Davis Faculty Association

Archive for the ‘Financing Higher Ed’ Category

“Starving the Beast” Screening and Director’s Talk

The DFA is hosting a screening of STARVING THE BEAST followed by a talk by that film’s director, Steve Mims, on the current situation confronting public universities. “Starving the Beast” is a documentary about the crises in education that has been receiving acclaim around the US and has served to create community conversations about the way forward. The film will show on campus on Thursday, April 13 at 4:30 PM in the Art Annex main room.

About the film: STARVING THE BEAST examines the on-going power struggle on college campuses across the nation as political and market-oriented forces push to disrupt and reform America’s public universities. The film documents a philosophical shift that seeks to reframe public higher education as a ‘value proposition’ to be borne by the beneficiary of a college degree rather than as a ‘public good’ for society. Financial winners and losers emerge in a struggle poised to profoundly change public higher education. The film focuses on dramas playing out at the University of Wisconsin, University of Virginia, University of North Carolina, Louisiana State University, University of Texas and Texas A&M.

The $48 fix: Reclaiming California’s Master Plan for Higher Education

On Thursday, January 26, the UC Regents will consider and likely approve their budget for the University for 2017-2018. It and the Governor’s budget, to which it is closely tied, perpetuate decades of failed privatization and persistent under funding of the University and of public higher education more generally. At UC and as compared to both 1990-1991 and 2000-2001, total per student expenditures for instruction and the State general fund contribution to per student instruction are sharply down while the inflation-adjusted contributions from students through tuition and fees are 70% higher than they were in 2000-2001 and 135% higher than they were in 1990-1991. Students and their families are paying more and getting less.

It has become conventional “wisdom” that this continuing decline is inevitable and that viable alternatives do not exist.

The report The $48 fix: Reclaiming California’s MASTER PLAN for Higher Education demonstrates that there is an affordable alternative that restores public higher education in California.

“It turns out that keeping the full promise of the Master Plan-returning the state’s investment per CSU and UC student to 2000 levels (inflation-adjusted); eliminating tuition and fees for all in-state UC, CSU and CCC students; and funding seats for qualified California high-school graduates now refused access to the system-is affordable.”

“California’s two-decade experiment in privatizing higher education has failed, as it has failed in the rest of the country. Top-quality, accessible and appropriate higher education that affords opportunity to all California students has been replaced with a system that restricts access, costs students more and compromises educational quality. Exploding student debt constricts students’ futures and harms the economy as a whole. It is entirely feasible to reinstate California’s proven success in public higher education. Several reasonable funding options can be mixed and matched to make the costs remarkably low for almost all California families. Our state has the means and the opportunity. Will we recover our political will and vision?”

This report was produced by the Reclaim California Higher Education coalition, which includes the Council of University of California Faculty Associations and other organizations dedicated to affordable, accessible, and excellent public higher education in California.

Meet your legislators

Bill Dodd currently represents the Davis area in the state Assembly, and Mariko Yamada was his immediate predecessor in that role. Both have volunteered to speak to DFA members about their experiences in the state Assembly, attitudes of legislators about UC, and about what state legislators can do to help UC. Both Dodd and Yamada are running for a state Senate seat in a race one of them will likely win, so it is important we let them know what our concerns are.

We have created an open Google Doc where people can brainstorm possible questions/ topics for discussion at: bit.ly/1StKYgH. We welcome your submissions.

Meet Bill Dodd, April 22nd at noon, in Sproul Hall room 912.
Meet Mariko Yamada, April 29th at noon, in Sproul Hall room 912.

Chris Newfield’s talk on Feb 8 at 3 pm at Student Community Center

The Provost’s Forums on the Public University and the Social Good

Monday, February 8, 2016

The Great Mistake: How Private-Sector Models Damage Public Universities and How They Can Recover

Christopher Newfield
Professor of Literature and American Studies – University of California, Santa Barbara

