Could inflation-adjusted USAC fees cover increase of student groups?

Each undergraduate student would have to pay an additional $60 this year to the undergraduate student government if the current $160 in student fees were adjusted to inflation.

In this scenario, a portion of the extra $1.7 million the Undergraduate Students Association Council would receive would allow funding bodies to allocate more money to student groups.

Most fees that go toward funding bodies are not tied to inflation and are increasing by the same amount of money year after year. This was not a problem early on, but as more and more student organizations are applying for these funds while the purchasing power of the funding pool is decreasing, the amount student groups are being allocated decreases, said Roy Champawat, director of the Associated Students UCLA student union.

This year, USAC could only allocate about $36,000 to the Student Organizations Operational Fund, which is about half of what it allocated last year. SOOF was calculated from the leftover funds after USAC allocated the $858,000 generated from the membership fees for different administrative purposes, such as officer stipends.

Although the membership fee has not changed since 2002, which is $30 per student annually, the increase in administrative expenses, such as increased officer stipends by more than $13,000 from last year, has decreased the amount SOOF can allocate to student groups.

“Years ago, fewer groups applied and you could cover all your administrative costs while funding providing a substantial amount to SOOF,” Champawat said. “But 10 dollars 10 years ago isn’t worth the same as 10 dollars today.”

If the membership fee were tied to inflation, which is calculated by converting the historic buying power of each fee into current dollars, the membership fee would raise $1.8 million as opposed to the current $850,000, for an extra $1 million.

Currently, 80 percent of the leftover funds after administrative expenses have been covered go to SOOF. Since most administrative expenses are already budgeted to increase over the years due to inflation, around $800,000, 80 percent of $1 million, would go toward SOOF if the membership fee is adjusted to inflation.

Earl Torres, a third-year biology student and last year’s financial coordinator of Samahang Pilipino, said that cutting administrative expenses would help student group funding but said he would not argue against a USAC budget that used their funds appropriately.

“Cutting administrative expenses would be optimal,” Torres said. “But as long as USAC is transparent with their budget and all their administrative expenses are necessary, I can’t have anything against them.”

“The undergraduate student government is reaching a critical period where it soon won’t be able to cover the cost of its operation without decreasing the amount SOOF receives,” Champawat said.

In contrast to the membership fee, other fees have added on supplemental fees over the years which has helped offset the decrease in purchasing power, whether or not that was the intention of those fees.

The student body approved a supplemental fee of $0.75 in 2005, adjusted for inflation every three years, to be added on to the $3 Community Activities Committee fee. The student fee accounts for 20 to 30 percent of the total budget of CAC, as a majority of the fees come from the Student Fee Advisory Committee, said Jonathan Tam, chair of the committee and a graduate student in education.

Assuming the supplemental fee is to counteract the decreasing purchasing power of the previous fees of the Community Activities Committee, the fund is still receiving less than what they would receive if their initial fees were adjusted for inflation. The Community Activities Committee is receiving $60,000 less than if student fees were adjusted for inflation.

The committee aims to allocate $400,000 to student groups for its regular funding period each year, but has been allocating less every year due to decreases in funding rollover, which are leftover funds that go to next year’s budget, Tam said.

The committee has had difficulties allocating the amount each student group wants because of the decreasing funds they have to allocate and the increases in student groups over the year.

“Last year we had about 79 groups apply and now we have 88 groups that applied this year,” Tam said. “Five years ago, only 59 groups applied.”

Other fees have not had supplemental fees added, such as the Community Service Mini-Fund which has received the same amount since 1999.

Cynthia Wong, former Community Service commissioner, said when she was on the Community Service Mini-Fund, the committee on average allocated 33 percent of what student groups requested.

Wong believes that even if the Community Service Mini-Fund was tied to inflation, the committee would still struggle to allocate an adequate amount to each student group.

“What we have observed over time is that every single year there are more and more student groups applying,” Wong said. “The amount of money available might not increase accordingly even if it’s inflation adjusted.”

 

New fees, which have been enacted after 2005, such as the Cultural Affairs Commission Arts Restoring Community fee, are tied to inflation and do not struggle as much with allocating an adequate amount to each student group.

For the Arts Restoring Community fund, student groups can receive a maximum of $1,000 per quarter and almost all the $100,000 the fund received was distributed to 61 student groups.

“ARC does have a lot of money and that might incentivize student groups to overshoot their budget because they think funds are unlimited,” Shao said.

Shao believes this situation is unique to ARC because other funding bodies are not able to allocate as much money to student groups.

“Student groups would budget more carefully and be less generous if they are applying to a fund that only gives out a few hundred dollars maximum,” Shao said.

Shao does not see the ARC funding committee decreasing its funding cap for the next few years. Although this could be attributed to the inflation adjustment, Shao also added that the ARC fund is a new fund and that not all student groups know about it.

Although the decreasing purchasing power can be counteracted by adding on catch-up fees every few years, the student body would have to pass a referendum.

“To get some of these fees to be tied to inflation, it’s a little too late,” Champawat said.