SANTA CRUZ: OFFICE OF THE ACADEMIC SENATE
From Senate Chair Susan Gillman’s Announcements, November 9, 2011 Senate Meeting:
You’ll hear next from Chancellor Blumenthal, channeling EVC Galloway, who has wisely chosen to miss the Senate meeting so that she could be physically present at today’s campus rally at the Quarry in support of the statewide Day of Action. The Chancellor will fill us in on our own local multi-year approach to coping with the cuts. He will also comment on the parallel track at Office of the President (OP), where there is an effort at systemic reform of the UC budget, in the form of what are known as Funding Streams and Rebenching.
“Funding Streams” and “Rebenching” are inelegant terms for major systemwide reform of the budget. What problem does this reform address?
OP uses an incremental budget process to determine annual budget amounts for each campus. This process consists of a permanent base amount, which varies by campus, and incremental adjustments made annually to the base amount. The budget process results in varying amounts per student distributed among campuses—in Fiscal Year 09-10, the range is of $12,309 (UCSB) to $55,186 (UCSF), with UCSC at $12,846. [Source: State Auditor Report, July 2011 http://www.bsa.ca.gov/pdfs/reports/2010-105.pdf ]
OP could not identify reasons for these differences or quantify them, other than to cite the cumulative outcome of a long history of incentives and disincentives, marginal increments and decrements, with the base budget permanent and all changes occurring only on the margins. Cross-subsidies thus reflect historic priorities and rationales that may have changed (e.g. weighting of graduate students by 3.5 FTE ended in 1996) but the subsidies themselves were built into the base budgets of each campus and have therefore become permanent.
THE SOLUTION: A TWO-PHASE APPROACH
Budget reform was launched with the first phase, called Funding Streams. This reform makes more transparent various revenue sources, or “funding streams,” in non-state portions of the budget, allocating them on the basic principle that revenues generated by a campus should be returned to the campus (whether from student tuition, including non-resident tuition, contracts and grants, other fundraising, etc.).
Next, in July 2011, the State Auditor Report came out in media res, when Phase 1, Funding Streams, had been completed, and Phase 2, Rebenching, was launched but shakily. President Yudof established the Budget Rebenching Task Force as an administrative group whose roster includes six chancellors, one EVC, vice-chancellors for planning and budget, OP budget managers, and five Senate representatives.
Phase #2: Not Yet
We are now operating under partially-completed budget reform. Phase 1, Funding Streams, depends for its intended outcomes on Phase 2, Rebenching, the second phase of UC’s own internal budgetary reform — the allocation of state funding to the campuses in a more transparent and equitable way. This situation promotes the status quo, which the President has publicly recognized as the leaderless outcome of a long history of ad hoc budgetary decisions. By permitting campuses to retain all the revenues they generate, Funding Streams locks in the competitive advantage of campuses that were historically advantaged by differential funding; by failing to move to Rebenching, the UC system locks in that competitive advantage. In addition, still uncompleted is the third pillar of budgetary reform, the funding for UCOP itself and how we address systemwide expenses.
The momentum in Rebenching is clearly in the direction of a formula linking systemwide allocation of core funds to current student numbers, with funding tiers for different classifications of students (undergraduate and graduate students including Masters, PhDs, professional degrees). Closing the per-student funding gap will bring the UC budgetary model in line with the long-held goal of a single public university with ten distinctive locations across California. This goal has been reaffirmed at multiple times and in multiple venues by the Senate, and it is now in jeopardy.
The Academic Council’s Rebenching proposal proposes a methodology for ensuring that each campus has the support it needs to meet the mission and Master Plan obligation of educating all qualified, state-funded students. The Council proposal is guided by the principle that all UC students of a particular classification, regardless of campus, should receive the same level of funding necessary to support a UC-quality education. It also includes a mechanism for funding PhD students that recognizes the centrality of doctoral education to the UC mission and the interdependence of graduate and undergraduate education at UC.
The principle has been nominally accepted in Rebenching discussions thus far, but it is unclear how, when, or even whether it will be implemented. Among the stumbling blocks to consensus, some are significant while others appear to be delaying tactics. A significant question remaining is how funding for health sciences, agriculture and other systemwide priorities should be treated. Less substantive questions include whether Rebenching should apply only to new state funds, or whether it should be implemented over a long transition period. A clear delaying tactic is a repeated objection that Rebenching will be divisive, pitting haves against have-nots, the flagships versus foundering ships, larger and older campuses versus the younger and smaller. These terms are simply synonyms for the fragmentation of the UC system by campus self-interest.
WHAT IS TO BE DONE?
Now is the time to proceed deliberately with budget reform. Both the Senate and the Administration, (the latter in the November, 2010 Commission on the Future Report, commissioned by President Yudof) have endorsed the value of UC as one university, and if we mean that we are one university, we need to stand by that value in defining principles for budgeting.
The whole Rebenching effort should be viewed as the UC systemwide version of “Let no budget crisis go to waste.” This is a moment when campuses will demonstrate that they set policy by principle, not by adherence to local needs and desires alone. How Rebenching will end, whether with greater transparency and equity in budgetary allocations across the system, and whether from any principled basis at all, is still an open question.
With student protests across campuses, UC may finally have the necessary conjunction of external and internal budget efforts: the ReFund California/student protests are looking to Sacramento, where the pattern of disinvestment in higher education originates and can be solved, while OP is looking inward through Rebenching to the single greatest choice in the university’s financial control, the allocation of our state funds. Together, these forces may finally be in sufficient alignment that real change can occur.
Susan Gillman Chair, Santa Cruz Division, Academic Senate