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UC cuts administrative costs, seeks new revenue

The University of California Board of Regents met Wednesday and Thursday, Jan. 18 and 19, at UC Riverside to discuss savings from cost-cutting and development of new revenue to fill a looming budget gap.

But discussion of private contributions as a way to bolster student financial aid had to be put off to March after a group of fewer than 20 protesters disrupted the meeting for nearly an hour.

During the two days of meetings, senior administrators outlined for the board the latest state funding proposal and discussed a variety of initiatives now under way, including efforts to pare operational costs and enhance revenue opportunities from new inventions.

“Last month we took another $100 million cut in state support for a total 2011 budget reduction of $750 million. That’s a 25 percent cut from the previous year’s funding,” said chair Sherry Lansing. “Believe me, this board is working diligently to find alternative funding strategies and creative solutions to this budget crisis.”

Efforts include a complete overhaul of how UC delivers human resource and payroll services to faculty and staff, and a program to help faculty with early-stage discoveries attract the venture capital necessary to bring products to market.

Dozens of students — some of whom were not from UC — turned out for the meeting Thursday, and were vocal in their anger over the rising cost to attend the university. Following the public comment period, the meeting was briefly disrupted when 15 members of Occupy UC locked arms and began chanting.

Campus security cleared the room, and the meeting resumed without incident about an hour later. During the ensuing hours, hundreds of students outside the building where the regents were meeting protested state funding cuts and rising tuition.

State support

Administrators, in speaking about various budget strategies, stressed that state funding remains a critical part of UC’s financial equation, particularly as it relates to tuition levels.

To that end, talks are ongoing with the governor’s office and the Department of Finance over a possible multi-year funding plan, said Patrick Lenz, UC’s vice president for budget and capital resources.

Regents commended administrators for securing an acknowledgement that California has a fiscal obligation to the university’s retirement plan.

The state pays the employer share of retirement costs for the California State University and Community College systems, as it once did for UC. For the past several years, UC has called on Sacramento to give it equal treatment.

“The governor has re-established the principle that California has a responsibility to contribute to UC retirement costs,” President Mark G. Yudof said. “This is a step in the right direction, and we applaud it.”

Also worthy of applause are UC’s efforts to cut costs and find new sources of revenue. On the administrative efficiencies front, UC’s Working Smarter program is well on its way to meeting its goal of producing $500 million in savings that can be funneled into the academic mission.

  • Through changes to its Enterprise Risk Management program, the university in 2011 saved $101.2 million on insurance and other costs.
  • Energy efficiency measures have made UC the greenest university system in the nation, while saving $32 million annually in energy costs.
  • The UCPath Initiative, a four-year program to move UC to a single, universitywide payroll and HR system, is expected to save the university up to $100 million a year.

UC also is looking at a variety of ways to enhance entrepreneurship on its campuses, to make more of its inventions into useful products.

Go to the UC Newsroom for the complete story by Carolyn McMillan, UCOP managing editor for Internal Communications, including links to additional reports from last week’s meeting.

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