[an error occurred while processing this directive]

Additional campus, UC budget cuts pending

Student Cal Grants saved for now

| 11 June 2009

UC, campus leaders take pay cut

The annual salaries of the UC president, chancellors, provosts, and other high-ranking university officials will be reduced by 5 percent next month, in response to the deepening budget reductions proposed for UC as a result of California's fiscal crisis.

UC President Mark Yudof announced the pay cut to those affected in a letter sent at the end of May. The action affects some 30 senior administrators, also including executive and senior vice presidents, executive vice chancellors, and the system's general counsel.

"Admittedly, this action does not have a significant impact on our very serious budget deficit, given its magnitude and the fact that UC's senior management group comprises only a very small fraction of university employees," Yudof noted in his letter. "Given the magnitude of the budget shortfall, all options need to be considered, and unfortunately, it is likely that every member of the UC community will be affected negatively."

The campus budget picture darkened further in the past month with the defeat of five state ballot initiatives and the relentless downward spiral of California's finances.

Berkeley's anticipated shortfall, which stood at $94 million at the time of the May 19 special election, ballooned to $145 million as a result of additional cuts proposed by Gov. Schwarzenegger to deal with the gaping hole in the state budget. That hole was widened by the failure of the suite of propositions that were designed to ease the state's fiscal crisis.

Budget CentralGet more budget news at Budget Central
What that means for the campus is still being determined, but Chancellor Birgeneau is expected to outline the situation soon in a letter to faculty and staff.

The percentage of budget cuts that each campus unit will be required to take for the 2009-10 year will be announced by the chancellor and provost later in June, in time for the start of the new budget year on July 1. Units had been told in early spring to plan for 8 percent cuts, on average, but that target could more than double because of the new cuts in the governor's revised budget.

Already at Berkeley, layoffs, a staff hiring freeze, voluntary-retirement and reduced-work-time programs, a slowdown in faculty hiring, and other efforts have been under way, all aimed at meeting the budget challenges.

One welcome reprieve emerged in the past week from legislative budget negotiations in Sacramento: The proposed elimination of the Cal Grants financial-aid program is off the table, at least for now. Voting on Friday, the Conference Committee on the Budget rejected Schwarzenegger's proposal to eliminate Cal Grants for thousands of students entering college this fall.

However, the governor's initial proposal outlined a four-year phase-out for Cal Grants, so the program remains vulnerable to cuts and possible elimination in the future. UC is actively advocating to preserve the funding. Cal Grants represent 35 percent of all grant resources for UC students. The loss of the program would affect every UC Berkeley student receiving grant or scholarship aid on campus roughly 50 percent of Berkeley undergraduates since all financial-aid packages would need to be reallocated if the program went unfunded.

Testifying before the legislative committee last week, UC President Mark Yudof told lawmakers that phasing out Cal Grants would be devastating to low- and middle-income students attending the university as well as the state universities and community colleges 118,000 undergraduates in all.

Yudof's testimony offered a preview of what may lie ahead for UC if the governor's currently proposed cuts for UC take effect.

"These include the possibility of further reducing first-time freshman admissions for 2010-11, revisiting the fee-increase levels for 2009-10, and implementing furloughs, more layoffs, and salary reductions for our employees," Yudof said in prepared remarks for the legislators.

He deplored a plan to eliminate $31.2 million in state funding for UC's academic-preparation programs, which help educationally disadvantaged students prepare for college.

Yudof also argued that state cuts to UC should be unallocated, allowing the university to decide where and how to make cuts.