Actions needed
UC: An investment not an expenditure
As a UC advocate, we wanted to keep you informed of the unfolding California budget situation. Earlier this month, Gov. Arnold Schwarzenegger released his budget proposal. The governor’s proposal would increase funding under his "compact" with the UC system but then apply a reduction of $332 million, or 10 percent.
The governor’s budget reflects the fact that the California and national economies faced considerable headwinds in 2007 — a deepening housing slump, a breakdown in mortgage markets, tighter credit, more volatile financial markets and rising energy prices. Amid such economic turmoil and uncertainty, it is comforting to know that UC is an investment in the future. That is because as a public institution, UC recognizes that public service is at the heart of our mission to the people of California. Indeed, one thing is certain as policy and decision-makers look for a way forward – the return on investment that is the University of California has never been stronger.
In 1970, UC received about 7% of the state’s general fund budget. Today, the figure has fallen to below 4%. Without state investments in the University, hard choices about UC programs and services will need to be made. Here’s what’s at stake:
Preserving student access:
- UC has the highest percentage of low-income students among comparable universities.
- UC receives more freshman applications than any other university in the country.
- UC enrolls a larger number of low-income students than do comparable public or private universities.
- UC awards more than 40,000 bachelor degrees every year.
Research dollars for California:
- For every $1 in state research funding, UC secures $4 more in federal/private research funds.
- UC is the nation’s top university in attracting federal R&D investment.
California ’s economic growth:
- Nearly 400,000 jobs in California are dependent on UC operations (not including spin-off companies), and UC is expected to have a hand in creating more than 2 million California jobs this decade.
- UC contributes more than $14 billion in California economic activity and more than $4 billion in state and local tax revenues each year.
- UC develops more patents than any other university -- 12 years in a row -- UC researchers produce three new inventions a day.
- More than 1,000 California biotech, high-tech and other innovative companies put UC research to work every day.
- UC faculty and alumni have founded 1 out of every 4 biotech companies in California, while nearly 60% of the state’s IT and communications firms have UC alumni as executives.
- UC awards 7% of the nation’s Ph.D. students, much more than its competitors like Harvard, Yale, Stanford and other Ivy League universities.
Clearly, now more than ever, UC is a good investment for California because of the impact we have, and that economic growth starts with the work done at UC. UC is an investment not an expenditure — these inventions and many more would be impossible without investing in UC. While no decisions have been made at UC, a cut of the magnitude proposed could require all of the following (or alternatives that would save equivalent dollars):
- No enrollment growth, affecting up to 5,000 student applicants;
- A student fee increase of 10 percent or higher, up from the 7 percent previously discussed;
- Elimination of most increases for employee salaries and health benefit costs, including for lower-paid employees;
- A halt to a multiyear plan to rebuild the competitiveness of faculty salaries;
- A halt to a multiyear plan to improve support for graduate students.
The university recognizes that the budget process will not conclude for many months; however, a s state officials look ahead to this year’s budget decisions, let them know that the University of California, California State University and California Community Colleges should be a top, long-term priority for shaping our state’s future and getting the California economy back on track. We will keep you informed about these budget developments in the near future.