Lecture:
3 to 4:30 p.m.
Multipurpose Room, Student Community Center

Reception:
4:30 to 5:30 p.m.
Multipurpose Room – Patio, Student Community Center

Christopher Newfield is professor of literature and American studies at the University of California, Santa Barbara, where he spent many years involved in academic planning and budget for the UCSB and UC-systemwide senate. Much of his research is in Critical University Studies, which links his enduring concern with humanities teaching to the study of how higher education continues to be reshaped by industry and other economic forces. His most recent books on this subject are Unmaking the Public University: The Forty Year Assault on the Middle Class (2008), and Ivy and Industry: Business and the Making of the American University , 1880 — 1980 (2003). He has recently completed a new book on the post-2008 struggles of public universities to rebuild their social missions for contemporary society, to appear with Johns Hopkins University Press this fall. He blogs on higher education funding and policy at Remaking the University (http://utotherescue.blogspot.com), and writes for the Huffington Post, Inside Higher Ed, and the Chronicle of Higher Education.

Professor Newfield will discuss how nearly all public universities now accept the conventional wisdom that the era of public funding is over. This is thought to mean that universities must commercialize, marketize, financialize, and economize. This “new normal” has polarized observers: most senior officials assert that higher tuition, continuous fundraising, corporate partnerships, and sports enterprise support the public mission; faculty critics say the university will then no longer support independent thought. But both positions assume that private-sector changes will make universities more efficient. On this point, both positions are wrong: private sector “reforms” are not the cure for the college cost disease, for they are the college cost disease. This lecture offers an overview of how privatizing public colleges has made them more expensive for students while lowering their educational value, and will outline more-productive policy directions.

FA statement to the UC Regents about proposed new UCRS tier

Professor Celeste Langan spoke on behalf of the UC Faculty Associations at the July 22, 2015 UC Regents meeting during the public comment period. Below is a copy of her full comments:


 

As co-Chair of the Berkeley Faculty Association and on behalf of the Council of UC Faculty Associations, I wish to address the Regents concerning the third discussion item of the Finance Committee agenda, item F3, “Update on Final 2015-16 Budget.” The update, produced by the Office of the President, misleadingly claims that the final budget “incorporates the funding framework developed by UC and the Governor.” If you’ll recall, the “framework” of the May Revise proposed that the state make a contribution of $436 million toward the unfunded liability of the UC Retirement Plan. The final budget, however, promises only a “one-time payment” of $96 million; there is nothing in the budget that commits the state to two additional payments of $170 million. Yet even this meager one-time payment is contingent upon Regential approval of a cap on pensionable salary consistent with PEPRA (Public Employee Pension Reform Act) for employees hired after July 1, 2016.

The Council of UC Faculty Associations is opposed to the University making permanent changes in the structure of its retirement plan in exchange for a very modest one-time contribution from the State. We are especially opposed to the introduction of a full defined-contribution option. There is absolutely no justification for the proposed introduction of a full defined-contribution option; neither the Legislature nor the Governor called for the introduction of a Defined Contributions plan in aligning the UCRP with PEPRA. Yet UCOP seems bent on introducing such an option, to the point that their statement exposes their intention as a foregone conclusion rather than a possible outcome of consultation and deliberation — those elements of what we once understood as “shared governance.”

I call your attention to the third paragraph on page 3 of the F3 agenda item. First OP declares, “The President will convene a retirement options task force to advise on the design of new retirement options that will include the pensionable salary cap consistent with PEPRA. The retirement options will be brought to the Regents next year for review and approval.” But apparently the “design of new retirement options” is a fait accompli, for the penultimate sentence of that paragraph declares, “new employees will have the opportunity to choose a fully defined contribution plan as a retirement option, as an alternative to the PEPRA-capped defined benefit plan.”

Since the two minutes allotted in the public comments session is the temporal equivalent of Twitter’s 140 characters, let me ask: #What’s up with UCOP? If I had to speculate, I’d say that UCOP’s attempt to replace Defined Benefits with Defined Contributions suggests its preference for a mobile, “flexible,” precarious professoriate with a consequently short-term institutional memory — a professoriate that wouldn’t recall that only 6 years ago, the relative merits of defined contribution versus defined benefit plans were thoroughly, carefully, and widely discussed by UC constituents. Given substantial evidence that defined benefits are more cost-efficient than defined contributions in achieving the same level of benefits, it was agreed that the University of California was best served by continuing with UCRP as a defined benefit plan. Thus in 2010, when the President recommended and the Regents endorsed pension reforms, UCRP was preserved as a defined benefit plan.

