UC Per Student Spending Reaches Historical Low; Admin at All Time High

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By Jerika L.H

2015-2016 Public Policy reports indicate that the average per student state spending for UC and CSU has reached historical lows – just half of what it was in the year 2000. This deficit in per student spending has gone from $16,200 to $8,280 in the past sixteen years.  The 54% decline in student allocations correlates with a rise in student loan debt, which is currently at a UC average of $20,210.

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UC tuition is presently at $13,456, making it “the largest single source of core operating funds.” Students contributions comprise $3 billion in tuition and fees, while the state comes in below that at $2.38 billion.

Ironically, the University of California enjoyed free tuition for almost a hundred years since its 1868 inception. The founding charter states: “For the time being, an admission fee and rates of tuition such as the Board of Regents shall deem expedient may be required of each pupil; and as soon as the income of the University shall permit, admission and tuition shall be free to all residents of the state.”

Nominal fees were introduced in the 1950s, when in-state tuition was capped at $86. Tuition rose to $300 in 1968 and then dropped to $150 in 1970. Rates quadrupled in the late 70s, and then doubled again in the 80s at $1,296. By the early 2000s, tuition was set at $3,086.

Given the current rate, this past decade has experienced a 220% increase in tuition from the decade prior. The astronomical rise in tuition fees coupled with slashed state spending has resulted in difficult financial standings for students. The current statistics on student debt in the U.S is 1.2 trillion dollars, with 7 million students in default of their loans.

Yet, not everyone is suffering from the onset of austerity policies in education. $41.3 billion in profit is made annually off student loans.

In addition, the UC has experienced an unprecedented expansion of its administration, which has more than tripled since the year 2000. The number of faculty has only slightly increased despite a boom in enrolled students.

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In that same vein, more administration means more administrative spending, as well as more employees under the purview of the Chancellors – a key point which allows the UC Regents to increase Chancellor salaries, which have reached all-time highs in recent years.

Newer Chancellors are now making up to double what their direct predecessors were making just years before them. In fact, the discrepancy in Chancellor pay is what prompted UC Regents to approve a 20% increase in Chancellor salaries in 2014, despite numerous cuts to faculty payrolls.

The Regents called this increase a measure to “correcting injustices,” despite the fact that all the UC Chancellors fall within the top 1% of national earners while many faculty members are struggling to get by under current wages.

Janet Napolitano noted that the pay increases were justified under the grounds that UC was willing to pay for “world class leadership”– a comment that is now being called into question amidst Chancellor Katehi’s current ethical scandal.

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7 thoughts on “UC Per Student Spending Reaches Historical Low; Admin at All Time High”

  1. ContextMatters

    This article misses the point that state funding has rapidly declined over the same time period. As state funding declines, the university must increase research to support its activities. This increases the pressure on research productivity and changes the balance between teaching and research.

    Quite frankly, it is shameful that we – state citizens – are allowing this massive higher education infrastructure to decline over time because the people of CA do not want to pay approximately $31 per year more in – yes, that ugly word – taxes.

    The continuing decision to reduce state funding is racist. Legislators – mostly white – and a Gov – also white – benefited from the university. Now they continue the recent tradition of reducing state funds just as the state becomes a minority-majority state.

    Isn’t that interesting and worthy of protest?

    1. Barack Palin

      The continuing decision to reduce state funding is racist. Legislators – mostly white – and a Gov – also white – benefited from the university. Now they continue the recent tradition of reducing state funds just as the state becomes a minority-majority state.

      Sorry CM, I agree with much of what you wrote on the other thread, but this is crap.

  2. Tia Will

    CM

    Quite frankly, it is shameful that we – state citizens – are allowing this massive higher education infrastructure to decline over time because the people of CA do not want to pay approximately $31 per year more in – yes, that ugly word – taxes.”

    With this portion of your post, I am in complete agreement. The remainder, not so much so.

    1. Frankly

      I found it here.

      Of course this is from the UC Board of Regents report.  So consider the source.

      And there are other points to be gleaned from this report.

      One is the graph that shows the state-maintained facilities and the non-state-maintained facilities.  I have some big questions about that graph because it shows that during the 1990s there was a bunch of non-state maintained space, but then it drops precipitously in the 2010s bar… which indicates that the UC budget actually absorbed the maintenance costs of space that was previously off-budget.

      This gets to one of the key considerations of escalating costs for UC operations… the building and maintaining of all the ego shrines.

      It is my belief that, although these ego shrines are build with outside private donations, the cost of maintaining them and the cost of administration for them, is absorbed within the operating budget of the UC campus.

      Then look at Display 20 on this report.  Note that the “Remaining $705M Gap” is about the same size as the list of “New Costs” which are basically the increase in personnel costs including employee retirement and health care benefits.  My guess is that if this gap in spending was broken down it would be close to 100% of these things.

      And this report only goes back to 2001.  And because of this it fails to tell the entire story.  The entire story is that through the 1980s and 1990s the UC system, like much of state government, when on a spending tear hiring thousands of more state employees, and increasing their pay and benefits… but primarily their benefits because at the time the economy was cooking and private sector employees tended to make a bit higher wages.  But much of this economic expansion was fake… it was based on a bubble of overheated real estate values and the heat of the investment market from over-heated secularized junk debt instruments for real estate.  So in started to correct starting with the first recession in 1990-1991 and then again in 2001 and then the big one in 2007.

      However, the state never corrected.  It in fact memorialized the over compensation practices… partially because the unions were smart enough to know that the gravy train would end and they worked to get legal protection for their unfunded pay and benefit commitments.

      The decline in state contribution to public service is a direct consequence of having too many state government employees that are paid too much… specifically their retirement and healthcare benefits.  Until we fix that, we will continue to see a decline in services to the general public.

      Take your pick… either you support state employees retiring in their 50s with a millionaire pension or you support maintaining public services from government.

       

  3. Anon

    Janet Napolitano noted that the pay increases were justified under the grounds that UC was willing to pay for “world class leadership”– a comment that is now being called into question amidst Chancellor Katehi’s current ethical scandal.”

    Yes, paying more does not necessarily result in better quality…

    1. Barack Palin

      This always cracks me up.  The mantra that we must pay more for more talented leadership as a justification for exorbitant wages.

      It reminds me of  judges giving the okay for bankrupt companies to give out more pay and goodies in order to keep their officials from leaving, the same officials that guided the company into bankruptcy in the first place.

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