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UC Berkeley 2011.JPGIn a new report issued today, California's top fiscal analyst questioned Gov. Jerry Brown's desire to pour more money into state university systems without demanding a bigger detour from their "high-cost" model.

The nonpartisan Legislative Analyst's Office believes Brown correctly identified inefficiencies in the state's higher education systems. But it disagrees with the governor's approach and recommends that lawmakers reject several of his higher education proposals, particularly his ongoing funding increases for University of California and California State University.

"Why the state would invest more in a system that is high cost and has poor outcomes without requiring explicit improvement is unclear," the report states.

The university systems have seen dramatic state budget cuts since 2007-08, and their officials say they have responded with various program reductions in addition to tuition hikes. Brown's 2013-14 budget would increase general fund spending for UC and CSU to $2.8 billion each, still below the peak six years earlier but more than 10 percent above what they received two years ago.

The analyst's office seems to reserve its harshest cost complaints for the UC system, which it says spends 20 percent more per student than its national counterparts. The report cites three factors that could be to blame: low workload expectations for faculty, greater focus on expensive science programs than peers, and high compensation.

UC spends $166,000 for each degree it awards, according to the report.

LAO higher education analyst Judith Heiman said some schools elsewhere have begun devoting more faculty time to teaching in an effort to reduce costs. She said UC would not have to require that all faculty reduce their research time; it could, for instance, dedicate more professors to teaching while allowing others to continue their current split between teaching and research.

"When we pay for an undergraduate student to attend UC," Heiman said, "we're paying for another unit of research as well."

UC spokesman Steve Montiel said the system is reviewing the LAO report and had no immediate comment.

While students, parents and lawmakers have blasted universities for tuition hikes in the wake of state budget cuts, the LAO suggests that most families actually avoided dramatic increases because of generous financial aid.

Between 2008-09 and 2010-11, 86 percent of UC undergraduates whose families made less than $110,000 saw a two-year tuition increase of 4 percent or less. During that same period, 77 percent of CSU undergraduates whose families earned less than $75,000 also saw a two-year rate increase of no more than 4 percent.

But upper middle class and wealthy families saw more dramatic tuition hikes during that stretch. UC families earning more than $110,000 paid 13 percent more, while CSU families earning more than $75,000 paid between 15 percent and 17 percent more.

Still, the analyst's office finds that even after tuition hikes, the share of university costs paid by students is about 30 percent, while the share paid by community college students is about 6 percent. "These shares are very low compared with other states," the report says.

The analyst's office recommends that lawmakers reject Brown's proposed tuition freeze for four years -- a freeze that state taxpayers would fund. The LAO says that would help current students but would put future students at risk of greater tuition volatility. It also says that having the state shoulder cost increases would give families less incentive to hold the universities accountable for containing costs.

The LAO instead recommends that the Legislature create a formula that ties tuition and fees to a share of educational costs. If costs go up, tuition and fees rise accordingly.

PHOTO CREDIT: Students stroll through Sproul Plaza on the UC Berkeley campus on June 1, 2011. (AP Photo/ Eric Risberg)



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