Remaking the University

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A blog on higher education and related issues.Chris Newfieldhttp://www.blogger.com/profile/01078395415386100872noreply@blogger.comBlogger835125
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What Berkeley's Problem is Not

Mér, 24/08/2016 - 22:43
As the Berkeley and Davis campuses seek new chancellors, they'll be looking for people who can deal with endless public university budget problems.  In Berkeley's case, there's the $150 million structural deficit that surfaced on outgoing Chancellor Nicholas Dirks' watch.  
What should the next chancellor do to fix the deficit? Chancellor Dirks raised the prospect of cuts to the academic core, but mostly stuck to the standard model of growing private revenue streams. This has meant more fundraising, more non-resident students, more high-priced "innovative master's programs and more executive education.  It also means using [public university] assets in more commercial ways." It will mean figuring out how to start raising tuition again while promoting the high tuition-high aid model.   The quotations are from Nicholas Dirks.  Privatization was what he was doing, and what he did well within the rules of the game, particularly in fundraising. Leaving aside his management mistakes to focus on the budget issues, should Berkeley look for Nick Dirks 2.0, Nick Dirks on steroids, some kind of Double Dirks? 
The deficit predated anything chancellor Dirks did. John Wilton, the campus's lead budget officer, had announced it in November 2013, and traced it to old and new forms of state underfunding.  The Schwarzenegger and Brown budget cuts did enormous damage to UC finances. For a while, budget shortfalls were covered by reserves, but several years into the era of subpar funding, these were running out. Vice-chancellor Wilton had also already factored in all non-state and private revenue growth projections. The UC Berkeley deficit has come from a combination of state, university-wide, and campus budget choices. In addition, that deficit was not going to be closed by the growth in private funding.  More on that issue below.
We get reports that senior UC Berkeley officials are pinning much of their deficit, up to $50 million a year, on a choice the university system imposed called "rebenching." This is a program to start to reduce inequities in the UC Office of the President's allocations among the campuses. For many years, a student at UC Davis received a much higher state outlay than did the same kind of student at UC Santa Cruz; the same was true for UCLA vs. UC Irvine, and so on around the system. A 2011 report by the California State Auditor found large cross-campus inequalities and no good reason why this was so. It also found that the campuses with a higher proportion of Black, Latino, and Native American students got less money per student. (See Table 6 and this post for figures and analysis.)  The pre-rebenching allocations were clearly unethical and arguably racist, and although UCOP's response plausibly denied racist intent, it worked with the Academic Senate to rebench allocations to improve equity.   
But was Berkeley supposed to pay for it all? Have a look at the 2012 report of the Rebenching Budget Committee.  The total allocated for the entire system’s rebenching was about $37 million per year, now stepped up to $46 million per year total for all campuses (page 12).  So even were the entire system being rebenched at Berkeley's sole expense, it still wouldn't come to $50 million a year.  
In any case, this is not how rebenching works. The equity funding comes
(1) from new state money (it is not redistribution but finally-equitable distribution), allocated by (2) weighted enrollments (more per-student money for campuses with large doctoral programs like Berkeley) after (3) "set-asides" for designated programs that adjusts each campus's base budget, leading to (4) a leveling up of all campuses to the top campus level (Los Angeles). 
The effect on Berkeley can be seen in my number 1 favorite recent UC spreadsheet, Appendix A of the rebenching report. First, Berkeley's reduction under the new system was a bit over $6 million (row U), far smaller than Davis's or Los Angeles' because it wasn't as overpaid, so to speak, by the established system.  Again that's much less than $50 million.  But that wasn't to be an actual loss because, after various considerations, Berkeley was to be rebenched up by about $28 million per year, or +10% on its original base budget.  The 2012 plan had rebenching giving the Berkeley campus $4,688,619 more each year for six years.  This was only half of the additional new money going to the two most underfunded campuses by equalized weighted enrollment--Irvine and Santa Barbara--but it was not a deficit maker.
Perhaps the actual allocations have not followed the plan. But if that is the case, officials should produce figures that show what has happened instead.
Here's a visual of rebenching over six years (Appendix B).
Berkeley was a bit over the old average, so seemed a loser in the socialist benchmarking paradise. But in reality it is below the new benchmark, and so is to benefit from rebenching like all campuses other than Los Angeles, which is to stay the same.  Note that this is only one of the campus's many revenue streams, does not include non-resident tuition which each campus keeps for itself, is based on weighted enrollment, etc. Note especially the deeper issue, which is inadequate state funding. This had been softened at the wealthier campuses but not at the poor ones.
Rebenching is not Berkeley's problem. So if the public system isn't sinking Berkeley, what is?
That would be a combination of public cuts, already mentioned, new costs incurred by campuses, and new costs that UCOP or the state has pushed onto the campuses in recent years. The new costs that UC campuses haven’t incurred themselves include:
  • Normal cost inflation.  VC Wilton estimated this as historically 3-4% per year, meaning the UCOP “deal” on state increases  (4% per year for a few years) is essentially a zero gain.
  • Capital projects.  The state has largely withdrawn from campus development.   
  • Pension contributions (up from zero to 14% of payroll since 2010).
  • Increased employer health care costs, including retiree health care.
  • Central administration, aka UCOP,  which is now funded via campus taxes to the tune of something close to 15% of state funding.
  • Subsidies for UCSF (a $130 million premium in enrollment-based allocations (Appendix A row J * row M)
There are also campus-based structural costs, particularly the practice of covering a large share of research costs (19% at Berkeley) with institutional funds. (Background on this can be found here.)