Ironically, the paragraph in question concludes, “For represented groups, retirement options will be subject to collective bargaining.” Well, the UC Faculty Associations represent a good number of those faculty, members of the Academic Senate, without collective bargaining rights, and we say that UCOP has vitiated the interests of that faculty, both those vested in the current UCRP and those who will be hired after 2016. We deplore the introduction of a different tier of faculty benefits, but we firmly oppose the attempt of UCOP to introduce a fully defined contribution plan in this untoward and unjustified manner.

Comments on the final 2015-16 state budget

By Joe Kiskis

This note makes a few comments on the final UC budget for 2015-2016 and then focuses on points related to the UC Pension Plan (UCRP). To some extent, it updates previous comments here by including changes since then and information that was not available then.

The 2015-16 UC Budget and UCRP

To get good information on the budget, one must read both AB 93 and SB 97. The process this year was a little convoluted. On June 15, the legislature passed AB 93, the Budget Act of 2015. This was the Legislature’s version of the budget and was passed on that day so as to meet the constitutional deadline. It was done before the Legislature and Governor had come to agreement. Their agreement was announced the next day. To account for that and other small items in the following days, SB 97 was passed on June 19. It makes many significant amendments to AB 93, including a number relevant to UC. Both AB 93 and SB 97 were signed by the Governor. However the Governor exercised his line item veto authority in a few minor ways that are not relevant to UC. To get complete information, there are, as usual, trailer bills to read. One of those, SB 81, has a few parts relevant to UC—most significantly concerning the Middle Class Scholarship Program.

The main features of the UC budget concerning tuition and the base budget came out as expected and as have been widely reported. However, it’s worth noting that the final language on these points is less proscriptive than in the original version and that what is expected to happen in the out years is just that—an expectation that is not mandated in this budget. Briefly, per the Regents decision of May 2015, tuition for California resident students is to remain constant for two more years. Following that, modest increases comparable to the rate of inflation are possible. On the other hand, for non-resident students, tuition will likely increase by 8% in each of the next two years. System-wide Student Services fees (as opposed to tuition) are allowed to go up 5% ($48).  The increase in the 2015-16 UC base budget is the same as the Governor originally proposed, i.e. 4% or $119.5M. The expectation is that 4% increases will continue through 2018-2019.

There was an expectation that the Legislature would augment the Governor’s budget with funding for enrollment growth and that the Governor would not line-item veto it. This did not turn out as well as was hoped. The amount is only $25M, and it is contingent on UC adding 5,000 resident undergrads by 2016-17. This is a short timeline, and the amount is far below that needed to educate 5,000 students for one year. On a per student basis, it is also substantially below the average State contribution to the cost of education.

Earlier versions of the budget had limits on nonresident enrollment. Those did not make it into the final budget.

In the trailer bill, the eligibility requirements for the Middle Class Scholarships have been raised and the funding for the program has been decreased.

UC Retirement Plan (UCRP)

As it turned out, there is a large discrepancy between the language related to UCRP in the publicized agreement from the Committee of Two (or equivalently in the Governor’s May Revise statement) and that which actually appeared in the final budget product.

The original claim was that there would be a one-time payment of $436M spread over three years ($96M in the first year) to pay off a small fraction of the UCRP unfunded liability. In return the University agreed to make a permanent change to UCRP by adding another tier that would apply to new employees. In this new tier, UCRP eligible salaries were to be capped at the inflation indexed PEPRA/Social Security limit ($117k for the current year) rather than at the IRS limit of $265k currently used by UCRP. Employees in the new tier would have the option of either a defined benefit plan with the new cap in combination with a supplemental defined contribution part or a defined contribution plan with no defined benefit portion. The second option of a straight defined contribution (DC) plan is most troublesome. Fortunately, no language describing such options was incorporated into the budget bills signed by the Governor.

