The May Revise

As noted in prior postings, yours truly is traveling so our analysis of the governor's May Revise budget was delayed. However, last Thursday, May 14th, the governor presented his revised budget proposal for the coming fiscal year, 2026-27. He will be termed out in January 2027 when the budget year is a little over 50% over, and his successor will have to deal with the rest of the year and come up with a budget plan for 2027-28.

The governor spent about an hour going over his proposal of which about 13 minutes was more devoted to his non-campaign for president in 2028. He then took about an hour for Q&A. 

Usually, in our past reviews of such proposals, we start with the macro and then go to the micro, i.e., UC. But let's do it in reverse this time. What about UC?

SIGNIFICANT BUDGET ADJUSTMENTS

• Base Funding Augmentation—The May Revision maintains the proposed increase of $254.3 million ongoing General Fund, representing a 5-percent base increase for the fifth and final year payment of the Compact. The May Revision also maintains the proposed increase of $96.3 million ongoing General Fund to provide partial funding of the fourth year Compact payment as scheduled in the 2025 Budget Act.

• Compact Funding Deferral—The May Revision maintains the planned one-time deferral of the 2025-26 Compact investment of $240.8 million, representing a 5-percent base increase in the fourth year of the Compact, to 2027-28. The May Revision also maintains the planned one-time 2025-26 deferral of $31 million to offset revenue reductions associated with the replacement of 902 nonresident undergraduate students enrolled at three campuses with an equivalent number of California resident undergraduate students, from 2025-26 to 2027-28.

• One-Time Base Deferral—The May Revision maintains the proposed delay of a one-time repayment of $129.7 million, representing a deferral of a one-time 3-percent base increase from 2025-26, from 2026-27 to 2027-28.

• Foster Youth Support Services—An increase of $1.5 million one-time General Fund to support First Star Academy Youth Cohorts at UC campuses.

Source: https://ebudget.ca.gov/2026-27/pdf/Revised/BudgetSummary/HigherEducation.pdf.

Translation: We have a multi-year "compact" with UC but we won't actually pay what is due. Instead, we will keep deferring part of what is due to the future when there will be some new governor and a new legislature and they might or might not honor it. Compact is not the same as contract. The latter is enforceable. The former isn't.

Of course, everyone understands this point. But the game is played by UC thanking the governor and then seeking more from the legislature. From UC President Milliken:

I’m deeply grateful to Gov. Newsom for his thoughtful leadership and sustained support of the University of California over the years. The UC funding included in the May revision will help ensure that the university remains affordable and accessible to California students. As the University of California faces ongoing federal funding uncertainty and increasing operational and labor costs, state funding for UC is more important than ever.  

We will continue to advocate for the resources necessary to help our hundreds of thousands of students succeed, and to support the faculty and staff who deliver the teaching, research, and patient care that Californians expect and deserve. I look forward to working with Gov. Newsom and the Legislature in the coming weeks to achieve a state budget that fully funds UC and improves the lives of every Californian.

Source: https://www.universityofcalifornia.edu/press-room/uc-statement-gov-newsoms-2026-27-revised-budget-proposal.

How effective will the UC advocacy be? The governor's May Revise for UC is about what the proposal was in January, with some tidbits added.* So the governor wasn't much affected. We will have to see what the legislature does in the next few weeks.

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*See https://ebudget.ca.gov/budget/m/2026-27/Department/6440.

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What about the macro?

Enough extra revenue (revenue above projections) came in thanks to AI and stock market gains to lead to a modest surplus for the current fiscal year.** Next year, however, total reserves fall rather than rise, i.e., a deficit. That isn't what the governor said during his presentation. But that is what his numbers say.

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**There are various reserve accounts associated with the General Fund (GF). Yours truly had to estimate the changes in the Public School and Safety Net accounts using figures for 2024-25 as enacted to calculate the change in those accounts to 2025-26. LAO, which has more access to data, reports a slight deficit for the current year rather than a small surplus:

https://ebudget.ca.gov/reference/MultiYearProjection.pdf. 

LAO also reports projected deficits out to 2029-30:

https://lao.ca.gov/Publications/Report/5187.

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NOTE: The governor's May Revise news conference can be seen at:

https://ia601802.us.archive.org/14/items/newsom-may-june-2026/newsom%205-14-2026%20May%20revise.mp4.

