Monday, February 4, 2013

Where Does UC Tuition Go?

One of the most surprising statements from the Legislative Analyst’s recent report on UC salaries is the following: “In 2010-11, UC spent a total $1.8 billion on salaries and benefits for faculty. As shown in Figure 3, nearly three quarters of the funding for faculty compensation came from the state. The remaining funding sources include a mix of federal funds, sales revenues (such as from clinical services provided at the university’s medical centers), private gifts, student tuition, and other funds. (Though student tuition makes up a relatively small portion of funding supporting faculty, the university could use more tuition revenue in lieu of state funds since the two fund sources are interchangeable.)” Looking at the accompanying pie chart, it appears that student tuition only funds less that 5% of faculty salaries and benefits. So the question remains, according to the university, what are students paying for?

I recently questioned UCOP on a budget document presented at last summer’s Regents meeting that said the state pays for 98% of instruction at UCSB, and I was told that this figure includes student tuition, but now it appears that only a small part of tuition goes to direct instructional costs. Let’s keep in mind that these figures do not include student housing and dining, which are self-supporting, so are students only paying for administration, staffing and related overhead?

What I think is happening here is the UC budget strategy has backfired. UCOP thought that if it argued that almost all of the funding for the core faculty salaries and benefits came from the state, the state would realize that it would have to increase the UC budget because the core is the central function. However, the end result has been that the Legislative Analyst is saying that the UC does not need extra funding from the state because it can just use tuition. Meanwhile, the governor is arguing that the UC is asking for too much money, and so the university will have to reduce costs by turning to online education.

One major side effect of this bad budget gamble is that the legislature may not fund the UC’s attempt to increase funding for the underfunded campuses. In other words, the great hope of the rebenching model might be dashed by the UCOP’s refusal to present a non-manipulated budget. Yet, the truth always continues to live a life of its own, and sometimes, it emerges into daylight, and when it does, the pile of half-truths and misrepresentations backfires. In this case, UCOP’s budget distortions could result in a decrease in state funding and an adoption of a costly online program, which will cheapen the UC degree and will put pressure to raise tuition as students pay more for less and faculty are asked to do more for less.

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