Wednesday, May 27

UCLA may lose additional state funds under approved “˜rebenching’ budgetary model

Points awarded to students to determine funding for schools under rebenching model
Non-resident undergraduate students
Resident undergraduate students, graduate professional, academic master's, post-baccalaureate
Doctoral students
Graduate health sciences students
Health sciences academic doctoral students
SOURCE: UC Office of the President

State funding for UC campuses before rebenching:
State funds are currently allocated to each UC campus based on an algorithm, taking into account each school's student population and when the school increased its student enrollment.
The algorithm favors older schools, such as UC Berkeley and UCLA, because they increased their graduate student population at times when the state was giving the UC more money for graduate education.
UCLA gets the highest amount of state funds per each resident undergraduate student at $6,413.

SOURCE: Susan Gillman, member of UC Rebenching Task Force

State funding for UC campuses under rebenching:
The amount in state funds each university receives is based on its preset target number of students.
Each school has a different target enrollment number for the different categories of students ­"“ graduate, master's or resident undergraduate, for example.
Every category of student is also allocated a weighted point value.
The point values are then applied to the enrollment targets, and when totaled they make up each school's weighted enrollment number. This number determines the state's funding per school under rebenching, with equal funding allocated to each student.
Rebenching will not redistribute money, but will rather use new state funds to bring all UC campuses up to UCLA's standard.

SOURCE: UC Office of the President

Under a University of California-wide budgetary reform approved in June, UCLA could end up losing out on additional state funds in the future.

The reform, known as “rebenching,” aims to tie state money allocated to each campus to the school’s enrollment and standardize the amount of funding for each undergraduate student.

In the current budget allocations, UCLA receives the most state funds per undergraduate resident student at $6,413.

This year, extra state funds will slowly be doled out to lesser-funded UC campuses ““ Santa Cruz, Santa Barbara, San Diego, Irvine and Riverside. Over the next six years, UC officials said the goal is to bring state funds allocated by enrollment to all UC universities up to UCLA’s benchmark.

Supporters of the rebenching reform say the new funding system will help increase fairness and transparency within the UC.

“In public organizations, such as the UC, if its budget process is more transparent, and people know where the money is going, then clearly you build more trust from the taxpayers,” said Jean-Bernard Minster, the chair of the UC Planning and Budget Committee.

UC Merced, the smallest UC campus, and UC San Francisco, which only enrolls graduate students, will not be included in the new model.

Rebenching will begin to be implemented this year, and will operate on a “do-no-harm” principle so no campus will lose money, said Nathan Brostrom, UC executive vice president for business operations.

The reform system will use new money that is supplemental to the UC budget, rather than taking money from schools and redistributing it, Brostrom said.

In this first stage of implementation, the UC plans to use a portion of $94 million in additional funds the state afforded to the UC this year, he said. About 20 percent of that supplemental money will be sent in installments to the five most underfunded UC campuses throughout the next year.

But UCLA officials have contested the reform’s “do-no-harm” principle, arguing that rebenching fails to consider the additional infrastructure and funding needed for certain types of programs.

UCLA’s large health sciences facilities and programs, for example, have been supported in large part by the state, said Steven Olsen, vice chancellor of finance, budget and capital programs.

“If you have a funding system based only on students, you don’t take (differences in programs) into account,” Olsen said.

Brostrom said, however, the rebenching model already takes into account the varying costs of educating different types of students. Graduate health and sciences students receive more money under rebenching, which helps compensate for the difference in education costs, he said.

The UC will continue to discuss how to allocate funding for different types of students during the course of implementing rebenching, Minster said.

Although UCLA officials have raised concerns that the campus may lose money under rebenching if no new state funds are generated, Brostrom said the rebenching program will not go forward without new state funds.

The UC is currently running estimates on how state funds will be distributed among the different campuses under the new system, Minster said. But it is difficult to confirm a university’s specific budget under rebenching at this time, he said.

It is possible, though, that UCLA may lose out on money from future state fund allocations because it will receive a smaller percentage of new state funds under rebenching, Brostrom said.

The underfunded UC campuses will receive the new state funds preferentially to help raise their funding to UCLA’s level, which will cause UCLA’s budget to grow at a slower pace than the underfunded campuses, he said.

Another concern raised by UCLA officials is the future of rebenching if the UC is faced with additional budget cuts, especially if voters reject Gov. Jerry Brown’s proposed tax measure in the upcoming November election.

The measure, Proposition 30, would increase the sales tax and raise income taxes for upper-income households and help close a state budget deficit of $15.7 billion, according to estimates from Brown’s office. Its failure would result in a set of “trigger cuts” ““ or automatic spending reductions ““ that would cut $250 million in state funds to the UC.

A possible solution under this scenario would be to distribute the budget cuts based on the principles of rebenching, where schools like UCLA and Berkeley would burden a larger portion of cuts, Minster said.

If this solution is implemented, UCLA officials estimate they would take on about $55 million of the budget cut ““ around $10 million more than they would have prior to rebenching, Olsen said.

Another possibility would be to distribute the $250 million cut based on each university’s current state budget, without taking rebenching into account ““ similar to how cuts in state funding are currently distributed, Minster said.

UC officials, however, said they have yet to come up with a definitive solution for what to do if Proposition 30 fails. Estimates on what portion of the cut each campus would incur have not been set, Minster said.

Because of the uncertainties that continue to surround rebenching and the concerns raised by schools like UCLA, Minster said he plans to discuss the reform system at every monthly UC Budget and Planning Committee meeting to help catch any unforeseen negative impacts.

“We want to make sure that the impact of rebenching does not have a negative impact on education, students or on the university as a whole,” he said. “Just because we have a nice algorithm that we’re working with, doesn’t mean that it is necessarily fair, and we do not want to lose track of fairness.”

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