Straws in the Wind - Part 348

From the Daily Princetonian: All in-person examinations at Princeton will be proctored starting July 1, representing the most significant change to the honor system since it was established in 1893. The faculty passed a proposal requiring instructor supervision... with one opposing vote. The historic vote was the culmination of months of deliberation within the administration and student governing bodies about how to address increasing concerns over academic integrity violations, including the proliferation of AI usage. The proposal cleared a full faculty vote as the final of three required rounds of approval, having already been passed unanimously by the Committee on Examinations and Standing and the Faculty Advisory Committee on Policy.

According to the policy proposal, previously sent by Dean of the College Michael Gordin to the Faculty Advisory Committee and included in Monday’s meeting notes, instructors will remain present in exam rooms “as a witness to what happens,” but are instructed not to interfere with students. If a suspected Honor Code violation occurs, proctors will document their observations and submit a report to the student-run Honor Committee, where they may later testify under the same standards used for other witnesses... 

The proposa... points to a growing reluctance among students to report peers directly. The proposal claims that anonymous reporting of allegations has increased in recent years, fueled by fears of “doxxing or shaming among their peer groups” online... 

Full story at https://www.dailyprincetonian.com/article/2026/05/princeton-news-adpol-proctoring-in-person-examinations-passed-faculty-133-years-precedent.

Will Harvard Continue to Lead the Charge? - Part 162

From The Free Press: In June 2019, the writer Ta-Nehisi Coates appeared before a congressional committee to make the case for reparations. Advancing an argument he’d laid out in The Atlantic years earlier, Coates contended that America owed a debt to its black citizens not just for slavery but for generations of plundered wealth. Over the next few years, the issue had grown in visibility, and slogans like “Black Lives Matter” had entered mainstream political discourse. “It is impossible to imagine America without the inheritance of slavery,” Coates told the committee. Six months later, Harvard University took up the cause when Harvard president Lawrence Bacow convened a faculty committee to excavate the university’s historical involvement in the Atlantic slave trade.

...The university then established what it called the “Harvard & the Legacy of Slavery Initiative,” which aimed to “remedy harms to descendants, to our community and the nation, and to campus life and learning.” It committed an extraordinary $100 million to the initiative and promoted Sara Bleich, a professor of public health policy, to vice provost for special projects to shepherd the effort.

...One of the Legacy of Slavery Initiative’s first hires was a man named Richard J. Cellini. His job was to find those descendants. At that point, Harvard had identified 79 individuals who had been enslaved by university affiliates, but it had yet to locate a single living relative. “I don’t think Harvard really understood what they were getting themselves into,” Cellini told me. Cellini, 62, is not the sort of person you might expect to do this kind of work. He describes himself as an “Eisenhower Republican” rather than a “social justice warrior.” Genealogy, which is now his avocation, came to him late in life. He began his career as a lawyer on Wall Street, and then spent three decades “growing and selling” technology companies.

...Harvard soon discovered that Cellini was a forceful advocate for his work, determined to find as many descendants as he could, no matter the consequences. Meanwhile, Harvard was clearly getting nervous about the potential scope of his efforts. ...[Harvard's] anxiety was not entirely irrational. Every name Cellini added to the ledger represented a potential claim on Harvard’s commitment. Cellini pushed to enlarge the list of potential beneficiaries by including the names of slaves owned by members of the university’s governing boards—a category administrators had debated. He won that debate—and the pool grew accordingly. A research trip to Antigua, following the discovery of several hundred individuals enslaved there by Harvard affiliates between the 17th and 19th centuries, yielded an additional hundred names from public archives. Cellini and his team also met with Antigua’s prime minister and discussed opportunities for collaboration between the university and the island nation, a conversation that likely did little to reassure Harvard administrators about the project’s scope.

...Shortly after Cellini and his team returned from Antigua in January 2025, they were all fired by Harvard. The university subsequently outsourced the work to American Ancestors, a New England genealogical nonprofit now on a three-year contract. Harvard has declined to provide a specific rationale for the change. American Ancestors has denied that the university has imposed any constraints on their research...

...Harvard, like any institution invested in its own survival, is not about to bankrupt itself. Its effort will likely follow the well-worn path of local reparations programs across the country: introduced with a bang and then quietly abandoned as the logistics and finances prove untenable...

Full story at https://www.thefp.com/p/harvard-reparations-plan-failure.

The One That Didn't Get Away (but is behind closed doors, too)

Unlike our previous post about last week's Regents meeting about the conflict with the feds, we caught this one just in time, since the meeting is later today. But like all the other ones, it is behind closed doors, so we don't know if there are really any new developments.

