Submission: Deflating UC administrative bloat better than hiking tuition

On Jan. 9, Gov. Jerry Brown’s newly proposed budget for the next fiscal year disappointed University of California officials amidst a standoff over tuition increases.

Gov. Brown decided to increase state general funds to the UC by $120 million, falling short of an additional $100 million demanded by UC President Janet Napolitano to stop the UC’s proposed 5 percent tuition hike. If UC officials truly care about students’ education, I believe they should reassess whether tuition increases are fiscally necessary. Although the UC justified increasing tuition partly from the $460 million loss of state funding since 2007-2008, a closer analysis of the UC budget suggests that the UC can easily find alternative budgetary approaches.

State funding for the UC is more complicated than what the UC suggests. Although state general funds have decreased from $3.274 billion in 2007-2008 to $2.797 billion this year, a loss of $477 million, the state has increased its Cal Grant aid to the UC by about $500 million in the same period. The state government has also committed itself to the Middle Class Scholarship program, providing $107 million of aid this year with steady increases up to $305 million in 2017-2018 for UC and California State University students. In the past few years, the state’s grant money seems to have replaced losses in state general funding.

The UC does not consider state grant money to be state funding in its budget report, categorizing it instead as revenue from tuition and fees. In the 2012-2013 UC budget, of its $3 billion in revenue from student tuition and fees, $1.3 billion was actually not paid by students but by “grants and scholarships from federal, state, UC and other sources.” Raising tuition thus not only shifts some financial burden on students, but it also has historically been a way for the UC to obtain more money from the state without having to categorize this money as funding from the state.

Instead of raising tuition, it seems more fiscally responsible to cut costs in noninstructional-related areas. One area is in its enormous growth in administrative bureaucracy in the past two decades. To put that into perspective, with UC student enrollment, in 1993 there were about 54 students to each full-time administrator, but the ratio fell to 24 students for each administrator in 2014. In the same period, the ratio of UC students to each tenure faculty member actually grew from 21 students to 28 students.

Although the cost of UC administrative bloat is not disclosed by the UC, there have been attempts to quantify estimates throughout recent years. United Auto Workers Local 2865, a labor union representing UC student workers and teaching assistants, recently estimated that, over two decades, about $1 billion have been squandered in upper-level management positions. UC Berkeley professor Charles Schwartz, using 1993-2012 employment data, estimates that excess management jobs cost just over $1.1 billion per year. Even using information from the UC’s most recent budget report, of the $6.91 billion UC Core Funds, about $69.1 million go to “Senior Management Salaries” and $1.52 billion go to “Staff Salaries.”

Additionally, the American Federation of State, County and Municipal Employees Local 3299, the labor union representing service and patient care workers across the UC, highlights that the UC can make minor policy changes to save $80 million in executive compensation costs and $37 million in pension costs, among others. University Council-AFT, representing UC lecturers and librarians, suggests that $300 million of the UC’s $13.2 billion endowment and $700 million of its over $14 billion working capital fund can be used to improve financial aid and enhance quality of education. The UC, however, remains committed to the policy of raising tuition, which it expects will generate only $97.7 million in revenue next year, a drop in the bucket compared to the excess costs previously mentioned.

There thus exist many cost-saving pathways that the UC can take if officials commit themselves to freezing tuition. When the University of Chicago, Pritzker School of Medicine faced a $100 million budget deficit in February 2009, it eliminated much of its administrative staff and remained committed to cuts that would not affect university goals of teaching and research. UC officials have no reason why they cannot do the same.

Lu is a second-year political science student, a member of the Student Collective Against Labor Exploitation and a member of the Free University Coalition.