UC Regents discuss University future with state leaders at board meeting
From left to right: Speaker John Perez, Gov. Jerry Brown and University of California President Mark Yudof attended the UC Board of Regents meeting held at UC San Francisco this week.
By Kristen Taketa and
Jan. 18, 2013 1:20 a.m.
SAN FRANCISCO — Several California state leaders joined the University of California Board of Regents at its bimonthly board meeting this week in hopes of finally fixing what they called California’s “broken” higher education system.
UC officials said this was the first time in recent memory so many ex-officio regents – including Calif. Speaker of the Assembly John Perez, Gov. Jerry Brown, Lieutenant Governor Gavin Newsom and UC President Mark Yudof – were present at the regents meeting at the same time.
Perez said he was optimistic that a new legislature and the recovering economy could allow the UC to reverse a years-long trend of state disinvestment in higher education.
Over the past several years, the state has cut about $900 million from the UC system, leaving it with a continuous budget shortfall of millions of dollars.
“The state has clearly turned a corner,” Perez said during a press conference after the meeting on Thursday. “The difference is, we’re not in an immediate economic crisis.”
At the meeting, Lansing and other regents praised the governor’s budget, which proposes an increase of $250 million for the UC.
Now, the regents said they are focused on convincing the state legislature to pass the budget and find alternative revenue solutions if state funding turns out to be inadequate.
Regents discussed the possibility of increasing tuition by up to 35 percent for graduate students – after taking the topic off of their agenda in their last meeting – in order to raise $20.8 million in alternative revenue for the UC. But the discussion on the topic was tabled and the regents did not set a date for voting on an increase.
Regent Bonnie Reiss and Student Regent Jonathan Stein said they were concerned the board had only focused on preventing undergraduate tuition increases prior to the passage of Proposition 30, but neglected to think of graduate students’ tuition.
“We seem to be fighting to keep the undergraduate tuition down and have more or less accepted that (graduate student tuition) will continue to skyrocket,” Stein said.
Even after the successful passage of Proposition 30, which prevented $250 million in trigger cuts to the UC, officials said the University still has to clear political hurdles to save its budget.
Nathan Brostrom, executive vice president of business operations for the UC, said the most critical alternative revenue solution for the University right now is debt restructuring, which has been in the works since 2009.
By managing $2.5 billion of the state’s debt, the UC could save $80 million since the University has a better credit rating than the state, officials said.
If debt restructuring does not happen, the UC’s financial state would be “severely hampered” and $80 million would need to be cut from the University’s planned expenditures, said Patrick Lenz, UC vice president of budget and capital resources.
But Lenz added that the state legislature would need to take action and allow the UC to manage the state’s debt before the UC can move forward with restructuring.
At the meeting, Brown criticized the regents for high executive salaries, adding that a compensation committee recently cut the salaries of state leaders, including himself. He suggested reducing high UC salaries, calling them “a moral issue” and said the University was contributing to the larger inequality of society.
But the regents said high salaries are crucial to remain competitive with other leading universities and that cutting salaries would only have a minimal financial benefit for the UC.
Over the course of their three-day board meeting, the regents also discussed topics like faculty diversity, internal audits and online education.
Stein said he was glad the regents were more flexible in their discussions than in past meetings because California voters approved Proposition 30, a measure that increased income and sales taxes in the state.
“It’s nice to be able to talk about a variety of things going on at the University instead of just focusing obsessively over (undergraduate) tuition increases,” Stein said.
