Episode Nine, September 5, 2003
This special edition of Bear in Mind focuses on how the California
state budget cuts affect UC Berkeley. To help answer questions submitted
through the Budget
Chancellor Robert M. Berdahl (right) invited Paul
Gray, Executive Vice Chancellor and Provost; Horace Mitchell, Vice
and Administrative Services; and Matt Murray, UC student Regent and
Berkeley architecture major (above, from left).
The discussion has been transcribed below, including some
sections that were cut from the audio version for length. Skip to
a particular question of interest using the links on the left side
of this page.
Special episode: The Budget
Berdahl: Welcome to this special edition of Bear in Mind, devoted entirely to the state of the budget. This is part of our continuing commitment to keep the campus as informed as possible about how budget cuts are affecting the Berkeley campus.
The New York Times last Sunday ran a decidedly bleak front-page story on how public colleges and universities across the country have been grappling with record budget cuts and enrollment growth at the same time. The picture the article drew was of dire times — the University of Illinois has cancelled 1,000 classes, the University of Colorado has eliminated programs in journalism, business and engineering and it noted that in California, the new UC Merced campus has been put on hold, while the Cal State system may need to turn away 30,000 students come spring.
At Berkeley, the situation is not as dire we have turned away no students and we have largely protected the academic program. But we are faced with a $25.5 million reduction in state funding this fiscal year. And that makes it difficult for everyone here. It is difficult for students paying higher fees, for staff who face job cutbacks and workload increases, and for faculty seeing reduced state research funding and other resources cut back, as well as no salary increases during this year.
To discuss the current state of affairs, we brought together a panel with budget expertise and insight related to the students, the staff and the faculty. We have with us today Paul Gray, Executive Vice Chancellor and Provost and the chief academic officer on campus. Welcome Paul.
Gray: Thank you, Chancellor Berdahl.
Berdahl: We have Horace Mitchell, Vice Chancellor for Business and Administrative Services. Horace, thank you for joining us.
Mitchell: My pleasure, Bob.
Berdahl:…and Matt Murray, student Regent and Berkeley senior majoring in architecture. Nice to see you, Matt.
Murray: Nice to see you again.
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Berdahl: We've all been meeting with faculty, staff, and students as the fall
semester gets underway in the shadow of the state budget cuts. What are each
of you hearing in classrooms and meeting rooms and out on the plaza? Paul,
I know you met with the deans and department chairs last week. What are you
hearing from them?
Gray: Well, yes, each fall, in the beginning of the fall semester, we gather all the deans and chairs on the Berkeley campus for a two-and-a-half day retreat, and it does give a good opportunity to get a sense of how they're experiencing the budget cuts. It was an occasion of real mixed emotions. There was some relief because it's clear that, despite the difficulty of these cuts, we're going to be able to deliver a Berkeley-quality educational experience in the classroom for the students this year without a great deal of diminution — we'll talk about some aspects of that later this morning — but there is a great deal of concern.
Most of the concern is about people. Are we going to be able to continue to
attract the very best faculty to the Berkeley campus, given the fact that we're
having an extended period of time without salary increases for them? The chairs
in particular are quite concerned about the staff, and the workload that the
staff will experience as a result of this and the salary competitiveness for
staff. The students we're really concerned about because over a long period
of time we want to make sure that they continue to get the educational experience
in the classroom, but particularly they're likely to experience some longer
lines and some reduced service with the nonacademic things that they experience
in the coming year, so those are the emotions of the deans and chairs. They're
really quite concerned about the people aspects and the impact there.
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Berdahl: We have succeeded in trying to protect the instructional core of the campus, and in many ways that gets translated by some people as saying we don't care about the rest of the campus. What would you say about that, because that certainly isn't our intent. How would you respond to that?
Gray: The budget legislation that was passed actually contained a mandate that we protect the instructional program on the Berkeley campus, in all the UC System for that matter, and make the reductions elsewhere. Had we followed that to the letter of the law, it would have meant that we would have done no reductions at all in any academic unit and placed all those reductions in other areas of the campus.
We decided to balance things a little bit by making some temporary reductions in the academic units on the campus, which we think can be absorbed fairly easily using resources available to deans and chairs of a temporary nature so that the services and activities that are outside the classroom can be affected a little bit less. We felt that would cushion the blow to the student experience in areas other than just the academic program in classroom.