The Governor’s May Revise letter to the Legislature suggested budget bill language. This suggested language said only that UC would get a one year addition of $96M in exchange for making UCRP consistent with the PEPRA cap. It said nothing about how that should be done. It made no mention of $436M, no mention of a DC supplement, and certainly no mention of a DC only option. This recommendation was followed, and the language that the Governor suggested is essentially that of the budget bills. However, to drive home the point that there is no larger deal, the amended version of the budget adds:

“This appropriation does not constitute an obligation on behalf of the state to appropriate any additional funds in subsequent years for any costs of the University of California Retirement Plan.” (SB 97, p. 96)

Thus neither the Governor nor the Legislature are pressuring the University to introduce a straight DC option. The DC option is something introduced (most likely by UCOP) during discussions in the Committee of Two but done without appropriate consultation within the University. Nevertheless, the Office of the President intends to pursue the possibility of a DC only option. In the discussions that will take place in the coming months, it is worth keeping in mind that a DC option appears to be primarily a priority of UCOP and not of the Legislature or the Governor. Note also that the relative merits of defined contribution verses defined benefit plans were thoroughly, carefully, and widely discussed in the University about six years ago. The conclusion was that the excellence of the University was best served by continuing with UCRP as a defined benefit plan. Thus in 2010, when the President recommended and the Regents endorsed pension reforms, UCRP was preserved as a defined benefit plan.

The May Revise

As the Legislature and Governor enter the end game for the 2015-2016 budget, here is a review of provisions related to UC in the Governor’s latest budget proposal—the May revise, which is now being considered by the Legislature.

It appears likely that the final UC budget will have provisions that address access and affordability. What is missing are resources to ensure that the university can maintain quality. It is the hardest to quantify, the weakest politically, and is now the most seriously threatened.

This budget is another demonstration of the truism that the only way to restore access, affordability, and quality is through adequate State investment in public higher education. In spite of strong revenues to the State, the Governor’s budget falls well short of what is needed to reverse the negative trends in recent years. As it happens, it is well within the means of the citizens of the State to restore all of California public higher education to the levels of access, affordability, and quality enjoyed in 2000-2001. http://keepcaliforniaspromise.org/473424/reset-2015-16

The May revise budget summary is available at

http://www.ebudget.ca.gov/2015-16/pdf/Revised/BudgetSummary/FullBudgetSummary.pdf

The UC part begins on page 28. Professor Chris Newfield (UCSB) has previously commented on the May revise at

http://utotherescue.blogspot.co.uk/2015/05/the-may-budget-revision-uc-budget-goes.html.

Many aspects of the May revise as they relate to UC are contained in the agreement of the “Committee of Two”

http://budget.universityofcalifornia.edu/

now endorsed by the Regents

http://regents.universityofcalifornia.edu/regmeet/may15/j2.pdf.

1) Systemwide tuition and fees for California resident students are to remain constant for two more years. Following that, modest increases comparable to the rate of inflation are allowed. On the other hand for non-resident students, tuition will increase by 8% in each of the next two years.

2) Increases in the UC base budget are to be the same as the Governor originally proposed, i.e. 4% per year ($119.5M for 2015-16) but are now continued through 2018-2019. This is much less than what the State should contribute to replace cuts since 2007 and is also substantially less than the needs identified in the UC proposed budget for 2015-2016. http://regents.universityofcalifornia.edu/regmeet/nov14/f1.pdf http://regents.universityofcalifornia.edu/regmeet/nov14/f1attach1.pdf

The May revise also proposes one time funds of $25M for deferred maintenance and $25M for energy efficiency projects.

3) The May revise contains a tepid and ambiguous recognition of a State obligation to UC pensions. One-time funds of $436M spread over three years (with $96M for 2015-16) are proposed. However, this is Proposition 2 money, which can be used only to reduce the UCRP unfunded liability (about $7.6B in the last annual report). The one-time payment is only modestly significant in the long run and has negligible impact on the University’s operating budget in the near term. This is because the University has not planned to increase the UCRP contribution rate above 8% for most employees and 14% for the employer. Contributions at this rate cover only the current year additional liability and some of the interest on the unfunded liability. I.e. at this point, the regular employer and employee payments are making no contribution to retiring the unfunded liability. Thus in near term years, the Proposition 2 money does not reduce the large negative impact on the UC operating budget from regular UCRP contributions. The Proposition 2 money could be framed as a replacement for or enhancement to UC’s own occasional ad hoc payments to reduce the unfunded liability, but these have been very controversial, and UC has not revealed any plans to make another such payment.