TO THE REGENTS OF THE UNIVERSITY OF CALIFORNIA: 

Because the membership of the Advisory Group on Research and Programs Funding Legal Issues (“Advisory Group”) includes five members of the Regents’ Governance Committee, there exists the potential for having present a quorum of a Regents’ Committee when the advisory committee meets. 

This notice of meeting is served in order to comply fully with pertinent open meeting laws. On Tuesday, May 19, 2026, there will be a Closed Session, Special Meeting of the Regents’ Governance Committee concurrent with the Advisory Group to discuss Research and Programs Funding Legal Issues 

(Closed Session Statute Citation: Litigation [Education Code section 92032(b)(5)].) 

The meeting will convene at 4:00 p.m. at 1111 Franklin Street, Oakland and adjourn at approximately 5:00 p.m. 

(Advisory Group members: Regents Anguiano, Cohen, Hernandez, Matosantos, Milliken, Reilly, Robinson, Sarris, and Sures)

Source: https://regents.universityofcalifornia.edu/regmeet/may26/meeting-notice_federal-may-19-2026.pdf.

The one that got away

The announcement of the (closed-door) Regents meeting above somehow got away from us. So, for the record, here it is. As blog readers will know, at the regular May 5-6 meetings at the Regents, there was also discussion (behind closed doors) of the conflict with the feds. Did some new development occur between those meetings and the May 9th announcement above?

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The link (for the record) to the announcement is:

https://regents.universityofcalifornia.edu/regmeet/may26/meeting-notice_federal-may-12-2026.pdf.

I Never Promised You a Rose Bowl? - Part 17

As blog readers will know, after former UCLA CFO Agostini was fired for saying Very Bad Words, it was said that the idea of moving UCLA from the Rose Bowl to the newer SOFI stadium was his baby. Blog readers will also know that that threat of such a move has sparked litigation against UCLA. A reported $30 million is being spent to snazz up the Bowl based in part on UCLA's long-term lease.

In case you missed it, the LA Times recently carried a report that suggested maybe UCLA is reconsidering its proposed departure from the Rose Bowl:

Last October, in the wake of UCLA’s threats to terminate its contract with the stadium, the Rose Bowl Operating Co. and the City of Pasadena filed a lawsuit to force the Bruins to honor the remaining two decades of their deal and keep their home football games at the historic venue through 2044. UCLA is staying put for next season and there are indications the sides could be quietly heading toward a settlement that would keep the Bruins in place for the foreseeable future, ending their flirtation with SoFi Stadium.

Speaking to the media at UCLA’s recent spring game, coach Bob Chesney heaped praise on the Rose Bowl, saying, “To get a chance to walk in here and just feel this ... is pretty special, we addressed that last night as a team and made sure we understand the respect that this place deserves and understand the attitude of gratitude we should have.” ...

Full story at https://www.latimes.com/sports/ucla/story/2026-05-11/inside-rose-bowl-30-million-renovation-ucla-football.

Straws in the Wind - Part 347

From the Boston Globe: When Gaurav Jashnani was offered a position as an assistant professor at Hampshire College, he saw it as a good move: Even though the iconoclastic liberal arts school doesn’t have a tenure system, the job would put him on a forward-moving track at a forward-looking institution. So in 2024, he relocated his family from Belmont to Northampton, where he became a first-time homeowner. Now, less than a month after Hampshire announced it would close, he’s staring down unemployment. Like most of the school’s roughly 250 employees, he will have no paycheck, no severance, and few job prospects after June, since the hiring cycle for the coming academic year has already closed.

“It’s been kind of a train wreck,” said Jashnani, who teaches psychology, Black studies, and disability studies. For some faculty members, “we just don’t know how we’re going to pay our bills.” Like students, many Hampshire faculty and staff thought the college was on the upswing after nearly closing in 2019. The school, however, was not able to recruit enough students to stabilize its finances, and it failed to secure much-needed debt refinancing and a crucial land sale in recent months. Administrators nevertheless remained optimistic, inviting alumni to brainstorm on Zoom about Hampshire’s “next three to five years” as recently as March 25. Less than three weeks later, on April 14, Hampshire announced it would close.

Now some faculty wonder how Hampshire went from projecting confidence to pulling the plug so quickly — with nothing left to offer its employees...

Full story at http://bostonglobe.com/2026/05/07/metro/hampshire-college-employees-closure/.