How do these costs hit Berkeley? A quick scan of the campus's Annual Financial Report for 2014-15 (pdf page 5) shows that pension contributions have grown from zero to $128.4 million per year.  “Other employee benefits,” which I assume is largely heath care, is up to $274.4 million.  Interest on debt and capital leases is $90 million a year (up $10 million year on year). In the realm of capital projects, "proceeds from debt issuance” fall short of “purchase of capital assets” by $140 million (and by $160 million in the previous year).   Grants and contracts income declined $40 million over one year (they  have since rebounded). At the same time, over two years, Berkeley's outlays of its own "institutional funds" to support research, mostly losses on extramurally-funded projects, increased $26 million (from $138 million to $164 million).   This is a partial list of the real contributors to Berkeley's $150 million annual deficit.  
What drives these expenses?  State politics for one: were the state to fund UC's employer share of pension contributions, Berkeley would fix $128 million of its $150 million problem.  There are also necessary growth and upgrades: some chunk of the capital project costs are in the category of always improving teaching and research. Research policy is another: federal agencies force universities to subsidize research and foundations and corporations are even worse. 
But a big general driver is what I call the price of privatization. It is expensive to compete with Stanford, Cal Tech, et al for corporate partners, non-resident students, research grants, wealthy donors, senior executives, and everything else. VC Wilton said it best: "Berkeley must now compete for its three most important revenue sources [philanthropy, students, and research] against the best private and public universities." He went on to assert, "Because 87% of our revenue does not result from a legislative process, the need to be market-competitive is essential." The decline of public funding has induced a preoccupation with competing to increase mostly private revenue streams and with covering all the costs of the market competitions on offer.
In the post-crisis scramble, where do managers draw the line between necessary investments and privatization boondoggles?  Which of the projects that created that $140 million shortfall for capital debt/assets is part of the core mission and which supports off-campus interests or a favored group? How big are the avoidable costs of competition? Which competitions should be avoided on the basis of costs? If a research and teaching mission lacks a competitive revenue market, do you tax it for the sake of someone else's market competition? When you don't really know where to draw the line, and money is cheap, do you try all of them, especially if you can launch them by executive order?  Faculty, staff, and students should be directly involved in answering these questions.  They are budgetary and also properly political.
Post-Dirks, Berkeley has a real choice between faster, better privatization (and its costs) or figuring out privatization's costs and cutting it down to size.  Ironically, dialing back is supported by the budget data of its advocates. VC Wilton probably was not telling Chancellor Dirks that privatization would work because fundraising and partnerships were magic bullets.  I think they saw it more as a muddle-through strategy designed to kludge the system for another 5 years (2013-2018) with gains from non-resident tuition, educational businesses, real estate, and endowment income, at which point UC would either start big tuition hikes again or Berkeley could gain its semi-freedom to charge its own higher tuition.
The full debate between privatization and its costs never happened.  This is in large part because of the managerial decisionism I won't discuss here, and also because, as Jacques Lacan would have expected, denial was an important part of the disclosure.  Wilton Part 1 disclosed budget strategy failure.  Wilton Part 2 hid it in plain sight.  While former Chancellor Robert Birgeneau was a true believer who could effortlessly suture the contradiction, Chancellor Dirks was perhaps unsettled by the double message that UC Berkeley’s administration has been broadcasting for a decade: we must privatize; we are more public than ever. Were this so, he would naturally seem indecisive, as though he “embrace[d] ambiguity.”   In fact, privatization is ambiguous.  It wants private money, especially high net tuition, and to keep its public subsidies, and to keep its public-mission image.  Chancellor Dirks' Chronicle of Higher Education article and his resignation memos are classic performances of the not-quite-convinced that make the model feel as unworkable as it actually is.  I assume he was following the established Berkeley administrative program.  He knew the formula.  But he hadn't swallowed the blue pill. 
Berkeley's problem isn't rebenching.  Berkeley's problem isn't the UC system. Berkeley's problem is unrestored public funding in conjunction with privatization, which raises costs while encouraging cuts.  How much does its own program grow the funding gap between what public education needs and what privatization makes us want?  I'm sure the campus can find a chancellor who is willing to find out.  

