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State budget gives lift to UCD, students

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From page A1 | June 16, 2013 |

The budget approved by the Legislature this weekend brings future tuition relief to students and puts UC Davis in position to get its finances back into the black.

It includes tuition discounts for students from families earning $80,000 to $150,000 a year.

The campus, meanwhile, estimates it will receive a $39.3 million increase in general funds — a vast improvement from having its funding slashed by 40 percent from 2007-08 to 2012-13.

Sen. Lois Wolk, D-Davis, said Saturday that while “it isn’t perfect,” the $96.3 billion budget package represents a “glimmer of what it might be like” when the state’s economy is healthy. Gov. Jerry Brown is expected to sign the budget.

“Every single year in January, we had the terrible, terrible prospect of dramatically reducing services and seeing tuition be raised. That hung over the entire process,” Wolk said.

“There’s been a real turnaround. One of my colleagues said, ‘California is back.’ There’s a ways to go, but it’s light-years different than the last 10 years. It’s all thanks to the people of California (for voting to approve tax increases).”

Assemblywoman Mariko Yamada, D-Davis, called the budget “responsible, reasonable and restrained.”

It “honors voter intent to reinvest in students of all ages,” she said. “After years of draconian cuts and dramatic fee hikes, a partial restoration of higher education funding for the UCs and (California State University) provides a welcome breath of fresh air.”

The approved “middle-class scholarship” plan will start with the 2014 school year.

It builds on the existing Blue and Gold Plan, under which UC covers tuition and fees for students whose families with annual incomes of up to $80,000. This spring, UCD also announced a new Aggie Grant Plan to cover at least 25 percent of tuition and fees (about $3,000 annually) to students with family incomes between $80,000 and $120,000.

The approved budget brings a $125 million buyout of tuition increases for 2013-14 and a $125 million, or 5-percent, increase in base funding to the UC system. It directs $10 million toward online education, $15 million to the UC Riverside Medical Center.

The budget also:

* allows UC to restructure its debt, saving the system an estimated $80 million per year;

* gives UC more flexibility to pursue capital projects, if they receive Department of Finance and Joint Legislative Budget Committee approval.

The Davis campus looks to end next year with an $8.3 million structural deficit — two fiscal years after being a record $125 million in the hole.

UCD has closed that gap, in part, through widespread cuts, consolidating support functions like human resources and information technology, eliminating faculty positions through attrition and an energy efficiency program.

Along with the increase in state dollars, the campus budget has received an $18.2 million boost from enrollment growth and by increasing the percentage of higher-paying international and out-of-state students.

“Compared to how it has been? This is fully manageable,” said Kelly Ratliff, UCD’s associate vice chancellor for budget resource management, on Friday.

UCD might have erased its shortfall altogether, but the university has announced that non-union staff and faculty will receive a raise effective July 1. Academic appointees will receive a 2 percent boost and staff an average of 3 percent.

In a letter on June 7, Chancellor Linda Katehi said that was important because state cuts have “proven particularly burdensome” on non-represented employees, who had received one raise in the past five years.

The raises are also intended to partially offset increased retirement and benefit costs, she wrote.

Top management, like the chancellor and vice chancellors, coaches on multi-year contracts and union-represented employees are among those not included. A number of union contracts are under negotiation.

UCD’s budget, which is nearing completion, calls for the provost’s office to put $12.3 million into salary increases, $5.3 million for faculty merit pay and $2 million to help cover instructional needs of a growing number of students.

Under UCD’s new “incentive-based” budgeting, colleges and professional schools are allocated funds based on student credit hours, majors and degrees awarded.

Colleges, schools and other units will foot the $11.4 million bill for the increased costs of employee benefits.

“The university’s costs related to salary and benefits have exceeded the amount of new funding from the state, so other things have to happen,” Ratliff said. “So part of what’s happening is some enrollment growth and different types of students. Some of what’s happening is (that) while you’re adding money, you’re asking (units) to absorb an expense.

“We’re still way, way better off than we were.”

The plan also calls for the provost’s office to spend $10 million on a handful of student-oriented initiatives, including more money for graduate student fellowships, student advising, services for international students, improving classrooms, student employment and online education.

The campus’ annual base budget of tuition and state general funds totals more than $750 million.

UCD’s future budgetary priorities will include building back up its $6.8 million reserve and bracing for planned growth of 5,000 students and 300 faculty by 2020.

The governor has promised three more years of funding increases for UC: 5 percent in 2014-15 and 4 percent in each of the two subsequent years.

— Online: http://budget.ucdavis.edu

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Cory Golden

Cory Golden

The Enterprise's higher-education and congressional reporter. http://about.me/cory_golden
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