LOOKING INTO THE UC BUDGET -- Report #8a (e-mail version)
by Charles Schwartz, Department of Physics, University of California
Berkeley, CA 94720. 510-642-4427 February 28, 1994
INITIATIVE & RESPONSE
In my Report #8, dated December 20, 1993, concerned with the
impacts of increasing student fees, I looked into a question that
had previously been obscured: What is the per-student cost of
undergraduate instruction at UC? The UC President's Office has used
the figure $12,168 as the full cost of instruction in 1991-92,
averaging all General Campus instruction over all students. In my
analysis, I separated the undergraduate portion from the graduate
portion and found a current cost of $5,040 per-student per-year for
undergraduate education (covering "tuition plus fees"), noting that
this figure was less than one-half of the amount claimed by the UC
administration. This raised a fundamental challenge to the
University's current plans and financial policies, affecting not
only the level of undergraduate student fees but also the future
support of faculty research and graduate education.
The President's Office has responded to that challenge with the
following letter.
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February 16, 1994
Dear Professor Schwartz:
I write concerning your "Report #8" ...
With respect to the cost of instruction, there are a number of
different approaches one could take. We spent over a year developing
the methodology which established the cost of instruction at $12,168
in 1991-92, and that methodology was reviewed and concurred in by
the California Postsecondary Education Commission, the Department of
Finance, and the Legislative Analyst's Office. Thus, $12,168
reflects a consensus among interested and knowledgeable parties,
even though other methodologies are certainly possible. As we have
clearly stated, the figure represents an estimate of the average
cost of education for undergraduates and graduates combined across
all disciplines. There is no factual basis for your statement that
the real cost per undergraduate is "less than half the amount
claimed by UC." We have made no claim regarding the separate cost
of either undergraduate or graduate education.
You calculate the cost of education for undergraduates at $5,040.
Using your methodology, the cost for graduate students would be
$15,770--although you do not provide this figure. The issue of
charging higher fees to graduate academic students (i.e., not
including students in selected professional schools) has been a
topic of discussion at several Student Fee Advisory Committee
meetings within the University since 1992 as well as at a
Universitywide forum on fees and financial aid held August 6, 1993,
and at meetings with the California Postsecondary Education
Commission prior to the adoption of the Commission's staff reports
on development of a statewide long-term student fee policy. CPEC
recommended against higher fees for graduate students. In our own
examination of fees charged at comparable universities, it has
become clear that in order for UC to remain competitive and
continue to attract top graduate students, most of the revenue from
higher fees would need to be used for financial aid. In the end,
there would be very little financial gain if we were to charge
higher fees to graduate academic students.
In any event, as you know, The Regents have adopted a fee policy
which includes the cost of education as only one of a set of factors
that will be considered when fee levels are adjusted. Other factors
include the level of support for the University provided by the
State and fees charged at comparable institutions.
Sincerely,
Larry Hershman
Associate Vice President and Director of the Budget
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WHAT'S IN THE LETTER
There is only one point in Hershman's letter where he disputes
something I said in my Report #8:
"There is no factual basis for your statement that the real cost
per undergraduate is 'less than half the amount claimed by UC.'
We have made no claim regarding the separate cost of either
undergraduate or graduate education."
While Hershman's legalistic definition, "We have made no claim ...,"
refutes my statement as far as he is concerned, here are some
writings from other top UC offices and officials that contradict him:
**from UC Focus, Published for the faculty and staff of the
University of California by the Office of the President, February/
March 1994, lead story, reporting on the Regents January 21 meeting:
"Under UC's budget plan, undergraduate student fees would
increase by $620 or 17 percent next fall. With that increase, a
resident undergraduate student would pay an average $4,347 in
1994-95 or about a third of the cost of their education. The
state still would subsidize more than 60 percent of the estimated
$12,800 average annual cost of an undergraduate student to
attend UC."
**from the formal student fee policy document presented by the
Office of the President to the Board of Regents and approved by them
in January (Item #1 and Item #5, page 2):
"With 1994-95 Educational and University Registration Fees
proposed at $4,074 for undergraduate resident students, students
would be paying slightly less than a third of the cost of their
education."
**from an Op/Ed piece by Regent William T. Bagley, in the San
Francisco Chronicle, 1/26/94:
"Simple arithmetic tells us that undergraduate education at UC
costs about $13,000 per year per student. Undergraduates now
pay about 30 percent of that total."