Unfortunately this modest one time contribution comes with permanent strings. In return UC is required to introduce yet another tier to UCRP that would apply to new employees. The new tier will mirror state law for other state employees. In this tier, UCRP eligible salaries are to be capped at the inflation indexed PEPRA/Social Security limit ($117k for the current year) rather than with the IRS limit of $265k currently used by UC. Employees in the new tier will have the option of either a defined benefit plan with the new cap and an add-on defined contribution plan to supplement the defined benefits or a fully defined contribution plan. It is this second option that is particularly troubling.

The relative merits of defined contribution and defined benefit plans were thoroughly evaluated and debated during the extended review that led to the 2010 reforms of the UCRP. The conclusion was that a defined benefit plan is the more advantageous option for both the University as an employer and for its employees.

The main concern is not so much that UC has cut a deal on this issue but rather that it has made such a poor deal. For very modest one-time money, it has agreed to make permanent changes to UCRP including offering a completely defined contribution option that will put at risk the whole of the defined benefit plan. (Chris Newfield has previously made similar comments as mentioned above.) In addition the closed process by which this agreement between the Governor and the President was reached has undermined shared governance and collective bargaining.

4) UCOP has stated that the Governor has agreed not to veto additional appropriations for UC that come out of the legislative process. The University is asking legislators for additional funds to increase California resident enrollment.

5) There are several areas in which the President has committed UC to the implementation of additional efficiencies. These include transfers, time-to-degree, advising, and use of technology. Some of these Presidential promises relate to topics that are squarely within the authority of the Academic Senate, and all of them would normally be addressed through shared governance.

First round is on us, June 10th at Sudwerk

The Board of the Davis Faculty Association invites all UCD faculty to join us over a beer – or other drink – at Davis’s Sudwerk restaurant at 5:00 pm on Wednesday, June 10th. The first drink will be courtesy of the DFA.

Come discuss the issues confronting UC. We want to hear about your concerns, your suggestions, and any other input you may have for the Board of the DFA. To be effective in representing you, we need your help.

Please forward this message to your colleagues! As the University of California continues to face challenges, we need concerted action as much as ever.

Please join us on the 10th.

More evidence of the decline in state support

As UCD faculty we are all unhappily aware of the erosion in state support for our institution and its students.  Perhaps, however, we view this with an element of resignation as a part of a national trend.  However, according to a study by the Chronicle of Higher Education, of 70 large research institutions in the country, UCD has the dubious honor of ranking second in terms of erosion in state support, trailing only UI, Chicago.  (Three others of the ‘top seven’ on the list are other of our sister UC campuses.)

http://chronicle.com/article/25-Years-of-Declining-State/144973/

California’s Research University: The UC System, Yesterday, Today and Tomorrow

Spring 2015, Mondays 6:10 to 8:00 pm, Bainer 1062.

Instructors: Jim Chalfant, Department of Agricultural and Resource Economics, and Bob Powell, Department of Chemical Engineering and Materials Science and Department of Food Science and Technology.

This series will examine the nexus of the excellence of the University of California and its budget. Our focus will be on the disinvestment by the State in UC and the measures that UC has taken to maintain its place among the greatest research universities in the world. We will explore such topics as UC’s research mission, the roles of graduate and undergraduate education at UC, the current realization of the Master Plan for Higher Education, tuition, and the UC budget. The main focus will be on the ten campuses, with additional consideration of the University’s other roles: its role as a large provider of health care, in management of three national labs, and in the delivery of agricultural research and extension, along with other prominent examples. Outside speakers from both the UC Office of the President and the campus will help frame these and other issues.

Guest Speakers:

March 30: Patrick Lenz, former Vice President Budget and Capital Resources

April 6: Bob Powell. CHMS and Food Sci. Tech, UC Davis

April 13: Ralph Hexter, Provost UC Davis

April 20: John Aubrey Douglass, Senior Research Fellow, Center for Studies in Higher Education UC Berkeley

April 27: MRC Greenwood, Chancellor Emeritus UC Santa Cruz and Linda Katehi, Chancellor UC Davis

May 4: Nathan Brostrom, Executive Vice President & Chief Financial Officer

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