More than one-third of UC undergraduates -- generally those whose family incomes are below $60,000 per year and are considered needy under federal standards -- would not have to pay the increase, as it would be fully covered by a federal grant, Cal Grant or UC grant.
The Regents' 16-3 vote on student fees came the day after Gov. Arnold Schwarzenegger released the May Revision to his January state budget proposal. The May Revision restores $98.5 million of the UC funding that the January budget proposed cutting, a change welcomed by the university, but still falls short of covering the university's operational needs for 2008-09.
The May Revision essentially would leave UC's state-funded budget for 2008-09 at the same level as in 2007-08, without providing funding for enrollment growth, inflationary cost increases or investment in high-priority needs such as expanded student mental health services. Both spending cuts and student fees will be needed to address the shortfall.
"We very much welcome the governor's proposal to restore some of the funding for public higher education that had been proposed for cuts," said UC President Robert C. Dynes. "Our state's public colleges and universities are a great investment for the state because they are an investment in students and in economic growth for California. I thank the many advocates who have been carrying this message to our state's leaders in recent months.
"However, the May Revision still does not meet all of the university's needs for the upcoming year. Our enrollment is growing, and our costs, like everyone's, are increasing with inflation.
"The decision to raise student fees is always an agonizing one. But given the current state budget situation, these increases are necessary as one part of our effort to preserve the quality and accessibility of the university's programs to the greatest extent possible. We will continue to place a high priority on student financial aid as part of our commitment to affordability. We will take a significant portion of the income from this fee increase and return it straight to financial aid, and an increase in Cal Grant awards at the state level will assist many students as well."
The January budget proposed a funding increase for UC consistent with the governor's compact with the university, then applied a 10 percent, or $332 million, reduction. The May Revision proposes restoring $98.5 million of that cut, leaving state funding for the university in 2008-09 roughly equivalent to the 2007-08 level.
However, funding is not provided in the May Revision for key needs that the Regents had included in their 2008-09 budget request, including funding for enrollment growth, faculty and staff salary increases, and other inflationary cost increases. In addition, the university is seeking an $8 million increase in funding for student mental health services on campuses, a priority endorsed by both the Regents and UC student organizations.
The student fee increases -- which will generate approximately $70 million for university operations after funds for student financial aid are set aside -- will help make up for a portion of the gap in state funding that remains between the proposed level and the level needed to address the university's operational needs in 2008-09.
A portion of the registration fee increase, for example, will help meet one of the highest priorities endorsed by both the Regents and UC student organizations -- increasing funds for student mental health services by $8 million in 2008-09.
Other actions to close the budget gap at UC have yet to be determined, but approximately $68 million is expected to be realized through savings in administrative spending. As part of that effort, the Regents today approved a 2008-09 budget for the Office of the President that reflects a budget cut of 10 percent and another 10 percent in programs that will be relocated outside the Office of the President.
Under the Regents' student fee action, starting in summer 2008 mandatory universitywide fees will increase by 7.4 percent, or $490 per year for resident undergraduates and $546 for resident graduate academic students. The increase consists of a 7 percent increase in the educational fee and a 10 percent increase in the registration fee.
The systemwide fee for most professional students will also rise by 7.4 percent, or $486. In addition, increases in professional schools fees approved by the Regents in September 2007 will take effect in summer 2008.
For undergraduates, the university will return an amount equivalent to 33 percent of revenues generated by the fee increase to financial aid. This "return to aid," when combined with federal grant aid and the state's Cal Grant program, will allow UC to provide additional financial assistance to UC grant recipients who are considered needy under federal eligibility standards and whose family incomes are generally lower than approximately $60,000 per year.
UC will also provide a grant covering approximately 50 percent of the fee increase to other needy on-time financial aid applicants whose family incomes are below $100,000 per year.
Other provisions will make available a 50 percent return-to-aid for graduate academic students and a 33 percent return-to-aid for professional school students.
The new fees also include the continuation of a temporary $60 surcharge originally approved in July 2005 to address the loss of revenue stemming from the Kashmiri class-action lawsuit filed primarily by professional students who claimed their fees had been improperly raised. This temporary fee will be assessed to all students until such time as the university's costs associated with the final court-determined judgment in the Kashmiri case are fully repaid.
Detail on 2008-09 student fees
Undergraduate students: Mandatory systemwide student fees will increase by 7.4 percent above the current fee level. For resident undergraduates, this means fees will rise by $490. All enrolled students will also pay the temporary $60 surcharge. The increase will bring total mandatory systemwide fees for resident undergraduates to $7,126. With additional miscellaneous fees charged by individual campuses, their average systemwide fees will total approximately $8,007.
Graduate students: Mandatory systemwide fees for resident graduate academic students will also increase 7.4 percent, or $546 per year, in 2008-09. In addition, all enrolled students will also pay the temporary $60 surcharge. This will bring the total mandatory systemwide fees for resident graduate academic students to $7,986. Adding in miscellaneous campus fees, their average total fees will total approximately $10,376.
Professional students: In addition to increases in the professional degree fee approved by the Board of Regents in September 2007 (see www.universityofcalifornia.edu/regents/regmeet/sept07/j3display1.pdf), mandatory systemwide fees for professional students will increase by 7.4 percent, or $486 a year for most students paying professional school fees. Additionally, all enrolled students will also pay the temporary $60 surcharge. This will bring the mandatory systemwide fees for most professional students to $7,068. Increases for professional degree students enrolled in public health, public policy, and the International Relations and Pacific Studies program at UC San Diego will, however, pay the $546 increase plus $60 surcharge paid by graduate academic students.
Nonresident tuition: In addition to mandatory systemwide fees, out-of-state students must pay nonresident tuition. The nonresident undergraduate tuition will increase by 5 percent in 2008-09, raising nonresident tuition by $953, from $19,068 to $20,021. Nonresident tuition will remain at $14,694 for graduate academic students and $12,245 for professional students. Taken together with mandatory systemwide fees and campus fees, nonresident student charges in 2008-09 will total $28,615 for undergraduate students and $25,380 for graduate academic students.
Some national comparisons
Even with the fee increase, total charges for resident undergraduate and graduate academic students are expected to remain well below the average fees charged at the University of California's four public salary comparison institutions (University of Michigan, University of Illinois, University of Virginia and SUNY Buffalo).
The comparisons for nonresident students are a different matter. The university's fees for nonresident undergraduate and graduate students currently exceed the average fees for the comparison institutions. Even so, the university's tuition and fees for nonresident students continue to represent the mid-point among the public salary comparison institutions. The university expects to retain these relative positions among its comparison institutions even with these increases.