Similar results can be seen in other projections for the state. California is simply not expected to grow in
the future at rates comparable to its “Golden Age” in which the Master Plan was
embedded. The symptoms are all
around. For example, state politicos
were surprised to learn after the 2010 Census that California was getting no
increase in its congressional seats because its population had not grown
sufficiently. Even the state’s
Department of Finance was surprised; it had estimated California’s population
to be roughly a million more than the 2010 Census revealed.
Expansion of capital projects and programs at UC as they
occurred in the earlier Master Plan golden era is not realistic but there is
inevitable momentum to push ahead regardless of the change. The Regents, as trustees of UC, need to go
beyond a building-by-building, program-by-program, approval process on a
part-time, two-month interval basis. And
they need to look after, not just before, projects are OK’d. What actually happens when the projects are completed?
It was interesting to
hear the approval process for the UC-Irvine project that preceded approval of
the UCLA hotel. (Audio available on a posting yesterday.) In that project,
questions were raised as to the cost per incremental square foot of an
expansion of an existing building and were answered by obfuscation. Yet what could be simpler than dividing the
cost by the incremental square feet? Nonetheless, despite the obfuscation, the project was approved.
After the UCLA hotel was approved, the third
item on the agenda was the outlook for state support for future capital
projects. Not surprisingly, the outlook
for state support was reported to be not good.
So UC is on its own for capital projects and if the projects turn out to
be white elephants in the future, too bad.
Someone will pay the cost then and it will probably not be on the watch
of those who promoted the initial plans. Or, even if it is on their watch, it
will be said that some unforeseen circumstances changed and – after all – the Regents
approved the project! (Those at UCLA
with long enough memories will recall the sad fate of the Westchester faculty housing
project.)
It is inevitable that campus-level bureaucratic momentum will
keep producing new projects and expansions.
Jobs and empires depend on such growth.
It is inevitable that every campus will want to include a full array of
every professional program. Absent an
independent capacity for Regental evaluation before and after the fact, the current micro-level,
case-by-case approach will not allow the Regents to exercise due diligence at a
systemwide macro-level.
As for the hotel specifically, since the Regents created no
auditing capacity to look at its results once
it goes into operation, it will surely show a profit on paper regardless of
its actual outcome. Because the hotel is
blended into a larger system, manipulation of costs charged to its operation
and diversion of conferences and other activities from other existing
facilities on campus can always create an ostensible surplus for the hotel with
losses shifted elsewhere. The Regents
have no capacity for monitoring such cost shifting after the fact and did not
chose to set such a mechanism up, whether for the hotel or for any other
case-by-case project approval or proposed expansion that comes before them.
In a preemptive move, UCLA got the Luskins to sign a letter
saying no alternative to the current hotel plan was acceptable, thus effectively
closing off any options, as the chair of the Regents’ Grounds and Buildings
committee pointed out. But even if the subsequent campus
politics of the hotel made its approval inevitable, the Regents could have used
the occasion to create a true mechanism for due diligence after the fact.
The Moral: Even a
white elephant can be made to fly, absent ongoing and after-the-fact oversight:
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