Archive for October, 2012
Several unions representing UC employees — AFSCME, CNA and UPTE — have hired Pension Trustee Advisors, Inc. (PensionTrusteeAdvisors.com), to examine the UC Retirement System. This pension consultant will be presenting the results of his research online in a “webinar” to be held Thursday, November 1, at 1pm. UC faculty are invited to “meet’ the consultant online. People can participate by rsvp-ing with AFSCME’s Trevor McNeil: firstname.lastname@example.org.
The unions feel this adviser has identified cost saving measures and are trying to get this issue placed on the November Regents’ agenda. I spoke with Trevor and asked him about these cost savings and have pasted his response below:
William “Flick” Forina – a contributor and leader in his field – is the actuary we’ve asked to look at the UCRP. He has found that the funding policy adopted by the UC Regents in 2008 amortizes the University’s unfunded liability incorrectly which results in a front-loading of liabilities and an inflation of pension costs. What that means for UC faculty and our members is a new two-tier system of greater contributions, less benefits, and a less attractive tool for recruiting and retaining top talent.
We think the UC Regents should hear us out at their November meeting and we hope that after you hear from our actuary and ask him questions in this webinar, you’ll agree with us.
CUCFA President Bob Meister was quoted extensively in an article about the importance of Proposition 30 to public higher education published in the Huffington Post Tuesday.
The full article is online at
And here is an excerpt:
When Gov. Jerry Brown (D) signed the FY 2013 budget, it included an agreement with the University of California not to raise tuition, and the California State University system pledged that if Prop 30 passed, its students would receive a $498 tuition reimbursement. But Robert Meister, president of the Council of UC Faculty Associations, said its budget is dictated by that of the state. Because California’s budget was predicated by the passage of Prop 30 — or significant trigger cuts if it fails — Meister calls the arrangement a form of “budgetary terrorism” on higher education funding.
Nevertheless, Meister said faculty have no choice but to support the measure, because there is no plan B to shore up university funding and the alternatives are much worse.
All but 1.6 percent of the $6 billion trigger cuts would hit some level of public education, with much of that directed to K-12 schools.
If Prop 30 fails, both the University of California and California State University systems will get a $250 million cut. UC would likely increase tuition by a minimum of 20 percent to respond to the shortfall; CSU would likely raise tuition and admit 20,000 fewer students to respond to its own cut, according to reports. Community colleges would get another $338 million cut in the middle of the 2012-13 academic year, and faculty could expect more job losses and furloughs, not to mention a lack of a pay raise.
“[Brown] came into office with the promise that he would go to Californians and defend the public the sector,” Meister said. “His approach instead is to act like a bad parent and hold a gun to the head of the favorite child”: education.
For background information about Propositions 30 and 38, see http://voterguide.sos.ca.gov/propositions/. Prop 30 will raise the sales tax 0.25% for four years and increase personal income taxes on high earners for seven years to fund schools, provide general fund revenues, and to guarantee public safety realignment funding. Prop 38 competes with Prop 30 and would raise state income taxes on a sliding scale for all Californians for 12 years. Revenues go to K–12 schools and early childhood programs, and for four years a portion would go toward repaying state debt.
The historic decline in state support
State funding per full time student has fallen from $17,407 in nominal dollars ($23,178 in inflation adjusted dollars) in 2000-01 to $10,025 in the current year. Funding for the current year will decline further to $8,971 if Proposition 30 fails and UC receives a $375 million trigger cut ($250 million in the current year budget and another $125 million next year).
The cuts to faculty, staff and expansion of student population
As a result of this reduced funding, since fiscal 2008-09 over 4,400 employees have been laid off, over 3,570 positions have been eliminated, faculty hiring has been deferred, academic programs have been cut, courses have been eliminated, class sizes have increased, counseling and library hours have been reduced. Between April, 2009 and April, 2012, UC had a net loss of 277 ladder and acting faculty FTE, replaced by what UC calls “other teaching faculty” – who are less expensive and less empowered.
