No change in basic UC appropriation from January, but some one-time additions

Governor, wife, dog

The May Revise was presented at a news conference this morning which was more informal than past ones. It started with a presentation by the governor's wife of their new dog. As far as UC is concerned, it appears that there is no increase in the basic general fund allocation proposed for 2018-19, but some added one-time allocations. (None for the retirement system.) The $50 million contingent on complying with the state audit for this year (2017-18) appears likely to be paid, assuming certain actions by the Regents at their upcoming meeting. For next year, there is $100 million in "deferred" maintenance and $55 million for a program of graduate health education in underserved areas plus some smaller, earmarked amounts. (See pages 28-29 of the document at the link provided below.) The recent AFSCME strike was raised by a reporter and the response from the budget director, Michael Cohen, was that UC should manage within the dollars allocated. (Various jokes were made about California's Michael Cohen vs. Trump's Michael Cohen.)

California's Michael Cohen

The governor, in response to a question about desires by some in the legislature to give more to UC than the basic 3% increase was that he was "open to realistic proposals." For both UC and CSU there is language that if tuition is raised, the state would subtract the added cost to the state (from programs such as CalGrants) from the basic budget. (Note that this is less of a subtraction than a dollar-for-dollar deduction, since some tuition comes from other than the state, e.g., federal programs, direct payments from students, etc.). However, the budget director indicated that he thought there was likely to be no tuition increase next year.

Below is a summary of the budget proposal. Note that at the end of the day, although total reserves rise, they fall relative to expenditures. So how "open" the governor might be "to realistic proposals" regarding UC is likely subject to significant limitations. But there could be some room around the edges.

                 2017-           2018-   

$Millions        2018            2019

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Starting

GF Balance      $5,673          $8,452

Revenue &

Transfers     $129,825        $133,513

Expenditures  $127,046        $137,562

Surplus or

Deficit        +$2,779         -$4,049

Ending GF      

Balance         $8,452          $4,403      

Ending

Rainy Day

Fund            $9,410         $13,767

Total

Ending

Reserves       $17,862         $18,170

Ending

Reserves/

Expenditures     14.1%           13.2%

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The budget document released is at:
http://www.ebudget.ca.gov/FullBudgetSummary.pdf