The bottom line for
UC in the May Revise – as far as one can tell from the official document and
the governor’s news conference earlier today – is that there is no significant
change since the January proposal (which is less than the Regents are
requesting). Although the governor spent
some time discussing his plans for CalSTRS (teacher pensions), there was no
sign of any change in approach with regard to the UC pension. Thus, the Regents’ point that the state funds
CSU pensions via CalPERS but seems to disown the UC pension remains unanswered. [Page 67 of the May Revise document - see link below - lists various state pension payments but explicitly excludes UC in a footnote.]
The May Revise
includes the governor’s “rainy day” fund plan (which requires voter approval in
November once the legislature puts it on the ballot). That plan complicates budget accounting
methodology since the payments into the fund are treated as an expenditure. I have reworked the figures somewhat in the
table below (scroll all the way down to the bottom of this posting). Note that when we aggregate the rainy day
fund and the “regular” reserve in the General Fund, the combined reserve falls
during 2014-15. A fall in the combined
reserve suggests a deficit – which is not the general public impression in this
election year.
There is some
prepayment of Schwarzenegger’s Economic Recovery Bonds which, if subtracted
from “revenue and transfers” would turn the modest deficit into a modest
surplus. You can argue about how it
should be treated since once you prepay, you can’t get it back. In any event, there is the discrepancy
between the state controller’s cash statements (which show a negative reserve
starting the current 2013-14 fiscal year) and the governor’s accrual number
(which shows a positive figure). In an
earlier post on this blog, we noted that the General Fund through April 2014
(the big tax receipt month), had a negative reserve of $10 billion which means
that a lot of revenue relative to spending would have to come in during May and
June 2014 to produce a positive number at the end of June.
At the news
conference, when asked about court funding, the governor lumped both court
funding and university funding together and gave his usual sermon about doing more
with less, coming up with innovations such as online courses, etc. Below in italics
is the relevant text from the May Revise on higher ed. You can find the May Revise document at http://www.dof.ca.gov/documents/2014-15_May_Revision.pdf
Multi‑Year Stable Funding Plan: University
of California and California State University
As
proposed in the Governor’s Budget, the May Revision continues the commitment to
a multi‑year stable funding plan for higher education. The plan prioritizes higher education by
providing new funds to continue reinvesting in the public universities, with the
expectation that the universities will improve the quality, performance, and cost
effectiveness of the educational systems. The plan is rooted in the belief that
higher education should be affordable and student success can be improved
without dramatic increases in costs to the state or to students.
Funding
Stability
—
The plan
provides each segment up to a 20 percent increase in General Fund
appropriations over a four‑year period (2013‑14 through 2016‑17), representing
about a 10 percent increase in total operating funds (including tuition and fee
revenues).
Affordability
—
The plan
assumes a freeze on UC and CSU resident tuition from 2013‑14 through 2016‑17 to
avoid contributing to higher student debt and tuition levels.
Student
Success
—
The plan
expects UC and CSU to decrease the time it takes students to complete a degree,
increase the number of students who complete programs, and improve the rate of
transfer of community college students to four‑year colleges and universities.
Innovation
—
In addition
to efforts by the UC, CSU, and CCC to meet student success goals, the Governor’s
Budget includes $50 million to promote innovative models of higher education at
the campus level that result in more bachelor’s degrees, improved four‑year
completion rates, and more effective transfers between the community colleges
and the universities.
The multi‑year
plan directs the universities to prepare three‑year sustainability plans that set
targets for key measures adopted in statute in 2013
May Revise $billions 2013-14 2014-15
- - - - - - - - - - - - - - - - - - - - - - -
- - - -
Reserve at start of
year $2.4
$3.9
Revenue &
transfers* 102.2 105.3
Expenditures 100.7 106.2
Surplus/deficit +1.5 -0.8
Reserve at end of
year 3.9 3.1**
- - - - - - - - - - - - - - - - - - - - - - -
- - - -
*Transfers include -$1.6
billion in prepayment of Economic Recovery Bonds each year.
**$1.5 billion in
regular reserve; $1.6 billion in rainy day fund.
No comments:
Post a Comment