State Budget

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December Brings a Special Legislative Session on the State Budget

Byuclafaculty

One of Governor Schwarzenegger’s last major actions was to call an emergency session on the state budget. Although he is a lame duck at this point and will be out of office in early January, the legislature begins anew in December. The state is carrying a legacy debt of about $6 billion in the general fund (i.e., the fund is projected to close on June 30, 2011 with a negative balance of -$6 billion). A projected operating deficit on a workload basis for next year – the year beginning July 1, 2011 – is about $19 billion. Of course, we…

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Day 3: The Regents Session of 11-18-10

Byuclafaculty

Below are links to audios (videos with a still picture) of the Regents meeting of 11-18-10. (The audio is divided into 13 parts due to duration limits of video-Yahoo.) The meeting began with public comments. In that session, a message was read from Assembly leader Perez protesting the tuition increase. President Yudof cited the lack of state pension contributions to UC in rebuttal. As in the previous day, the comments were those of students objecting to the tuition increase and unions generally objecting to the benefit changes and lack of input into them. Students also objected to the switch in…

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LA Times/USC Poll on State Budget

Byuclafaculty

The LA Times/USC poll reproduces, once again, the general public inconsistency about what to do about the state budget. Here (below) is a simplified version of the poll. The first figure is percentage support by program for not cutting spending or for increasing spending. The second figure represents percentage support for cutting spending a little or a lot. (Figures don’t add to 100% due to those answering “don’t know” or refusing.) K-12: 71% vs. 26% Health care for kids & low/moderate income families: 56% vs. 36% UC & CSU: 59% vs. 36% Transport, road, rail: 47% vs. 48% Prisons: 20%…

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New PPIC Poll on Public Higher Ed

Byuclafaculty

A new poll on public higher ed is out from the Public Policy Institute of California (PPIC). In broad terms, Californians are evenly split on whether taxes should be raised to support higher ed. But they oppose tuition increases. They are more likely to say that not enough is being spent on higher ed than to support raising taxes. PPIC summarizes the findings as follows: About three-fourths of Californians say state funding for public higher education is inadequate. Most Californians favor more money for higher education even at the expense of other state programs. Almost 60 percent of all parents…

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Day 1 at the Regents: Capital Projects

Byuclafaculty

Today (Nov. 16) was the quiet day at the Regents. No issues of tuition, pensions, etc. A bunch of capital projects were approved. There was a bit of questioning about whether the state would pay for such projects, or even float general obligations bonds to pay for them. Of course, the answer was “no.” An argument was made that UC needed to have shovel-ready projects in case someone did step up to pay for them. But that seems unlikely with the new and likely paralyzed Congress and the condition of the state budget. Nonetheless, there was little dissent. You can…

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Regents to Approve Next Year’s Budget on Nov. 18

Byuclafaculty

The Regents will be approving a budget for 2011-12 at their meeting of Nov. 18, 8:50 AM session. The total UC proposed budget for the coming year will be $22.6 billion. Of that total, $3.5 billion is requested from the state, up from $2.9 billion in the current year. Of the $600 million increase being requested from the state, $172 million is for pension funding. I will leave it to the reader to estimate the probability that the state will cough up what is being requested. You can find the budget document at http://www.universityofcalifornia.edu/regents/regmeet/nov10/f9attach2.pdf The figures to which I refer…

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The Horror, The Horror, the State Budget

Byuclafaculty

The Legislative Analyst has come out with his budget outlook. Guess what? It’s a horror story. In rough terms, last year’s budget (with all the trickery involved) was “balanced” in the sense of inflows = outflows. But it contained a legacy of past sin to the tune of about $6 billion. The budget recently enacted for this year is also roughly “balanced,” but it also carries forward the $6 billion in past sins. So if that were the extent of the problem, we would probably do what Schwarzenegger did when he took office, i.e., finance the past sins by some…

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Yudof Explains Tuition Increase in Public Letter: Tries to Mitigate Bad News with Good News But Comes Across as an Apology

Byuclafaculty

Most of the media coverage in fact focuses on the tuition increase, not the mitigating subsidies to lower income student nor the material on the quality of UC. Whether intended or not, the letter was likely seen as an apology for the increase.———————–Open letter to California fromUC President Mark G. Yudof 2010-11-08 The University of California was conceived in the immediate aftermath of the Gold Rush, and ever since the fortunes of the state and those of the university have been entwined. One would not be the same without the other. The university is both a creation of and the…

Cash Coming to State, At Least in the Short Run

Byuclafaculty

Given the state’s ongoing budget problems, why aren’t IOUs (Registered Warrants) on the horizon? Basically, the state has taken steps to deal with its cash needs, at least in the short run. Some of what it has done has been to delay payments. In effect, it has tried to coordinate its seasonal inflows of cash – some of which comes to funds outside the General Fund – with its spending. Once a budget was passed, albeit very late, that made it easier for the state to borrow short-term. Thus, the state is about to offer Revenue Anticipation Notes (RANs) to…