Categorías: Universidade

The Katehi Resignation

Mér, 10/08/2016 - 02:32
As you have probably heard, Linda Katehi submitted her resignation from the position of Chancellor of UC Davis today.  I don't have the time to offer an analysis of the central documents but I wanted to provide links for those of you who would like to look further into the investigative report and the various responses to it.





Chancellor Katehi's Letter of Resignation

Statement of Davis Academic Senate Chair Knoesen regarding the resignation.

Report of Investigation of Chancellor Katehi (with redactions).

Text of President Napolitano's Statement on Chancellor Katehi's Resignation.

Statement by Chancellor Katehi's Attorney Melinda Guzman in response to Report and Resignation.

On President Napolitano's confidential letter to the regents on Chancellor Katehi (Cloudminder)


Categorías: Universidade

Regents Propose Centralization Without Real Justification

Mér, 20/07/2016 - 03:50
As you may have seen, the Regents will vote July 20th on a proposed revision to their By-laws and the University's Standing Orders.  An original presentation was made at their May 12 meeting; tomorrow's discussion will be about a modified version of that proposal.  You can find the modifications here. Commentary on this has been provided by former Regent Velma Montoya (here and here), Hank Reichman at the Academe Blog has commented here, and the California Association of Scholars has sent a letter reprinted here.  I urge you all to read the various documents and commentaries but I wanted to clarify some of the important issues quickly.

The proposal combines two major sets of changes.  The first is a dramatic alteration in the Regents committee and meeting structure--an alteration that could reduce both public debate and oversight in important ways.  And second, the proposal begins a process that will likely result in the elimination of the Standing Orders of the University.

These proposed changes have led to a wide range of criticism. The weakness of the arguments in favor of these changes suggests more fundamental problems with the current status of the Board of Regents.

1) At present the Regents have 10 Standing Committees.  The proposal reduces this number to 6 and vests important internal power to the Governance and Compensation Committee.  In addition, the Chair of the Board, Chairs of Committees, and the President of the University are being given the authority to determine the scheduling of discussion whenever an individual Regent wants an item added to an Agenda (3).  Importantly, although Committee meetings are traditionally held sequentially under the new system, different Committees will meet concurrently during the 1st day of the Regents meeting, making it more difficult for newspapers, members of the University community, and members of the public to attend all the meetings they are concerned about. Interestingly, there will no longer be a Long-Range Planning Committee.

It is, of course, impossible to know how these changes will actually affect the Regents practice.  But having listened to the discussion at the May meeting, I am not confident that they serve any purpose other than the centralization of power.  In discussing the origins of these proposals, proponents suggested that they grew out of a Regents retreat and were a response to the sense that too much time at meetings was spent listening to reports from administrators.  I have a great deal of sympathy for anyone forced to suffer through an administrative filibuster.  But there is a simple way to avoid that--demand that all reports be in writing, sent in advance, and then read them before the meeting.  That way you can push back against the filibuster by asking intelligent questions or raising objections. If the individual Regents are too busy to do that then they should just decline the honor of serving on the Board.

