Davis proposes UC fee hike

Faced with a shortfall of $34.6 billion dollars, Gov. Gray Davis unveiled his 2003-04 budget proposal on Jan. 10, which includes an additional increase to student fees at the University of California.

According to the new proposal, resident undergraduates at the University of California will pay an additional $795 per year in student fees, while resident graduate student fees will increase by $855.

The proposed increase, if added to the mid-year increase of $135 per quarter approved by the UC Board of Regents in December 2002, would raise fees for undergraduate residents to $4,629 per year. Before the $135-per-quarter increase, which will be effective spring 2003, student fees had not been raised since 1994.

One-third of the increase will be funneled directly to financial aid, UC spokesperson Brad Hayward said. The Board of Regents instituted the policy of returning one-third of all fee increases to financial aid in the early 1990s, when California suffered another economic downturn. Hayward said the money allocated to financial aid should allow students from all financial backgrounds to attend the university in light of the fee hikes.

“”It’s obviously very important for the university to remain accessible to lower-income students,”” Hayward said. “”Between the increased financial aid offered by UC and the governor’s proposal to increase funding to Cal-Grants, students getting financial aid grants should essentially be covered.””

According to the university, Davis’ new budget proposal furthers the University of California’s funding shortfall to almost $1 billion, where over $500 billion has been slashed from funding and another $400 million-plus in state-university partnership funding of staff and faculty pay increases has been forgone since 2001-02. Budget analysts for the University of California say the fee increase will net an extra $179 million this year and next, covering less than 19 percent of the university’s total budget shortfall.

Other departments affected by Davis’ most recent round of cuts include a $36.5 million reduction to administration and libraries, a $33.3 million reduction to educational outreach programs and $28.8 million across-the-board cut to research. Student services, or programs funded by campus-specific registration fees, would be cut by $19 million in 2003-04 across the UC system, although the reductions will be allocated to campuses which will decide locally how to make their cuts.

The governor, looking for ways to replenish California’s shortfall, introduced several other sources of state revenue, including a 1-cent hike on sales tax, doubling the cigarette tax levied to about $2 a pack and raising income taxes to 11 percent for California’s wealthiest citizens.

The California state sales tax is currently 6 percent, although most counties tack on more to the tax to fund local programs and services. The 1-cent increase was proposed by Davis to aid county and local governments by $4.5 billion in funding for some of the new responsibilities — such as long-term health care, mental health services and child abuse prevention — they would take on under the proposal. Sales tax is currently 7.75 percent in San Diego County.

California households making between $260,000 and $520,000, as well as single payers making between $130,000 and $260,000, currently pay 10 percent in state income tax, but would pay 11 percent if Davis’ proposal were enacted.

Cigarettes are currently taxed 87 cents per pack, and Davis’ proposal would raise the levy to $2 per pack. A similar cigarette tax increase to $3 per pack was proposed by Assembly Speaker Herb Wesson (D-Los Angeles) in summer 2002 to solve the 2002-03 budget crisis, but failed to pass.

Hillary McLean, a spokesperson for Davis, says that “”the shortfall has been caused by a variety of problems,”” citing the national economic slowdown while emphasizing that the “”dot-com crash”” of Silicon Valley high tech companies has slowed California’s problems further than most states.

While Davis has argued that cuts alone are not enough to close the increasing budget gap, Republicans accuse the governor of overspending during a time of sluggish economic growth.

“”For four years, [Democrats] have enacted an unprecedented spending spree with taxpayer dollars,”” said assemblyman John Campbell (R-Irvine) in a Jan. 15 statement. “”This is precisely the reason California is facing a record multibillion-dollar deficit.””

In light of the deficit causing fees to be raised, UC President Richard C. Atkinson hopes access to the university’s education will not suffer during the turbulent economic times, and that quality is maintained despite budget cuts.

“”A fee increase is always difficult,”” said Atkinson in a Jan. 10 statement. “”At the same time … it acknowledges the need for a balanced package of solutions if we are to preserve access and quality in the student instruction program, which is our highest priority.””

The Board of Regents met on Jan. 15 for a regular meeting. Hayward said that he doesn’t expect the Regents to vote on a fee increase until the board meets in May.