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?
Thanks
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.
Judy
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
Showing posts with label michigan model. Show all posts
Showing posts with label michigan model. Show all posts
Wednesday, August 12, 2009
Hollinger Response to Newfield
Since Colleen Lye invited Christopher Newfield to comment specifically on my post of August 8, I suppose I should offer a perspective on his comments as they are now posted on this list. I find three things of significance, but before I state them I want to observe, for colleagues who may not have heard of Newfield, that he (a Professor of English at the Santa Barbara campus) is the author of two books on the political economy of higher education. He has earned our attention because he has actually studied the recent history of universities, nationally as well as within California. First and most important, Newfield’s comments are best seen as another item for the file, “items to be considered by any task force studying a possible increase in out-of-state enrollment and/or a possible reconfiguration of Berkeley’s relation to the UC system as a whole.” Many of his points are pertinent, and they sharpen some of the questions that several contributors to this list have already raised. His message contains no surprises. Second, Newfield’s sense of what the public needs to know about UC and its direction should be supplemented with an abundance of information beyond the simple fact that increased out-of-state enrollment will mean fewer places in UC for California residents. If that’s all that were said to the public, there is no doubt that support for such a move would be close to zero. Newfield is on more productive ground when he calls for UCOP to make a more vigorous and sophisticated effort to vindicate the role of the University of California in the life of the state. Third, Newfield’s comments are significant for their silences. While he comes out of the tradition of holding to the “one university” way of thinking, and sometimes hints that Berkeley is complacent about its situation and its prospects, Newfield stops well short of the conventional blasts at Berkeley (Ron Hendel’s posting about his experience on a systemwide committee is a convenient bit of testimony; I was on two such systemwide committees and experienced similar dynamics) for being aloof from the other campuses and from the public. And while Newfield provides the standard list of things we need to be afraid of if we take the slightest additional steps toward “privatization,” he does not allege that it is silly of us to perform the analysis that many of us have said needs to be performed, and he is sufficiently cognizant of the difficulties within UC and within the politics of California to refrain from castigating us for trying to think outside the prescribed box. As a major author of an Academic Council document that I had characterized as next to useless, moreover, Newfield takes the criticism collegially rather than responding defensively. Overall, then, I welcome Newfield’s comments, and I don’t see that we at Berkeley have any reason to be dismayed by them.
By way of postscript, I want to voice a caution about one possible course of action that Newfield mentions: going to Sacramento by the busload to talk face-to-face with legislators. I am not sure UC faculties as a whole, or even the Berkeley faculty in particular, are sufficiently of one mind to carry this off effectively. And if it were done at cross-purposes with UCOP and/or at cross-purposes with Bob Birgeneau and George Breslauer it might even make things worse. Any of us as individual citizens are of course free to do whatever we think is right and to join any lobby group we wish, but insofar as we present ourselves to the state legislature as representatives of the faculty we would need to be clear about the capacity in which we were speaking, and in what relation to our Divisional Senate, and about just what the core message is supposed to be. Wildcatting can be dangerous to the cause, however much satisfaction it brings to the wildcatter. I doubt if Newfield would disagree with this caution.
--David Hollinger
By way of postscript, I want to voice a caution about one possible course of action that Newfield mentions: going to Sacramento by the busload to talk face-to-face with legislators. I am not sure UC faculties as a whole, or even the Berkeley faculty in particular, are sufficiently of one mind to carry this off effectively. And if it were done at cross-purposes with UCOP and/or at cross-purposes with Bob Birgeneau and George Breslauer it might even make things worse. Any of us as individual citizens are of course free to do whatever we think is right and to join any lobby group we wish, but insofar as we present ourselves to the state legislature as representatives of the faculty we would need to be clear about the capacity in which we were speaking, and in what relation to our Divisional Senate, and about just what the core message is supposed to be. Wildcatting can be dangerous to the cause, however much satisfaction it brings to the wildcatter. I doubt if Newfield would disagree with this caution.