Reducing the number of Committees and dividing up Committee presentations will not solve the problem of too much transactional activity--all it will accomplish is reduce the possibility of public oversight and also increase the specialization of Regents even if the second day has a long plenary session.  As with their reorganization of the Health Care Committee--where a report indicating a problem of communication internal to the Health Sciences enterprise led to an expansion of central power under the Regents--the Regents have identified one problem and proposed a solution to something else.

2) The Governance Committee is also proposing that the Standing Orders be absorbed into the newly drawn By-Laws.  Although I don't agree with the CAS that the Standing Orders function as some sort of legislative record, they are correct that they should not be folded into the By-Laws.  (It is the fact that they are not a legislative record that gives them their importance).  The Standing Orders as they stand now have been infrequently changed and they are extremely detailed.  It is their public detail that makes them so important.  To give only one example, when the Regents determined that they wanted to give President Yudof special furlough powers they needed to make explicit changes under public scrutiny--scrutiny that produced a great deal of debate.  To be sure, the Regents did what they wanted to do--as is their wont--but they needed to do so publicly and with their responsibility marked out. If you want wider input, then publicity is important. Of course if you don't, then having vaguer rules will have that effect. The new By-Laws are in fact much vaguer than the Standing Orders, which will allow for changes with less scrutiny. One argument made in favor of this change is that the By-Laws take a 2/3 vote to change while the Standing Orders only require a majority vote. But the simple answer to that is to make the Standing Orders require a 2/3 vote as well.

In a nutshell, the Regents are considering a set of changes that may make it more difficult for the public to see what they do at their meetings and allow for policy changes to proceed along vaguer than usual lines. At a time when UC administrators are under increased scrutiny and the University itself is viewed with greater suspicion of being out of touch with the State, the Regents are proposing a major overhaul of their organization and relation to the public without real justification or careful university wide discussion.  That one likely result will be greater control in the hands of fewer Regents is a cause for alarm. The whole process highlights fundamental problems with the practice of Regental governance.
Categorías: Universidade

North Carolina Republicans Take Aim at State's Historically Black and Native American Colleges (UPDATED 6/7/16)

Lun, 23/05/2016 - 15:24
Although overshadowed by North Carolina's recent HB2 (forbidding transgender individuals from using the bathroom of their choice), the state's Republican majority has proposed a bill that could seriously undermine the colleges and universities that have traditionally served North Carolina's minority population.  Despite its proclaimed aim to address the problem of student debt, SB873 likely will exacerbate the state's inadequate funding of Higher Education in general (a reduction of over 23% in State funding between 2008-2015) and potentially devastate the finances of four institutions that historically focus on African-American and Native American students. It would also encourage them to increase the number of their out of state students and overturn decisions made by students about projects they wish to support with their fees.

Although notable for its explicit emphasis on institutions that serve primarily minority populations within the state, the North Carolina proposals are simply the latest in a series of legislative interventions into the decision making of public universities.  These interventions combine a reduction of state funding with increasing micro-management in the name of the interests of students.  As with recent cuts in Wisconsin and Illinois, North Carolina's Republican legislative majority has assumed a populist mantle while pursuing policies that would have their greatest negative effects on those colleges and universities that have the fewest resources and that serve the poor and people of color.

SB873 has several key elements:

First, the law institutes a regime that would ensure that tuition prices and student fees are held constant for students who complete their program in 8 semesters (10 for those in 5 year program), and for a time to be determined for transfer students.  There is no provision about tuition raises for each entering class nor any indication of increased state funding, so one likely result is that institutions will expect those who enter later to subsidize those who have entered earlier.

Second, it would simultaneously force a cut in student fees, starting in 2018. Strikingly, the law requires that student fees be cut between 10 and 25% below 2016 fee levels.  Apparently this would all but prevent the construction of a new student union at NC Central in Durham--a campus and location known for its traditions of political activism, especially around civil rights.  It may be a coincidence.  I'll leave that to you.

