California breaks higher ed budget standoff

Higher state revenues allowed for a revised funding plan

California Gov. Jerry Brown (D) released a revised budget plan last week that increases funding for the University of California (UC) System, keeps tuition flat for two more years, and ends the standoff between the Governor and UC President Janet Napolitano.

State revenues grew faster than expected, allowing the governor to dedicate more toward education overall.

"This is spectacularly good news and a huge opportunity for schools," says David Plank, executive director of the Policy Analysis for California Education, a research partnership of Stanford University, UC Davis and University of Southern California. "We're finally coming to an end of a cycle where we're restoring what was cut in 2007," he says.

Background

In January, Brown released his $164.7 billion budget proposal, awarding more funds than last year to the UC system but less than the $100 million administrators said they needed to avoid hiking tuition.

Napolitano said she was disappointed by the proposal, which renewed the possibility that tuition may jump by up to 5% annually for the next five years. Brown threatened to nix the additional funding for UC unless it froze tuition.

What UC's funding battle means beyond California

Brown and Napolitano formed a two-person committee to informally review the system's finances and resolve the ongoing budget standoff

The UC funding plan

Under the new budget, UC will receive state general revenue funding increases of 4% in each of the next four years for a total $507 million. Additionally, the system will receive approximately $50 million for energy efficiency and maintenance projects, and is also expected to receive $436 million over three years from California's debt reduction and rainy day fund to go toward paying off pensions. 

In return for the additional funding , the school has agreed to cap future employees' pension benefits , and will examine why the same courses vary in cost from campus to campus. The number of transfer students, summer school programs, and online course offerings will all grow.

Out-of-state and graduate students' tuitions will increase, but undergraduates' will remain frozen for two years, at which time it will rise as calculated through an inflation formula—but will be capped at 5% annually.

The number of in-state undergraduates remains undetermined.

The community college funding plan

The state's 112 community colleges will receive $1 billion more than they did last year, allowing the system in the coming school year to enroll an additional 65,000 students and hire 600 full-time faculty members.

The Cal State funding plan

California State University (Cal State) will receive $157.5 million more than last year but almost $60 million less than what officials requested. The funds will be used to complete maintenance work, hire more academic advisors and faculty members, and grow enrollment.

"[Cal State], the workhorse of our higher education system, has been shortchanged," state senate leader Kevin de León (D) says.

In spite of the funding levels, Cal State will not increase undergraduate tuition next year, says Timothy White, Cal State chancellor (Gordan et al., "PolitiCal," Los Angeles Times, 5/14).

The takeaway: Increased state revenues allowed California Gov. Jerry Brown to dedicated more money to higher education, breaking a budget deadlock between the governor and the University of California president.


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