A closer look at the budget

 

Media coverage of the budget has focused on the overall increase in funding for UC and the requirement that the system limit out-of-state enrollment. There’s also been attention paid to the funding of a research center on gun violence. Here are some other takeaways from the budget:

  1. An AFSCME-funded actuarial study found that the UC’s new DC pension option would cost $600 million over 15 years, which led Assembly member McCarty to call for cutting that option. McCarty’s plan, however, was not included in the budget. The DC plan entered the picture following talks between Napolitano and Brown last year, when Napolitano agreed to cap the DB plans at the state’s PEPRA levels. Napolitano claims having the DC option, which is easier to take to another job and ergo more attractive, will help UC recruit top faculty. She notes that most private sector jobs have also shifted toward this DC model. Some faculty have argued a strong DB plan is key to retaining top researchers at UC, because it’s something UC can offer that is less common at private schools. Moreover, it encourages people to stay put, as it is less mobile. The actuarial study assumes that 20 percent of folks opt for the DC model once it launches. Also, it should be emphasized that the $600 million figure is cumulative over a 15 year period. By year 15, the DC option will cost $74 million annually, out of a total payroll of $16 billion, the study suggests.
  2. The budget calls on UC to “implement measures to reduce the university’s cost structure,” specifically noting that “at a minimum, the Regents shall, when considering compensation for any employee designated to be in the Senior Management Group, use a market reference zone that includes state employees.”
  3. An amount of $20 million “is included on a one-time basis for student support services for low-income students and students from underrepresented minority groups, including students who were enrolled in high schools in which the enrollment of students who were unduplicated pupils…is more than 75 percent of the total enrollment.” Additionally, $5 million is set aside “for expansion of retention and support services for students who were unduplicated pupils,” meaning students who are English language learners, meet income or categorical requirements for free or reduced-price meals or are foster youth. The budget also notes each campus is supposed to increase enrollment of such students.
  4. A total of $22 million is included for innovation and entrepreneurship programs. The success of QB3 was discussed by legislators in reference to this money.
  5. An amount of $500,000 was included “for the Underground Scholars Initiative at the Berkeley campus,” which helps formerly incarcerated UC Berkeley students.
  6. No doubt in reference to Katehi, the budget declares UC will “review the policies and procedures governing outside employment by university executives and senior management.” The bill suggests that any outside employment should not create any conflict of commitment, “where those are actual or perceived.”

What didn’t make the final bill?

  1. An amount of $6 million set aside “for support enrollment of at least 600 more resident graduate students in 2016-17” compared to 2015-16.
  2. Earlier language stated the state assumes “a marginal cost of $10,000 for each resident undergraduate student” in reference to a requirement that enrollment increases by 4,000 from 2016-17 to 2017-18. In 2007-08, before the recession, the state gave roughly $16,000 per student.

Budget Bill

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