These first two elements--in the context of North Carolina's reduced funding for higher education--threaten to further undermine the overall quality of the state's higher education system. On the question of fees, which are often voted on by students, it represents the legislature's continuing intrusion into university life and their undermining of the University System's autonomy.  On both questions it remains unclear how Margaret Spellings, recently appointed as President of the University System, will react.

But the real heart of the Bill is in the sections dealing with the colleges and universities that have traditionally served North Carolina's minority populations.

1) SB873 lowers the tuition per semester for 5 institutions to $500 per semester. 4 of these institutions have made it their mission to serve historically under-represented groups (the fifth, Western Carolina University, has not had the same mission).  To give an example of the effect, one of the institutions (Winston-Salem State University) currently charges $1619 per semester.  So the law would reduce tuition revenue by over 2/3.  Although the prime author of the bill has indicated that the legislature might raise funding to compensate, there is no such clause in the bill or anything on the horizon. The University's Faculty Assembly estimates that this clause of the bill will cost the four minority institutions roughly 60 Million dollars annually.

2) At the same time as the bill would cut tuition revenue from residents, it also encourages the 5 institutions to increase their reliance on non-resident students. Currently, there is an 18% cap on non-resident student populations.  The Bill urges the campuses to reconsider this cap and to consider seeking more out of state students if it would "increase the number, academic strength, and diversity of student applications at those institutions." (3)  The likely result, as the Faculty Assembly notes, would be "non-minority students displacing minority students in the admissions applications pool." (4)

3) The Bill also encourages the University System to consider changing the names of these institutions.  This suggestion is a real puzzler unless the purpose is to ensure that people no longer connect these universities with their historic missions.

4) The Bill does include new funds for merit scholarships to help a small number of students to attend either North Carolina Agricultural and Technical State University and North Carolina Central University (40 in-state and 10 out of state students at each institution).  These are the State's other two HBCUs and they are currently on a stronger footing. By providing some increased incentive to attend NCA&T and NCCU while cutting tuition at Elizabeth City State University, Fayetteville State University, University of North Carolina at Pembroke, and Winston-Salem State University it appears that the State intends either to push the latter four institutions from their tradition mission of access or into financial insolvency.

Jelani Cobb has suggested that North Carolina's efforts to control access to public bathrooms is a haunting return to the late 1950s and early 1960s battles over civil rights--including the conflict between federal and state authority, and the declaration of state's rights and God's morality against a minority seeking equal access to public facilities.  SB873 is more than an echo.  After all, passed it threatens to undercut access to higher education for North Carolina's minority population while prompting targeted institutions to shift their demographics to out of state students or to students with less connection to the Universities' traditional missions.  Although done in the name of populism, it is a reactionary populism.

If North Carolina's legislators are really concerned with ensuring access at low prices to all of the state's students then they should fund the freeze, as Nicholas Fleisher has argued regarding similar developments in Wisconsin.  Otherwise their professed concern for students is simply empty rhetoric.

You can find the proposed law HERE

Analysis by the University's Faculty Assembly is HERE

UPDATE:  In response to criticism from the University of North Carolina System and the individual universities, the lead sponsor of the Bill has withdrawn the 3 Historically Black Universities from his proposal of a dramatic tuition cut although UNC Pembroke will still be covered..  Inside Higher Education has the story HERE.


Categorías: Universidade

North Carolina Republicans Take Aim at State's Historically Black and Native American Colleges

Lun, 23/05/2016 - 15:24
Although overshadowed by North Carolina's recent HB2 (forbidding transgender individuals from using the bathroom of their choice), the state's Republican majority has proposed a bill that could seriously undermine the colleges and universities that have traditionally served North Carolina's minority population.  Despite its proclaimed aim to address the problem of student debt, SB873 likely will exacerbate the state's inadequate funding of Higher Education in general (a reduction of over 23% in State funding between 2008-2015) and potentially devastate the finances of four institutions that historically focus on African-American and Native American students. It would also encourage them to increase the number of their out of state students and overturn decisions made by students about projects they wish to support with their fees.

