At today’s meeting of the Finance Committee, the UC Regents discussed UC’s 2004-5 budget. The main focus was on the elements of the Compact which UC President Dynes and the Governor negotiated. See the following link: http://www.universityofcalifornia.edu/news/compact/compact.pdf
The only action item was proposed increases in student fees in accordance with the Compact. That discussion was complicated by an announcement from Hershman and others about possible state-funded augmentations to UC’s budget. The Assembly budget subcommittee for higher education last night presented information only/possible action items including funding 3% enrollment growth (rep. 6,000) students, 2.41% COLAs for faculty and staff, a 25% General Fund subsidy for professional schools, restoration of funding for the Institute for Labor and Employment, and funding for Outreach programs. The Assembly budget subcommittee is scheduled to convene late today to determine whether to act upon these proposals. If they approve them, the Senate subcommittee and then the full Legislature as well as by the Governor would need to agree with them as well. Nonetheless, I felt you would want to hear this news.
That news created intense debate among the Regents regarding whether or not to adopt a fee structure (increase) for 2004-05. On the one hand, they want to give the Legislature time to provide more funding which would make the fee increase unnecessary. On the other hand, they feel they are legally bound to inform students “in a timely manner” about the fees they will need to pay if UC adopts the fees outlined in the Compact and no augmentations are provided. Bill statements are due to go out in the very near future; the state budget may not be final until July or much later. Some Regents suggested sending out letters that state that fees will be increased unless the Legislature and the Governor agree to provide funding; the UC Counsel agreed that such a “waffling” letter could serve to meet the legal obligation. Some Regents wanted to at least “sleep on it” and wait until tomorrow to decide. Hershman reminded the Regents that summer school students begin at Berkeley in just two weeks and must be told what fees to pay. The chair of the committee pressed for a vote; the result was a tie. So the full Regents’ board will need to act on it tomorrow. In the meantime, the UCOP will draft a letter for their consideration that will fit the elements of the discussion.
In their discussion, many Regents expressed concern about the Compact. Some feared that it will weaken UC’s bargaining power and that it does not really assure future funding. Hershman stated that the Compact is a floor. It represents an agreement for base funding as well as allowing for UC to request augmentations when funds are available. But, the Speaker of the Assembly said that it is merely “a promise between the Governor and the UC that may or may not be kept.” He felt that the Compact “takes the wind out of the sails of those who would like to provide all that is possible for higher education.” Several Regents agreed that it may weaken our bargaining power. Others expressed support for the Compact, feeling that it does provide for a “baseline, a Gentleman’s agreement” that has some value in future budget years.