Wednesday, August 12, 2009

Exchange between Newfield and Judith Innes on budget studies

1. I don't understand what you mean when you say the system subsidizes the professional schools. Are you saying that they get more money per capita than letters and science departments? Are these "subsidies" the same across all types of professional schools? Can someone explain?
Judy Innes

2. yes! General funds come from the state attached to student FTE (the amount has hovered around $10,000 per student FTE in recent years, but Mark Yudof cited $7700 or so in a recent talk). Once in UCOP and then on a particular campus, this state "workload" money doesn't follow the student into his or her primary departments of instruction. Part of it does, and another part goes elsewhere. Various control points on each campus (EVC, deans, etc.) from one year to the next according to all sorts of factors and variations known mostly to them. Thus a med school may get $50,000 per student FTE (a figure mentioned by UC's then-budget director in 2005), and a law school may get $35,000 per student FTE. One case I studied in detail had a humanities division's departments averaging closer to $5000 per student FTE and social sciences still lower than that. In that case, science departments were closer to the humanities, and engineering in between hum and the professional schools. The professional school amounts vary quite a bit, but I have never seen a systematic comparison.

"Subsidize" here means money generated in one place (by enrollments) being spent in another place. It's not inherently bad and to the contrary allows all sorts of great research and teaching to take place even in the absence of paying "customers" and a defined "market." Universities can and should pool resources and cross subsidize to cover special needs and opportunities. That's not always how it works, though, and it's hard to see who's going to win and lose - whether it's a department, school, or campus, without this kind of budgetary detail. Chris

3. Thank you this is helpful, but of course this explanation still leaves me a little mystified as you point out there is no systematic data. I would be surprised if my school (Environmental Design) were heavily subsidized in this way or Social Welfare for example. I hope we will have the data before proposing any blanket policies.

4. Judy, the head of your school would know your per student FTE budget total, and I assume would also know the fund sources (how much is state general fund, how much is fee money, etc.), S/he might not know how this compares to the budget of parallel units. This comparison might only be available at the next level - deans if they are departments, Provost or EVCs if schools, etc. There is no rule - and everyone says transparency is a good idea - but in my experience this information is generally withheld from the next level down, partly to avoid potential conflicts among departments - Chris Rosen's remarkable post lays this out very well.

But the other effect is that dept chairs and even deans may not understand the larger budget picture and thus can't participate intelligently in decisions about allocations. This is even more true of regular faculty members and staff. Even assuming that the EVC is fair to all discipines and that no one is taking advantage of inside information for their own unit's advantage, which of course any ambitious leader would be tempted to do, this lack of budgetary knowledge lowers the institutional's overall IQ. So for example, what would happen to Berkeley social science departments if UCB is able to raise tuition to, say $14,500 in 2010 (which would make up for most of its GF lost to the cuts via tutiion alone)? That depends on what that division's enrollments are, how much of its enrollment-based GF it has been traditionally allowed to keep, and what kind of new deal it would get under a new system. Unless these and similar facts are known or extrapolatable, it's hard to have a solid opinion and hard for an institution to make the best decision.

I think that at least division-level detail should be made available in a systematic way to whatever faculty- staff group undertakes an assessment. Chris


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