Even with this influx of “other” faculty, student population growth has driven the student-to-faculty ratio ever upward. Even with the constant increase in enrollment (from 183,355 FTE in 2000-01 to 237,218 in 2011-12), UC has been unable to meet in-state enrollment demand, reducing freshman enrollment by 2,850 each of the last two years.
The ladder faculty that remain are being paid less: in 2008-09 UC faculty were already paid 9.5% less than their “Comparison 8” peers. In 2009-10, with furloughs in place at UC, UC faculty fell 11.2% behind their peers. Since then, UC faculty have experienced a 2% cut in pay (a 3% merit increase offset by 5% of pay redirected to funding the retirement plan), and will experience another 1.5% pay cut this coming July. And that doesn’t consider the erosion caused by inflation.
The cost of restoring UC to the already diminished 2000 levels
Restoring per student funding and full enrollment would cost $3.2 billion this year, $3.5 billion if Proposition 30 does not pass.  Over the past few years UC has been trying to cover the loss of state funding through student fees, which have risen from $3,964 in 2000-01 ($5,278 in 2012 dollars) to $13,230 in 2012-13. Even so, the overall funding available per student is lower now than it was in 2000. Funding the $3.2 billion gap needed to restore funding per student to 2000 levels and restore enrollment using just student fees would require raising student fees an additional $11,680, to a total of $34,910 per year – for in state undergraduates.
State support and tuition are the only sources of funding that can come close to raising $3.2 billion per year. UC receives a total of $1.67 billion in private support each year, and 98% of that private support is restricted money. UC would have to triple private funding, and all the additional private funding would have to be unrestricted or designated for core costs, to cover the funding gap through private funding. Winning more research funding would actually exacerbate the problem; due to its low indirect cost recovery (ICR) rates, UC loses $500 million on the $4 billion in research it performs in a year, money made up for with state funding and tuition. Even UC’s newly negotiated ICR rates are net losers.
The necessity and limitations of Prop 30
Passing Proposition 30 does not undo the damage of recent budget cuts, but it would prevent things from getting worse in the next year, by avoiding $375 million in trigger cuts to UC over the next two years. By law, Proposition 30 will be nullified if Proposition 38 gets more votes, and Proposition 30 is better for the state than Proposition 38.
Either Proposition would bring about $3 billion per year into the state’s general fund in the years 2013-14 through 2016-17, some money of which would probably be apportioned to UC by the Governor and the legislature. But there are two big differences.
The first, and most critical, difference is that Proposition 38 produces no revenue for 2012-13, while Proposition 30 is already written into the 2012-13 budget and its passage will save UC $250 million in trigger cuts in the current budget year.
The second is that, after 2016-17, Proposition 38 continues to collect in excess of $10 billion in extra income tax revenue each year but puts all of it in preK-12; there isn’t even money to go to community colleges because Proposition 38 bypasses the Proposition 98 mechanism. The tax does not sunset until 2024. Meanwhile, Proposition 30 continues paying into K-12 and community colleges through the Proposition 98 mechanism and continues paying into the general fund, albeit at a somewhat reduced rate due to the expiration of the sales tax portion of the proposal, until 2018, when the income tax portion of the proposal expires.
The consequences if Proposition 30 fails to pass
UC’s plan, were Proposition 30 to fail, is to raise student fees, mid-year, by 20.3%, an action likely to be decided at the November Regents meeting. Many students with the skill and drive to excel would not be able to afford UC – some would go elsewhere, others would not go to college at all. Out-of-state enrollments would continue to grow. As UC educates fewer Californians, public support of UC would likely wane. The cost to support graduate students and hire Research Assistants, or other positions that pay for tuition, would rise accordingly, further reducing our ability to offer competitive graduate fellowships and recruit the best graduate students. To reduce loss through Indirect Cost Recovery (see above), research opportunities will be curtailed. The shift from ladder faculty to contingent faculty, and ever growing class sizes, would continue. UC may further reduce effective faculty and staff pay by requiring higher employee contributions to the UC retirement plan. Health benefits for retired faculty, which were cut recently, or other benefits, might see further cuts. If Proposition 30 fails, Governor Brown has said he will not try again to raise taxes. Without future revenue increases to the state budget it is highly unlikely there would be future state funding increases to UC.