--David Hollinger
UCB and Problems with MIchigan Model
by Chris Newfield
I agree with Hollinger that the Michiganization of UCB should not be dismissed out of hand, and with a milder version of what he says about the Futures Report, which is that a deeper study of that case needs to be done (we had real trouble getting historical data on UM). The debate at Berkeley won't move forward until a real study is done. But such a study would need to be done with real rigor about UCB's actual costs and funding sources, including its higher-than-system-average share of state GF and the dependence of its professional schools on even larger subsidies. The public also needs to be told very clearly about the implication: all other things being equal, UC as a system would reserve fewer spaces for California students, and even fewer of them would go to Berkeley than they do now.
I don't think there's any direct personal benefit to UCB faculty for being part of the UC system, except for pension and benefits. Faculty make their own relationships and could do this with Cal State Davis just as easily as UC Davis. So simple personal self-interest isn't a good argument for keeping Berkeley in UC.
On the other hand, there is an institutional benefit. UCB benefits budgetarily by being in the system because it gets more money per student FTE from the state than do all but 2 other campuses (both medical) - see the attachment, from a UCPB project I started that ran out of time before we could clean the numbers. This is the result of the 1996 "block grant" budget change that grandfathered in the old system of giving much more money per grad student than per undergrad, so the high-grad campuses benefited enormously (esp UCLA).
Michigan: a very mixed bag for Michigan and may not be duplicable for Berkeley EXCEPT on bad budgetary terms. Considerations:
- the Regents don't have the guts to raise fees to Michigan levels and keep raising them. So the only meaningful revenue stream won't be big enough.
- they don't have the guts for one good reason: increasing tuition a lot will reduce GF by a lot. The "backlash" happened in Michigan and it has been very bad recently.
- U Mich had virtually no competition for higher ed research subsidy dollars in its entire state (MSU is more complementary than say UC Davis is to UCB). UCB just isn't in a comparable position in California.
- the privatization model is also broken - faculty really need to notice this. When you start down that road, you need to compete with your new rich peers to attract "blue chip" students with "merit-based" scholarships, intensify star-system bidding for faculty, bloat your non-teaching staff even more (better student services, more development people, more industry liasoning, etc. etc.) and have new Duke-like facilities rather than student centers that starred 45 years ago in documentaries about the free speech movement when they looked a whole lot better. Costs go up, as do tuition discount rates. All this likely means little or no net revenue increases. As to increases in non-resident tuition - I still haven't had time to do the figures, but I see small improvements on the margins of campuses of whatever size.
I encourage faculty to go far enough with the privatization scenario for Berkeley such that they actually run the numbers - at the UC GF average, not Berkeley's built-in advantage, with demand elasticity models that account for how increased price will affect demand, with a model for impact on diversity and Pell Grant students, and with proper accounting for "customer" expectations at the new price point - smaller classes, more office hours, better technology, nicer buildings, windows that get washed, etc.
Rather than taking the longstanding Berkeley position during downturns - well, we'd like to leave UC, which holds Berkeley back, but well, ok, we'll stay as long as you acknowledge what a burden this is for us by giving us something (grandfathered grad-based GF shares in 1996, higher fees in 2010?) - why not do the full modeling of the new Cal Berkeley, starting with the simple proposition that it not lose its GF, and would stay public in that sense, but would go forward with the system average GF per student? Berkeley would then work with all its current assets and liabilities - reputation, location, more self-determination, etc.; also a law school whose costs Edley has raised quite a bit, BLNL, an expensive CalISI that has never broken even, growth restrictions and enrollment caps, a physical plant to be compared to Stanford and MITs and not to UCLAs, etc. There are many unknowns, Hollinger et al rightly point out, and a study would help reduce their number. Your Senate's budget committee would perform a real service here. People who are in a position should ask for the spreadsheets that will show how the money really does flow. In my experience chairing UCPB, you're likely to run into the kind of discourse "we in administration have tried to understand our own accounting systems and can't," but you should keep trying. The big skeletons in the closet include: 1) student fees subsidize the indirect costs of research (I don't agree with Schwartz's philosophical hypostases of the categories but his figures are a good starting point); 2) campuses subsidize the professional schools. And there are no doubt others.