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Berdahl: Horace, what are you hearing from managers and staff about the status that we're in?
Mitchell: I'm hearing many of the things that Paul has heard, and I attended a portion of the deans' and chairs' retreat and got some of that feedback as well. What I hear are managers and staff being worried about is that on the one hand, our staff are very dedicated to serving the university, and so there's been some concern about whether or not they'll have the capacity to do that in quite the way that they're accustomed to under the current circumstances. A lot of time is being spent looking at how services can be reorganized, how we can utilize technology more effectively, and how we can consult with students and departments on the campus to make sure that we have a mutual understanding of the appropriate expectations in this particular budget environment.
Berdahl: Are some of the areas that have been hardest hit in business and
administrative and business services with these budget cuts?
Mitchell: Yes, several as it turns out. Business and Administrative Services is the area of the campus that has the highest number of state-funded, nonacademic staff, and a very large percentage of those staff are in Physical Plant. So there'll be a very significant impact on Physical Plant, and what Physical Plant does on the campus, as you know, is take care of the buildings and grounds and maintenance and utilities and such, and so we're looking at some major reductions. So the grass might not get cut as often, or the hedges, or departments might have to make some choices about getting the floor waxed or getting the trash picked up more often.
Another important area is the whole student services area, particularly I would say the Tang Center that is, the student health center. There, we're talking about reductions in staffing that result in students having to wait a little bit longer to see psychologists or physicians or having to pay a little bit more for ancillary services like laboratory or radiology or some of these services, and also greater access to community resources.
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Berdahl: Matt, you're a representative of the students on the Board of Regents and had the unenviable task of having to decide whether to support fee increases that went to students and heard all of that debate. What are you hearing from students about the situation that they're facing?
Murray: Well, I think that the students come back to campus and they're paying a lot more and getting less, and it's really an unfortunate situation. Generally, I would echo what the vice chancellors have said about student services in particular. Our students are waiting in longer lines, students have less access to the Tang Center, the health center — there's an article in the Daily Cal, the student newspaper, about that. This is the first week of class and I already have friends who are not getting into the classes that they want. I know we're doing everything we can to prevent the budget from impacting the academic experience, but it is. We can't be naïve about that, and I think that that's really unfortunate.
The fees are 40 percent higher right now than they were a year ago at this time. And I think that the last thing that upsets students the most is the lack of notice about these changes. These changes happened this past summer, the result of a terrible budget situation with the state. I took summer school and found out five days before summer sessions that fees were going up for summer school. That was very unfortunate. For Fall semester, I found out a month before fall semester started out, [when] people have already filled out financial aid applications.
Berdahl: You're a member of the Board of Regents, and it is the Board of Regents that passed those fee increases at a very late date. Why didn't you see to it that they passed them sooner, or dealt with the issue sooner?
Murray: I voted against the fee increases and the reason that I did that is because this is a larger issue. The Regents don't have the entire power over what the fees will be, it's a state budget issue. This is really another one of the results of the state not having a budget until a month too late, and bickering among state legislators about what to do. The state Republican caucus decided not to raise any taxes, the Democrats didn't want to cut services as much as the Republicans were asking them to, and they wouldn't agree on something.
I don't think the Regents like raising fees. It's sometimes easy to be a student or someone else in the university and blame the Regents for everything. They're not all good at everything they do, but they're not all bad either, and I think it's important to realize that this budget situation is part of a much larger political discussion, statewide.
Berdahl: I think your observation about the Regents not wanting to raise fees is a very true. You watched them grapple. Do you think it was a hard decision for the Regents to come to?
Murray: I think it was and I think part of that is because, as I said, I think most of them don't like the idea of raising fees. It's not good to talk about the Regents as some sort of mass that agree on everything, because they disagree as most people do, but at the same time, I would have liked to see them be more aggressive in their stance with the State Legislature. I think that the Legislature took for granted that we would raise fees a significant amount and I think the Regents could have done more to fight back on that.
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Berdahl: One of the guiding principles in managing this year's budget shortfalls is that decisions from where to streamline efforts, where to make cuts, are to be made by those principles that we have defined at the lowest practical operational level, that is, to really bring it down to "where the rubber hits the road," and have the decisions made in a way that people who know what the impact will be will try to minimize that impact as far as is possible.