 http://budget.universityofcalifornia.edu/files/2011/12/Budget_fact_11.29.11.pdf / http://regents.universityofcalifornia.edu/regmeet/jul12/f1.pdf
 Slide 30 of http://www.universityofcalifornia.edu/regents/regmeet/sept12/cw12.pdf
Please see the following invitation. The DFA is co-sponsoring a meeting of a group of faculty from northern UC campuses on Sunday October 28 from 12-2 PM, to discuss possible actions we can take in defense of the public nature of our university. Please join us if you can.
What is to be done? A gathering of faculty taking action for the public university
Sunday October 28, 12:00-2:00
Wheeler 330, UC Berkeley
RSVP (email@example.com) if possible, but feel free to join even if you were not able to respond beforehand
Dear friends and colleagues,
We are in the early days of what promises to be a turbulent year at the University of California. Whether Proposition 30 passes or not, the University and all its campuses are facing major decisions about what sort of institution we are and want to be, in the face of ongoing pressures toward privatization at all levels. Both students and campus unions are discussing steps for after the election. Now more than ever, it is urgent that we, as faculty, are speaking publicly for the values we understand to be fundamental to the educational project.
On Sunday October 28 from 12-2 pm, a group of faculty drawn from the northern UC campuses will gather to discuss the multiple kinds of actions and interventions we can engage in, in defense of the public nature of the University. Please join us. This follows on a meeting held on September 30, in which an initial group from Berkeley, Santa Cruz, Davis and UCSF gathered to share challenges for each campus and for the larger system and to envision our role in protecting the University as a public institution. Notes from that meeting, including both minutes and graphic records of the conversation, can be found here:
All are welcome on October 28. Please join us, whether or not you attended the first meeting.
And please forward widely.
The meeting is sponsored by the Davis Faculty Association, the Berkeley Faculty Association and the Faculty Organizing Group at Santa Cruz.
For more information or to RSVP, contact firstname.lastname@example.org.
Professor Robert Powell, recent past Chair of CHMS from 2002-2011, and now Chair of the UC system-wide Academic Senate, will present a special talk this Monday at noon entitled: The University of California: Access, Affordability, and Excellence in an Environment of Rapid State Disinvestment.
The University of California: Access, Affordability, and Excellence in an Environment of Rapid State Disinvestment
A public lecture given by Professor Robert Powell, Chair of the system?wide UC Academic Senate and Faculty member of the Department of Chemical Engineering & Materials Science and the Department of Food Science & Technology.
Kemper 1065, noon, Monday October 22
Abstract: Access, Affordability and Excellence have been the hallmarks of a University of California education. Until recently these have been underpinned by the investment of the State of California in public higher education. That investment has paid off in a highly educated workforce that has been responsible for creating industries that touch our lives every day. The recent history is different. By all measures, the state has been disinvesting in public higher education for at least 20 years. For the first time in 2011?12 this resulted in student tuition surpassing state core funding. Still, the budget cuts have been only partially offset by the dramatic tuition increases. This talk attempts to provide a perspective on the budget crisis facing public higher education in California, with a particular focus on the University of California. Measures that have been taken will be described, as well as new measures that are being proposed to ensure that the three pillars that make the UC what it is are maintained and even enhanced.
If you have the opportunity, in the next few days, it might be kind to remind students, some of whom have only just come of voting age, that the deadline to register to vote is Monday. This does not have to be something that takes away classroom time, it is a message that can be chalked ahead of time or transmitted outside of class time.
For people who have a signature on file with the DMV, the process can now be accomplished completely online up until midnight on Monday from the CA Secretary of State’s website: https://rtv.sos.ca.gov/elections/register-to-vote/
Those without a signature on file must deliver the signed form or mail it postmarked Monday.