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UC regents’ finance committee approves 2013-14 budget

The UC regents discussed budget issues at their September meeting. On Wednesday, the committee on finance approved the 2013-14 budget.

By Kristen Taketa

Nov. 15, 2012 1:51 a.m.

SAN FRANCISCO “”mdash; The University of California Board of Regents committee on finance approved its budget for the 2013-14 year on Wednesday, which assumes hundreds of millions in additional state funds ““ money that University officials said is not guaranteed and may need to be covered by alternate sources such as tuition increases.

The budget, presented at the board’s bimonthly meeting, is the beginning of a long-term plan to stabilize funding and improve the quality of higher education in California after years of state funding cuts, said Patrick Lenz, vice president of budget and capital resources. The budget includes funds to help reduce the faculty-to-student ratio by hiring new faculty, he added.

“We not only see the opportunity for reinvestment, but something that we strive for more than anything, which really is fiscal stability and the ability of campuses to plan their budgets,” Lenz said.

The plan includes a nearly 10 percent increase in total funding for the UC’s core budget of $6.2 billion for the 2012-13 year, according to a budget report from the UC Office of the President.

The budget includes an additional $125.4 million promised by the state, contingent upon the passage of Proposition 30 last week. But the regents also expect the state to contribute more funds, including $276.5 million to help the UC adjust to funding cuts in past years.

In the event the state does not give the University the additional funds the regents expect in the 2013-14 state budget ““ which will be finalized next July ““ the regents would consider a 6-percent tuition increase as a possible way to cover the gap in funding, Lenz said.

Otherwise, the quality of a UC education may have to be compromised again by increasing the faculty-to-student ratio and leaving faculty positions unfilled, among other measures, said Peter King, a UC spokesman.

Lieutenant Gov. and ex-officio Regent Gavin Newsom was the only member of the finance committee to vote against the University’s budget on Wednesday. Newsom said he thinks it is highly unlikely the state will approve the $276.5 million requested in the new budget, adding that he expects a fee increase of at least 6 percent to occur.

“I’ve never seen an increase (in state funding) like that,” Newsom said. “My fear is we’ll be right back at (tuition increases) after this budget cycle.”

Under the new budget the University’s expenditures will increase by 9.4 percent. These expenditures will be used to improve the quality of education and sustain increases in retirement contributions and compensation, among other items, according to the budget documents.

During Wednesday’s meeting, some regents said they expect to accommodate increase in spending by increasing undergraduate nonresident enrollment and requesting additional state funds.

The budget reflects the UC’s hopes to reach a multi-year funding agreement with the state that is centered around Proposition 30, which will raise the state sales tax by a quarter of a cent and collect more income taxes from households earning $250,000 or more, freeing up funds for state programs such as higher education.

The regents reiterated that the passage of Proposition 30 ““ which prevented millions of dollars in immediate cuts to the University ““ does not solve all the UC’s financial problems.

“We are all grateful for Proposition 30, but we know it’s not a magic bullet,” said Regents Chair Sherry Lansing. “Our work isn’t really done.”

The entire board still needs to approve the University budget when the board reconvenes on Thursday, King said. The budget is not set in stone and only provides a preliminary framework for future discussion, he added.

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