Horace and Paul, how do you see this principle having worked? Has it been successful or have people ducked hard decisions?
Gray: I think it's worked well. I'll just give you one example. When we implemented the temporary reduction in the academic units for one year, the 5 percent I mentioned, we simply let the deans decide how to do that. We didn't tell them to take it in one form or another, and some of the deans came up with amazingly creative ways to do that. One dean, for example, had all of his faculty partially meet that by simply taking all of the interest they had on some of the grant funds that they had in accounts that had accumulated and used that. That particular dean happened to have a faculty with a lot of grants and contracts so they could do that.
Other deans had other resources to draw from, so we were able to let the creativity of some of the administrators come to bear when a centralized approach might have given us a less optimum result.
Berdahl: Horace, how about in Business Services?
Mitchell: We've certainly used that approach in Business Services as well, but I'd have to say that we didn't quite have the level of flexibility that Paul was describing in some areas. If you think about some of the areas in Business Services, we're talking about Payroll and Disbursements and Human Resources and these other kinds of units that have ongoing transactional responsibilities on a daily basis, serving essentially every person on the campus. So we've looked at all of those issues and we've asked the staff who are providing those services what their ideas are, and we've had some very good ideas about things, particularly in the area of some reduction in processes. If we didn't do this, we could be more effective and a bit more timely, and if we change this to use this kind of technology, that would help. That kind of input has been really important in helping us try to minimize the actual reduction in service given the reduction in staffing.
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Berdahl: Matt, coming back to the fee issue, over the last six years before
this year, fees have not been raised and in fact went down 10 percent during
that time frame. Do you think it would have been better had the university
raised fees 10 percent each year, or some predictable percentage each year
that would have equaled the same amount by the time we got to this year, rather
than having gone long periods with no fee increases and then having this fairly
Murray: Well, I think that most people would agree that that sounds like a rational way to do something. It's very difficult to absorb a very large increase at one time and that's part of the problem of what's happening, but I don't think that it's politically feasible. I think that, as I said, this budget discussion that we're in is part of a larger state politics, and to assume that the legislature would then not force us to increase fees or give us large budget cuts in bad times anyway, given that we had gradually increased our fees, is politically naïve. It's not a very pleasant answer. I personally feel that it's very difficult to come up with a rational way of doing fees in our political situation.
Berdahl: OK, so you really don't see an alternative to the way it's been dealt with, other than the state simply putting more money into higher education.
Murray: I think that the alternative is the state putting more money into higher education and I think that's really what I say the solution to these problems is — that people become aware that the state is not prioritizing higher education, and go out and vote and participate in the political process. Elect representatives who will prioritize higher education and hold them accountable to that. It's not a clean, easy, rational way of doing things but that's how our society works, the democratic society and that's the solution that I provide.
Berdahl: Any last thoughts before we move to the next segment where we get the questions that have come in response to much of what's been going on?
Gray: Well, let me follow up, for just a second, on what the deans and chairs were thinking at the retreat. I think there was an underlying, longer-range concern that I perhaps should refer to, and that is: What's going to happen to the long-term commitment in the state of California to public higher education? The state for 50 years has had a system which, both in terms of quality — the national stature of the campuses — and in terms of access — the level of the fees that the students pay — has been the envy of the country and the world. The state's been willing to support that. When the last budget downturn came in the '90s, a lot of us kind of wondered, "Is that commitment still there and are we going to recover?" And we did. It was a temporary fluctuation. I think many of us are worried again about this reflecting a diminishing of the state's commitment to support the best higher-education system in the country and the access to it that the low fees mean. I think a lot of the academic faculty and the deans and chairs are very worried about that.
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Berdahl: There was an editorial in the New York Times this week that talked
generally about funding for higher education in the United States and how that
has deteriorated, and as we know, 70 or 70-plus percent of students in higher
education are in public institutions. Do you think that there's a danger that
we're moving to a really a very bipolar system, where the rich will have access
to very elite private institutions and everyone else will be at under-funded
Gray: One would have to worry that there's a danger of that. Of course in California we have institutions like Berkeley and UCLA that complete directly with those private institutions and have done so very successfully. The real issue is whether the public support for that is going to continue or not. I certainly hope so.
