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Governor signs 2006-07 budget
In keeping with state's compact with UC, it provides funding for faculty/staff raises. Also funded: enrollment growth without student-fee increases

| 19 July 2006

On June 30, Gov. Arnold Schwarze-negger signed a 2006-07 state budget that funds enrollment growth at the University of California, provides state funding to "buy out" student fee increases, and allows the university to offer much-needed salary increases to faculty and staff.

The budget also preserves funding for UC's academic-preparation programs for K-12 students, and it includes new funding for UC efforts to encourage and assist community-college students in transferring to a UC campus to achieve a four-year degree.

"I want to thank the governor and the Legislature for the support they have given to the students, faculty, and staff of the University of California," said UC President Robert Dynes. "This budget supports our mission as a public institution - providing students with access to a high-quality education, researching the important questions facing our society, and providing public service that improves the lives and health of people in communities across California."

The final budget provides state funding above the minimum outlined in the governor's 2004 "compact" with UC. The university's state-funded budget in the fiscal year beginning July 1 will total $3.077 billion, an increase of $234 million (8.2 percent) above the 2005-06 level.

The budget includes the following for the UC system:

Enrollment growth: Funding for enrollment growth of 2.5 percent in 2006-07, at a level of $9,900 per student. This increase allows UC to continue meeting its obligations under the Master Plan for Higher Education to offer a place to all eligible California undergraduate applicants and to continue increasing graduate enrollments, including in the health sciences.

Academic preparation and expansion of transfer programs: The final budget preserves $17.3 million in state funding for UC's academic-preparation programs, which work to improve the academic performance and college preparation of educationally disadvantaged students in K-12 schools across the state. The budget also adds $2 million in new funding to expand community-college-transfer programs to UC.

Student fees: The budget provides $75 million in state funding to avoid a student fee increase for 2006-07. "This is very good news for students and their families," Dynes said. "The governor and the Legislature recognized the university's need for additional resources to maintain the quality of our programs, and they also recognized the value in allocating state resources to give families a break from the fee hikes of recent years." The state buyout of student fees does not apply to a 5 percent nonresident-tuition hike already approved by the Board of Regents for undergraduates only. It eliminates the need for a 5 percent increase in professional-school fees in 2006-07, but does not eliminate a one-year, temporary $350 increase for professional students approved by the regents last year to help cover lost revenue associated with a lawsuit regarding professional fees.

Research: Funding of $6 million is provided for UC labor research, restoring state support for this program to its 2000-01 level. In addition, the budget provides an augmentation of $4 million for the Gallo Substance Abuse Program at UCSF.

Faculty and staff compensation: The state budget and other university revenue sources will fund an average 4 percent increase in employee compensation in 2006-07, subject to collective-bargaining requirements where applicable. "The salaries of UC faculty and staff continue to lag those at institutions we compete with, putting us at a serious disadvantage in recruitment and retention," Dynes said. "This funding increase is very welcome because it allows us to reward our hard-working employees and prevent the further widening of the salary gap. This issue will need continued attention in the budget next year and for the next several years, however. This year's increase is only a first step toward bringing all faculty and staff up to market-competitive compensation, as endorsed by the regents last November."

UC Merced: The budget continues $14 million in one-time funding in addition to $10 million in base funding plus funding for enrollment growth.
Science and math initiative: The budget includes $375,000 in addition to the $750,000 in the 2005-06 budget for UC's "California Teach" program to expand the training of high-quality science and mathematics teachers for California's schools.

Capital improvements: The budget calls for $340 million in general-obligation-bond funding for construction and renovation of UC facilities to address enrollment growth, life safety, and infrastructure-renewal needs. These funds are dependent upon Proposition 1D, an education-facilities bond on the November ballot.