I think the contradiction seen here can not be explained as a
careless error being made by each of these authoritative writers -
linking the $13,000 figure with the educational cost of
undergraduate students. It seems more likely that this is a
deliberate attempt to obscure the facts and mislead the public.
Hershman's middle paragraph, arguing against the idea of
charging higher fees to graduate academic students, is rather
strange, since I propose no such thing. In my Report #8 I said,
"The financial arrangements that UC makes for its graduate
students in PhD programs, preparing them for careers in research,
college teaching, etc., are completely unlike those for the
undergraduates. Teaching Assistantships, Research Assistantships,
tuition wavers, fee remissions, and various fellowships are
provided to recruit the best talent from across the nation and
around the world and to provide, wherever possible, complete
financial support for these budding scientists and scholars."
This was part of my argument for separating undergraduate and
graduate instruction as two very different enterprises. It thus
seems that Hershman is supporting my point of view, although he does
not acknowledge that.
Hershman spends some time bolstering the case for his
methodology (not just a different calculational method, but
answering a different question) by referring to several government
bodies that have agreed with him in calculating the combined cost
of instruction, undergraduate plus graduate. I can understand that
the higher figure he obtains that way serves the particular interest
of Sacramento, as well as the particular interest of UC's management.
But that weight of authority does not necessarily make it right. In
particular, one motive for my study was the recognition of the
different interests of a new party which the University will have to
deal with - the students and their families who are being made to
foot the bills that the State will no longer pay.
WHAT'S NOT IN THE LETTER
In Report #8 I laid out in detail the concepts, the process and
the numbers that went into calculating the cost of undergraduate
instruction. Hershman quotes my result ($5040 per undergraduate
student) and voices no criticism of my method or of the details of
my calculation. I take this as a positive endorsement of my work.
There are a number of details one could argue about, some pushing
the number down and others pushing it up; but for now I will stay
with this earlier result.
The most profound silences in Hershman's letter concern the
fundamental assertions and analyses of my Report #8, things that
came before and after the exercise with numbers.
I expounded, "the idea that UC must be fair in charging
students and their families for no more than what they get," and
Hershman says nothing about this. Fairness is a bedrock principle
of our society, of our laws, and, I hope, of our University. Yet,
the plans that the UC President has presented, and that the Regents
have approved, involve something that appears quite unfair. Within
two years the level of fees charged to undergraduate students at UC
will exceed 100% of the cost of undergraduate instruction. That is,
it appears that part of the UC Administration's plan is to make
undergraduate students and their families subsidize other remote
parts of the University's operations - principally faculty research
and the graduate academic (PhD) programs with which that research is
intimately connected.
It is of the utmost importance that this topic be fully and
openly debated by the Regents. Will undergraduate student fees be
allowed to rise above the ceiling defined by the full cost of
undergraduate education? To avoid this question, as Hershman has
chosen to do in writing his letter, does not make the problem go
away; delay and obfuscation will only make the eventual reckoning
more painful for the whole University.
THE QUESTION OF QUALITY
The word "quality" is usually the first one used by UC
officials to define their priorities in these hard financial times.
Quality usually refers to the research reputation of the faculty,
especially in comparison to other top universities. Quality is also
used in connection with the university's instructional program and
again comparisons are drawn with other select universities. Hershman
mentions that the level of UC student fees will be sensitive to
"fees charged at comparable institutions."
The most often used measure of educational quality is the
Student/Faculty Ratio. The Office of the President says UC's ratio
is 18.6, while its four public comparison schools average 17.8 and
its four private comparison schools average 10.4. Here, again, I
say one should separate undergraduate students from graduate
students in calculating Student/Faculty Ratios. Using data provided
by UCOP and CPEC I have calculated the following:
Table 1. Ratio of Undergraduate Students to Faculty
University of California 15.1
Average of 4 Public Comparison Universities 12.9
Average of 4 Private Comparison Universities 5.0
The huge difference between the top and the bottom numbers in
this Table has its historical roots in the mission of the public
universities to educate large numbers of undergraduates, while the
elite private research universities (Harvard, MIT, Stanford, Yale)
have kept their undergraduate classes small. By this measure an
undergraduate education at the elite private universities is far
richer, and thus the far higher tuitions they charge may be
justified. Conversely, UC (and the other public universities)
cannot justify anything close to those sky-high fees; and UC even
looks somewhat worse than the comparison public universities.
(Looking at graduate students only, the ratio is rather close among
all these schools; and this reflects the real basis for the
selection of comparison institutions.)
This new data casts further doubt upon the moral legitimacy,
and even upon the marketability, of higher undergraduate fees at UC.