Continuing Liveblog, EVP Nathan Brostrum (hailing from UC Berkeley) is now talking about the fiscal context which the UC is now worknig on for the next couple years. He’s trying to give context for the new budget situation which the CoTF is working on right now.
Even if the Gov’s budget passes in favor of the UC – we’re still be facing a 237m of Budget Gap. Over the past 20 years, the state has declined from 16.5k per student in 1990, to now 7.5k in 2010. That’s 54%. That means student fees have gone from 2.6k in 1990 to 6.3k 2010.
“We’re coming to a time where the contribution from the students will soon outpace the contribution from the state”
In the past two years, ~4,000 positions have been eliminated from our campuses. Those are people’s jobs who have been lost.
This is the big one: by 2020, we will have a budget gap of 4.9billion dollars between our estimated costs, and our estimated income. DAMN. In four years, we’re facing a gap of 3.2B. This is no increase in student fees, no budget increase, etc.etc.
Major cost drivers in that model is inflation, with over 2.5Billion dollars. The other one is Retirement and Annuitant health costs – 700m and 900m respectively.
Fee increases obviously will not provide muchof an answer – with a yearly fee increase of 4%…even with a state budget increase annual of 4%…will still leave us with 2.9B gap in 2020. We need a drastic shift in public funding, apparently!
The model presented to the CoTF to match the cost drivers, include ~11% annual fee increases, plus a 15% onetime extra jump on fee increases. Overall production, over 2.3B dollars by 2020 created. EVP Brostrum characterizes it as a “draconian fee increase”. It’d also double the number of nonresident students…would create 175m dollar budget revenue.
Gould: Every Director of Finance report shows 20b deficit for the next several years. We’re looking at needing something like 1.7b extra revenues needed for UC to be proficient.
Also a good note brought up by Alan Zuckerberg – the 4.9b gap doesn’t include our salary lag to the market with workers, staff, and faculty.
Yudof: The cost of instruction/cost of a credit hour has not increased very much – to the cost of inflation. The Student fees have gone up so much not because faculty are more expensive, but because the state subsidy has decreased so much. “The state’s co-pay!”
Yudof just affirmed that the state government is privatizing the public higher education by reducing our costs co-pay.
Victor Sanchez (UCSA): Notes that Regent’s Priorities don’t include low student fees…just financial aid. Also, notes that the Regents haven’t projected out any of the alteratnative creative revenue creation.