A tax passed by the UC Board of Regents may cause student fees to go toward funding the UC Office of the President. The Regents passed the tax, known as the Funding Stream Initiative, in July 2011 with the goal of increasing financial transparency.
Before, revenue generated by each campus went through UCOP, which took a 6-percent share and redistributed the funds back to the campuses.
This revenue came from Core Funds, which includes sources such as medical centers and grants and contracts, but did not include
campus-based fees, such as sports fees and college activity fees.
Now, revenues will remain on the campuses they originate from, and UCOP will gain funds through a 1.69-percent flat tax of all campuses.
The chancellors and vice chancellors of the universities can choose when to implement the tax and how much to draw from each funding source to meet the total 1.69 percent. Student fees may be included as a funding source.
“The impact on campuses will vary from one to another because they don’t have exactly
the same revenue sources,” UCOP spokesperson Shelly Meron wrote in an email. “For example, some UCs have medical centers, some have less research, some have more professional schools, etc. All of that affects campus-level revenues, and by extension affects what funds will be assessed and what impact this will have.”
The chancellors of UC Riverside and UC Santa Barbara have already instituted the tax, with Riverside paying 2 percent of its overall revenue. UC Santa Barbara Stu
dent Affairs now owes $700,000 to UCOP, leading UCSB Student Affairs to ask the student council to pay anywhere from $99,000 to $180,000. UCSB’s council has frozen student org funds until further notice. The Davis A.S. council faces an estimated $250,000 reduction to its annual budget.
The A.S. Councils of UC Riverside and UC Merced have passed resolutions criticizing the inclusion of student-initiated fees in the Funding Streams Initiative.
Associate Vice President of Academic Affairs Sammy Chang brought up the new tax at council’s April 25 meeting.
“Action must be taken or there will be fiscal disaster,” Chang said during his April 25 presentation to council.
According to Chang, the tax will go into effect at UCSD starting Fall 2012. The tax did not affect UCSD this year because the university’s annual budget was set by the time the UC Regents passed the tax.
Chang added that council plans to inform students about the tax and petition Vice Chancellor of Student Affairs Penny Rue to ask her not to include student fee funds in the tax.
Chancellor Marye Anne Fox has voiced support for the tax, but has also proposed some alterations — such as a reduction in the 1.69-percent total taxation rate.
UCOP hopes that this will eventually reduce fees for students, even if they have an increased financial burden in the present.
“I believe the outcome of the Financial Streams Initiative will enhance transparency and will help set the 10 campuses on a path towards continued excellence in the coming years,” UC President Mark Yudof said in a Sept. 12 memo addressed to UC chancellors and budgeting staff.
