Gov.’s Budget Update Keeps Fee Buyout

The state Legislature’s top policy analyst office is maintaining its original criticisms of Gov. Arnold Schwarzenegger’s state budget — revised by the governor last week — which still keeps millions in funding to buy out an increase of student fees at both the University of California and the California State University.

Under Schwarzenegger’s revised budget — similar to his original proposals for higher education — a windfall of state revenue will be used to provide $75 million to UC campuses in order to save students from a planned 8-percent fee increase.

Although college lobbyists have lauded Schwarzenegger’s plan as a financial reprieve for students, the state’s Legislative Analyst’s Office is still expressing worry over the proposal’s long-term effects.

“In the very short term, students would feel relief but it will set us up down the road for larger increases because of this year’s relief,” LAO Higher Education Director Steve Boilard said. “We might be rich now, but what happens later when the state economy is unhealthy? Fees should not be based on the health of the state economy.”

In November, the UC Board of Regents approved a $492 fee increase from this year, requiring students to pay a total of $6,633 in mandatory system fees. A provision within the proposal, however, allowed the regents to rescind the increase if the Legislature approved Schwarzenegger’s plan.

Since 2000, fee levels have almost doubled, with about a 10-percent hike each year. Such fee predictability — outlined in a 2004 compact between former Gov. Gray Davis and UC President Robert C. Dynes — would be destroyed by Schwarzenegger’s proposal, according to Boilard.

“The state continues to lack a policy for setting fees,” he said. “There’s absolutely no gradual predictability to fees, and no way to see what is down the road, especially with this latest budget.”

State Assembly Speaker and ex-officio Regent Fabian Nuñez has said Schwarzenegger’s buyout would benefit both students and the state.

“Putting money into the UC is like investment,” Nuñez spokesman Richard Stapler said. “The university is a huge economic generator for the state.”

Like his original proposal, the governor’s current plan gives no funding to UC labor centers and academic preparation programs.

A specific line item for both programs was not included because the university still needs to reassess the success of outreach, according to Schwarzenegger’s budget spokesman H.D. Palmer.

“This is an issue of setting priorities in the overall budget for the university system,” he said.

Although re-evaluation is needed, the LAO said that completely cutting funding to outreach programs might be too extreme.

“In my mind, it’s pretty clear that some of these outreach programs are more effective than others,” Boilard said. “But there are so many moving parts to these programs, and it seems to me reasonable that there can be many improvements to these programs. Unfortunately, it’s been an all or nothing approach when it comes to funding.”

Critics have panned the university for not establishing a direct link between academic success and outreach programs.

However, some politicians say that outreach is an essential tool for retention and recruitment of a diverse student body. State Sen. Jackie Speier (D-San Francisco/San Mateo), who sits on the Senate Education Committee, lauded outreach efforts such as the Preuss School, UCSD’s charter school that enrolls disadvantaged students.

“This is a school where disadvantaged high school students graduate at a rate of 90 percent and the majority of them go on to a UC school,” Speier said. “That’s a phenomenal story that should be heralded, not criticized.”

Schwarzenegger’s budget revision also reduced the university’s budget by $3.8 million because of augmented related enrollment levels.

Readers can contact Charles Nguyen at [email protected].