Although notable for its explicit emphasis on institutions that serve primarily minority populations within the state, the North Carolina proposals are simply the latest in a series of legislative interventions into the decision making of public universities.  These interventions combine a reduction of state funding with increasing micro-management in the name of the interests of students.  As with recent cuts in Wisconsin and Illinois, North Carolina's Republican legislative majority has assumed a populist mantle while pursuing policies that would have their greatest negative effects on those colleges and universities that have the fewest resources and that serve the poor and people of color.

SB873 has several key elements:

First, the law institutes a regime that would ensure that tuition prices and student fees are held constant for students who complete their program in 8 semesters (10 for those in 5 year program), and for a time to be determined for transfer students.  There is no provision about tuition raises for each entering class nor any indication of increased state funding, so one likely result is that institutions will expect those who enter later to subsidize those who have entered earlier.

Second, it would simultaneously force a cut in student fees, starting in 2018. Strikingly, the law requires that student fees be cut between 10 and 25% below 2016 fee levels.  Apparently this would all but prevent the construction of a new student union at NC Central in Durham--a campus and location known for its traditions of political activism, especially around civil rights.  It may be a coincidence.  I'll leave that to you.

These first two elements--in the context of North Carolina's reduced funding for higher education--threaten to further undermine the overall quality of the state's higher education system. On the question of fees, which are often voted on by students, it represents the legislature's continuing intrusion into university life and their undermining of the University System's autonomy.  On both questions it remains unclear how Margaret Spellings, recently appointed as President of the University System, will react.

But the real heart of the Bill is in the sections dealing with the colleges and universities that have traditionally served North Carolina's minority populations.

1) SB873 lowers the tuition per semester for 5 institutions to $500 per semester. 4 of these institutions have made it their mission to serve historically under-represented groups (the fifth, Western Carolina University, has not had the same mission).  To give an example of the effect, one of the institutions (Winston-Salem State University) currently charges $1619 per semester.  So the law would reduce tuition revenue by over 2/3.  Although the prime author of the bill has indicated that the legislature might raise funding to compensate, there is no such clause in the bill or anything on the horizon. The University's Faculty Assembly estimates that this clause of the bill will cost the four minority institutions roughly 60 Million dollars annually.

2) At the same time as the bill would cut tuition revenue from residents, it also encourages the 5 institutions to increase their reliance on non-resident students. Currently, there is an 18% cap on non-resident student populations.  The Bill urges the campuses to reconsider this cap and to consider seeking more out of state students if it would "increase the number, academic strength, and diversity of student applications at those institutions." (3)  The likely result, as the Faculty Assembly notes, would be "non-minority students displacing minority students in the admissions applications pool." (4)

3) The Bill also encourages the University System to consider changing the names of these institutions.  This suggestion is a real puzzler unless the purpose is to ensure that people no longer connect these universities with their historic missions.

4) The Bill does include new funds for merit scholarships to help a small number of students to attend either North Carolina Agricultural and Technical State University and North Carolina Central University (40 in-state and 10 out of state students at each institution).  These are the State's other two HBCUs and they are currently on a stronger footing. By providing some increased incentive to attend NCA&T and NCCU while cutting tuition at Elizabeth City State University, Fayetteville State University, University of North Carolina at Pembroke, and Winston-Salem State University it appears that the State intends either to push the latter four institutions from their tradition mission of access or into financial insolvency.

Jelani Cobb has suggested that North Carolina's efforts to control access to public bathrooms is a haunting return to the late 1950s and early 1960s battles over civil rights--including the conflict between federal and state authority, and the declaration of state's rights and God's morality against a minority seeking equal access to public facilities.  SB873 is more than an echo.  After all, passed it threatens to undercut access to higher education for North Carolina's minority population while prompting targeted institutions to shift their demographics to out of state students or to students with less connection to the Universities' traditional missions.  Although done in the name of populism, it is a reactionary populism.

If North Carolina's legislators are really concerned with ensuring access at low prices to all of the state's students then they should fund the freeze, as Nicholas Fleisher has argued regarding similar developments in Wisconsin.  Otherwise their professed concern for students is simply empty rhetoric.

You can find the proposed law HERE

Analysis by the University's Faculty Assembly is HERE




Categorías: Universidade