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.