Thursday, February 3, 2011

A Growth Model for the UC

While a recent Los Angeles Times editorial argued that the solution to the University of California’s budget problems is to reduce enrollments, this suggestion would not only limit access when it is most needed, but it would also hurt the funding of the entire system. Currently, undergraduate tuition is the only stable source of funding for the UC system, and the revenue generated by in-state and nonresident students subsidizes research, administration, and most other UC activities. In fact, the university receives on average $23,000 from each undergraduate student (this includes state and student revenue) but only spends $8,000 on direct instructional costs. In other words, the university will generate more income if it enrolls more students.

By increasing the number of international students and maintaining the level of resident enrollees, the UC could bring in hundreds of millions of dollars, while it supports the goals of access, affordability, and excellence. This growth model would require hiring more assistant professors and lecturers, and for people who worry about undermining the research mission, it should be stressed that the more income generated by tuition, the more we can support research.

Some have argued that the system does not have enough classrooms or facilities, but this is a false excuse. If the universities expand their hours of operations and have more evening courses, more students can be accommodated. Also, housing and dining are self-supporting and often produce profits so they can handle an influx of students, and let’s not forget that there are plenty of empty houses and buildings around our campuses.

A key to this growth model would be a better balance between teaching and research, and this could be accomplished in two cost efficient ways. The first step is to avoid the costly move to online education and to provide more opportunities for faculty members to teach undergraduate courses in their areas of specialization. The UCLA English Department has already moved in this direction. Another move would be to replace large courses with smaller seminars that allow for more student-faculty interaction. While this change looks like it would cost more money, it is often cheaper to have smaller classes due to the added cost of sections attached to large lecture classes.

If the UC can increase its instructional quality, while bringing in more revenue, it can become a national leader in how to save our research universities. All of the other options on the table call for a massive reduction of enrollments, layoffs, decreased opportunity, and financial self-destruction. We can have improved access, affordability, and quality, if we make undergraduate education an essential priority.

13 comments:

  1. You mean, more seminars with temporary faculty. Also you are assuming that the State makes its payment for more enrollment... they don't, it is a fixed pot.

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  2. I also doubt very much there are "hundreds of millions" ripe for the picking in international student enrollment.

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  3. The idea would be to have all types of instructors, including full professors, teach more undergraduate courses. Also, UC turns away thousands of students each year, so there is a great opportunity for expansion,and while the state does not always increase funding based on enrollment, tuition alone brings in extra dollars.

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  4. But if you only get the $12,000 from student tuition, that is perilously close to your estimate of $8,000 for education... and presumably overhead eats up the $4,000.

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  5. The vast majority of students are bringing in $23,000 and nonresident students bring in over $30,000. The university also turns a profit on housing, dining, and parking. Still, we do need to fight for more state support.

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  6. No, the State does *not* pay the $11,000 per student. They pay it as a lump sun and do not increment it when more in-state students are involved. Profits on parking are very strictly regulated and not allowed to be used for anything except parking improvements. Ditto housing. Dining has been largely contracted out, and is not great source of profit anyway. Sorry, your numbers don't hold up.

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  7. The state has always tied UC funding to enrollment targets; although, the next budget may not do this. However, starting this July, each campus will keep its state funding and tuition dollars, and this money will be based on enrollment. On the questions of the self-sustaining units, they are not supposed to make a profit, but like the medical centers, they often bring in more money than they spend, so they use the extra revenue to pump up compensation packages or fund new construction projects. In truth, no one knows for sure where the profits go.

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  8. Not `always', in the past few years the State has refused to tie funding to student enrollment. A fixed sum is transferred. There is no evidence at all that enrolling new in-state students will bring in one red cent of new funds from the state. Incrementing out-of-state enrollees *will*, however, it is just that California taxpayers have paid into the fixed costs of UC for so long, it really seems unfair to crowd their kids out for high-paying out-of-staters.

    Go ahead and dig in and find the profits in parking, housing, etc. Others have tried, particularly for parking, and found nada, nothing, zippo, bubkes, goose egg. Other than the nice collecitve-bargaining negotiated salaries and benefits and regular working hours. f you dig into the hard numbers and identify the funds, I could be convinced otherwise.

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  9. UC Berkeley Chancellor displaces qualified Californians wit $50,000 foreign out of state students. University of California Berkeley, Cal. Chancellor’s gross over spending, inept decisions: recruits (using California tax $) out of state $50,000 tuition students that displace qualified Californians; spends $7,000,000 for consultants to do his & many vice chancellors jobs (prominent East Coast university accomplishing same at 0 cost); pays ex Michigan governor $300,000 for lectures; Latino enrollment drops while out of state jumps 2010; tuition to Return on Investment (ROI) drops below top 10; NCAA places basketball program on probation.

    Chancellor Birgeneau’s ($500,000 salary) fiscal track record is dismal indeed. He would like to blame the politicians, since they stopped giving him every dollar asked for, & the state legislators do share some responsibility for the financial crisis. But not in the sense he means.

    A competent chancellor would have been on top of identifying inefficiencies & then crafting a plan to fix them. Able oversight by the UC Board of Regents and the legislature would have required him to provide data on inefficiencies and on what steps he was taking to solve them during his 8 year reign. Instead, every year Birgeneau would request a budget increase, the timid regents would agree to it, and the legislature would provide. The hard questions were avoided by all concerned, & the problems just piled up to $150 million of inefficiencies….until there was no money left.

    It’s not that Birgeneau was unaware that there were, in fact, waste & inefficiencies during his 8 year reign. Faculty & staff raised issues with Birgeneau & Breslauer ($400,000 salary), but when they failed to see relevant action taken, they stopped. Finally, Birgeneau engaged some expensive ($7,000,000) consultants to tell him & the Provost what they should have known as leaders or been able to find out from the bright, engaged people. (Prominent east-coast University accomplishing same at 0 costs)

    University of California Berkeley and Californians have been badly damaged by Chancellor Birgeneau. Good people are loosing their jobs. Cal’s leadership is either incompetent or culpable. Merely cutting out inefficiencies does not have the effect desired. But you never want a crisis to go to waste.

    Increasing Cal’s budget is not enough; we believe the best course of action for University of California is to honorably replace Cal Chancellor Birgeneau ($500,000 salary)

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