Using a conservative approach to budgeting for 2010-11, UCLA leaders are asking the heads of all academic and administrative units to stay the difficult course set this fiscal year when UC experienced an unprecedented drop in state support.
But for now, campus leaders said they do not foresee a need for a new round of cuts beyond the 5 percent general fund reduction allocated to campus units in 2009-10, which saved the campus $33 million.
In planning for next year’s budget, campus leaders believe that UCLA will face a permanent loss of $117 million in state funding for 2010-11, the same as in 2009-10, but with one difference. The $55 million cut that was made on a one-time basis in 2009-10 will become permanent.
In addition, the campus will face new costs for retirement contributions and faculty merits, totaling $25 million. Campus executives will also need to continue making targeted reductions to specific programs, but these will be reduced from the $62 million in cuts made this year to at least $12 million in cuts for 2010-11.
“I don’t think we’re going to be returning to the levels that gave us robust state support,” Chancellor Gene Block told members of the Legislative Assembly of the Academic Senate, which met Thursday, Feb. 11, in the Charles E. Young Grand Salon. “It’s going to level off, and that’s the new reality. That means that this institution has to operate differently. It can’t operate as it has in the past.”
The campus will need to continue to intensify its efforts at careful restructuring of academic and administrative programs, Block said.
And although Gov. Arnold Schwarzenegger seeks to restore the one-time $305 million reduction made to UC’s budget this fiscal year — $55 million of which was cut from UCLA’s budget — campus leaders said they are assuming that the State Legislature is going to reject his proposal.
“We’re not planning on it,” the chancellor said. “We have to do our budget-planning with a very conservative view that what we have now is what we’re going to have next year.”
The governor’s proposal — a constitutional amendment to make higher education a funding priority over prisons — will have no impact on 2010-11, whatever its political fate, campus leaders said.
Joining Block at the Academic Senate meeting was Steve Olsen, UCLA vice chancellor of finance, budget and capital programs. Olsen presented several assumptions, based on the best information that is currently available, on which UCLA’s 2010-11 budget is being planned:
• Campus leaders are not counting on the governor’s budget proposal to restore about $51.3 million in partial funding for student enrollment. The governor’s proposal was made contingent on a hefty increase in the amount of federal relief California will receive. “Most budget experts give that proposal very little chance of getting through,” said Olsen.
* UCLA is planning to make few changes in overall student enrollment for next year, but there will be a slight shift from 150 fewer resident freshmen to 150 more new non-resident freshmen and transfers. Resident transfer students will increase by 75.
* There will be no new state funds for salary increases or for contributions to the UC Retirement Program, and nothing more to help UCLA cover cost increases for employee benefits and utilities. Beginning April 15 this year and continuing through 2010-11, campus and employee contributions to the retirement program will restart. UCLA departments will contribute 4 percent of employees’ salary costs, amounting to about $17 million. Employees will contribute 2 percent (redirected from the Defined Contribution Plan).
• There will be money for a faculty merit program for those who are eligible to participate. This program, supported by central funding, has been available for the past several years.
• The furlough program is set to expire August 31, 2010, for most employees. UC President Mark G. Yudof “has indicated he will not be recommending that the program be extended,” Olsen said.
• There is no plan for a broad-based cost-of-living adjustment, except in a limited number of instances as required by existing collective bargaining agreements.
• There will be no state funds for a UC capital building program.
The governor’s proposed budget also includes full funding for Cal Grants, which would cover, for eligible students, the large increases in student fees passed by the UC regents last year. All in all, UCLA will receive $96 million, after funds for financial aid are taken out, in new student fee revenue as a result of the 45 percent hike in student fees approved by the regents since the start of this academic year. “At this point, no further increases in student fees are planned,” Olsen said.
Campus leaders emphasized that they will start budget-planning with deans and vice chancellors in March and April, with input from faculty executive committees. In mid-May, the next milestone occurs in the budget process: the governor’s May Revision of his budget plan based on state revenue projections.
In the meantime, campus leaders will continue to update students, faculty and staff on the evolving budget situation. Last year, Chancellor Block, Executive Vice Chancellor and Provost Scott Waugh and Vice Chancellor Olsen participated in 45-to-50 separate campus events to talk about the budget, from meetings with a few dozen people to a presentation to some 5,000 staff at Pauley Pavilion, with an additional 1,200 watching online.
“I remain optimistic for this institution in the long run,” Block said. “With restructuring, and with some alteration of revenue sources, we are going to survive this, and we will thrive.”
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