I agree with Hollinger that the Michiganization of UCB should not be dismissed out of hand, and with a milder version of what he says about the Futures Report, which is that a deeper study of that case needs to be done (we had real trouble getting historical data on UM). The debate at Berkeley won't move forward until a real study is done. But such a study would need to be done with real rigor about UCB's actual costs and funding sources, including its higher-than-system-average share of state GF and the dependence of its professional schools on even larger subsidies. The public also needs to be told very clearly about the implication: all other things being equal, UC as a system would reserve fewer spaces for California students, and even fewer of them would go to Berkeley than they do now.
I don't think there's any direct personal benefit to UCB faculty for being part of the UC system, except for pension and benefits. Faculty make their own relationships and could do this with Cal State Davis just as easily as UC Davis. So simple personal self-interest isn't a good argument for keeping Berkeley in UC.
On the other hand, there is an institutional benefit. UCB benefits budgetarily by being in the system because it gets more money per student FTE from the state than do all but 2 other campuses (both medical) - see the attachment, from a UCPB project I started that ran out of time before we could clean the numbers. This is the result of the 1996 "block grant" budget change that grandfathered in the old system of giving much more money per grad student than per undergrad, so the high-grad campuses benefited enormously (esp UCLA).
Michigan: a very mixed bag for Michigan and may not be duplicable for Berkeley EXCEPT on bad budgetary terms. Considerations:
- the Regents don't have the guts to raise fees to Michigan levels and keep raising them. So the only meaningful revenue stream won't be big enough.
- they don't have the guts for one good reason: increasing tuition a lot will reduce GF by a lot. The "backlash" happened in Michigan and it has been very bad recently.
- U Mich had virtually no competition for higher ed research subsidy dollars in its entire state (MSU is more complementary than say UC Davis is to UCB). UCB just isn't in a comparable position in California.
- the privatization model is also broken - faculty really need to notice this. When you start down that road, you need to compete with your new rich peers to attract "blue chip" students with "merit-based" scholarships, intensify star-system bidding for faculty, bloat your non-teaching staff even more (better student services, more development people, more industry liasoning, etc. etc.) and have new Duke-like facilities rather than student centers that starred 45 years ago in documentaries about the free speech movement when they looked a whole lot better. Costs go up, as do tuition discount rates. All this likely means little or no net revenue increases. As to increases in non-resident tuition - I still haven't had time to do the figures, but I see small improvements on the margins of campuses of whatever size.
I encourage faculty to go far enough with the privatization scenario for Berkeley such that they actually run the numbers - at the UC GF average, not Berkeley's built-in advantage, with demand elasticity models that account for how increased price will affect demand, with a model for impact on diversity and Pell Grant students, and with proper accounting for "customer" expectations at the new price point - smaller classes, more office hours, better technology, nicer buildings, windows that get washed, etc.
Rather than taking the longstanding Berkeley position during downturns - well, we'd like to leave UC, which holds Berkeley back, but well, ok, we'll stay as long as you acknowledge what a burden this is for us by giving us something (grandfathered grad-based GF shares in 1996, higher fees in 2010?) - why not do the full modeling of the new Cal Berkeley, starting with the simple proposition that it not lose its GF, and would stay public in that sense, but would go forward with the system average GF per student? Berkeley would then work with all its current assets and liabilities - reputation, location, more self-determination, etc.; also a law school whose costs Edley has raised quite a bit, BLNL, an expensive CalISI that has never broken even, growth restrictions and enrollment caps, a physical plant to be compared to Stanford and MITs and not to UCLAs, etc. There are many unknowns, Hollinger et al rightly point out, and a study would help reduce their number. Your Senate's budget committee would perform a real service here. People who are in a position should ask for the spreadsheets that will show how the money really does flow. In my experience chairing UCPB, you're likely to run into the kind of discourse "we in administration have tried to understand our own accounting systems and can't," but you should keep trying. The big skeletons in the closet include: 1) student fees subsidize the indirect costs of research (I don't agree with Schwartz's philosophical hypostases of the categories but his figures are a good starting point); 2) campuses subsidize the professional schools. And there are no doubt others.
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