Governor releases budget plan
Chancellor urges campus to ‘proceed with caution and prudence’

16 January 2002 | Gov. Gray Davis released his state budget proposal Jan. 10 that, while containing targeted cuts for UC, has been met with relief by many in public higher education.

The proposal provides funding for an expected 7,100 new UC students, continued support for Berkeley’s Summer Sessions program, and merit increases for faculty and staff. UC’s state-funded budget would total $3.4 billion in 2002-03, roughly the same as the original budget for the 2001-02 fiscal year.

The plan would make mid-year reductions totaling $41 million in the 2001-02 UC budget and then provide a $50 million increase for the 2002-03 fiscal year above the revised 2001-02 level.

The budget proposal was crafted amid an economic downturn that has left the state with an estimated $12 billion state budget shortfall. In that context, it is “as favorable a budget for UC as we could expect,” Chancellor Berdahl said in a campus memo issued Jan. 14.

Based on current information, he said, “We plan to proceed with the normal campus budget planning process for the next year and will not be asking units for plans to implement budget reductions.”

Berdahl urged the campus, however, to “proceed with caution and prudence.” Current constraints on campus hiring, for example, will remain in place as the proposal wends its way through the budget process this spring. “We must reckon with a very tight budget for the coming year,” he said.

The chancellor called the plan’s figures on salaries a matter “of greatest concern for us.” The proposal calls for an average merit increase of 1.5 percent for eligible faculty and staff. UC had sought an additional 2 percent increase for faculty and staff and a further 2 percent increase for employees in positions where compensation levels lag the market.

Berkeley is also concerned, he said, about proposed reductions in resources for the Library and deferred maintenance.

The governor has proposed several mid-year cuts for 2001-02 that would be made permanent, including $25 million of the $75 million the state provided to UC this year to cover increased energy costs, as well as smaller cuts related to K-12 teacher training and outreach.

For the 2002-03 fiscal year that begins July 1, meanwhile, the governor proposed funding for enrollment growth of 7,100 full-time-equivalent students, a 4.3 percent increase over the budgeted amount for 2001-02.

The budget proposes that mandatory systemwide student fees stay level, which would make 2002-03 the eighth consecutive year without a systemwide fee increase at UC. However, unlike previous budgets, the plan does not provide state funding to cover the university’s loss of the additional fee revenue it needs to maintain support for existing programs.

The governor’s budget provides funds to cover a 6.7 percent increase in the university’s costs of providing health insurance to its employees; UC had estimated that a 10 percent increase would be necessary.

The plan expresses the governor’s support for education bond measures on the 2002, 2004 and 2006 ballots that would provide needed facilities funding for UC. It also would accelerate funding for the UC-based California Institutes for Science and Innovation. Berkeley is a partner in two of these initiatives, the bioengineering institute known as QB3 and the Center for Information Technology Research in the Interest of Society, CITRIS.

The governor’s budget proposal next will be considered by the legislature. Final action on the state budget generally occurs by early summer.

The state budget documents are available at www.dof.ca.gov. Information on the UC budget may be found at www.ucop.edu/news/budget/.