all the money that students are paying is going. Students have a right to know where their tuition is going and if money is not being spent properly something should be done to set priorities straight. How will the audit effect the students and faculty?

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  12. I agree that the audit should take place. It would certainly reveal a few things. It would also allow us gain a foothold in understanding what changes need to take place in the system. The state should also consider building a department to have financial oversight on the UC system so that their transactions are monitored carefully. The salary structure, obviously also needs to be re-determined, considering a good amount of our tuition money is going towards the $200,000+ salary of over 4,000 individuals who are not trying to return the favor through increasing educational quality in any way.

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  13. Excessive administration costs are a huge problem not only in the UC system, but also in K-12 education. These costs eat up taxpayers' money and don't actually go towards the classroom. I think all future educational approprations in the state budget require that a certain percentage go directly to the classroom.

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  14. I think that every time money is given to the UC system there should be definite rules on what the money will go into to prevent the administrators from pocketing more money. There should also be a system of checks and balances to make sure these rules are carried out. The audit should be from an unbiased outside company to make sure there are no partialities.

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  15. State money should be evenly distributed to the people who contribute. Money should be deducted from those who make more and should be used towards projects that need funding to increase the quality of our education.

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  16. Considering the UC system's current budget planning, there should definitely be an audit of UC system spending before providing state funds. There should be an audit of where the funds will go and also of where the current hidden funds are.

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  17. I think this audit is a great idea. The state should know where its money is going and students have a right to know where their tution money is going. If this does happen, hopefully the UC system will think twice about how they want to distribute funds.

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  18. The UC budget seems to be a mystery to everyone. I believe the audit is completely necessary because we do not really know where our money is going. We also do not even know how much of it we do have because the numbers are being altered. We as students have a right to know where our money is going.

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  19. The audit is a good idea. The state, as well as the students, have a right to know where their money is going. Hopefully this will keep the UC system from hiding any funds.

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