Murray: I would echo the Provost's concern. I would think that that's the long-term fear, because the University of California is the leading public higher-education institution in the world. To have the state give up on that promise of quality and access… We can have a quality institution, but the University of California educates 200,000 students a year. The Harvards and Stanfords and Yales of the world do not, and I think that that's really vital for us to maintain. I certainly have that long-term fear and I hope that others would agree and participate in the political process to make sure that it doesn't take place.
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Berdahl: Thank you. I'll join our panelists now for the next segment and instead of asking the questions, will try my hand at answering them. I think it's a lot more fun and easier to ask the questions than to answer them.
Marie Felde, from our Office of Public Affairs, will read the questions, many of which have been submitted to the NewsCenter's budget website, Budget
Central. Marie, what's the first question?
Felde: Thank you Chancellor Berdahl, and in fact the first question is for
you. It is, in fact, a question about the library.
The last time the campus faced such difficult financial times in the early '90s, the library took a big hit. You allocated funds year after year to build it back up, and now again the library is at the top rank. Is another slide inevitable?
Berdahl: I certainly hope that another slide is not inevitable. During the past several years, we have had a combination of funds invested in the library. During the good years that the state enjoyed prior to the crash, the state added roughly $600,000 a year to the library budget. And we, because of the commitment I had made early on in my administration, also added several hundred thousand dollars a year to that budget. So we were able, through both of those resources, to build the collections back, to build the staffing of the library back to the point that we had moved from where we had been previously after that early downturn in the 1990s — somewhere between fifth and sixth place among academic libraries in the United States — back up to the place where we had aspired to be and that was No. 3, recognizing that we might someday overtake Yale if we keep putting money into this, but it will be impossible ever to overtake Harvard because they've got a 200-year head start on us in this endeavor.
But we are, despite the reduction of the state funds, carrying forward with the commitment we made to the campus — and particularly to Tom Leonard when he became the new librarian — to continue the investment that we were making as a campus of additional resources in the library. So, obviously, the early '90s was a protracted period. How well we do depends on how long this budget crisis endures. We simply do not want to return to the situation that we had, where I think most of the complaints that I got from faculty in those early years that I was here were about the diminution of library resources. We have not had any of those complaints in the last several years. The library, I think, is in good shape with good leadership and a wonderful staff. We hope very much that we're able to continue that support.
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Felde: The next question is directed to Chancellor Berdahl and/or Vice Chancellor
Gray. One of the issues that continues to arise is over the campus's use of some of its fund sources. This is commonly referred to as "unrestricted funds." First, can you tell us what these funds are, and secondly, why are they not used to stave off layoffs and other cutbacks?
Gray: Let me try that one. There really are two things that this question could refer to. One is, if you look at a financial statement from the University of California at any point in time you see some large balances in certain funds that the university has. Those balances are, for the most part, funds that are already committed. It's a little like looking at your checkbook on the 28th of the month and seeing a balance of $500 and saying ‘Wow, I've got a lot of money,' but you've got a $400 house payment due on the 1st. It's a little bit like that. The corresponding example here is that we hire faculty and they come to campus. At that point in time, we commit some funds to help them start their laboratories. Those funds are typically not expended right away, it takes six months or a year for them to actually buy that equipment, but in the interim that money is sitting in their account. So that gives the appearance of a large balance, when in fact those funds are committed.
The other part of that question could refer to the fact that we do have on the campus a large fraction of our resources that are restricted. They're state funds that have to be spent a certain way. There are also gift funds that come from donors. There are other kinds of funds that have less restriction on them in how they're spent than state funds do, but those are the funds that we use to plug holes that aren't covered by state funding.
I'll just give you an example. The seismic upgrade program that we have on
the campus — we use state funds to do the actual seismic correction of buildings,
but every one of those projects brings about with it the need to move faculty
around, and the unrestricted funds are the only thing we have available to
pay for that. The state doesn't pay for that. So there's a lot of things that
that are not covered by state funding, and we really need these unrestricted
funds, gift funds and other kinds of unrestricted funds to fill in.
Berdahl: I would simply echo what Paul has said. There is the perception that there are large amounts of untapped reserves that the university has. They are constituted, as Provost Gray has indicated, really of funds that are committed for purposes.
We just went through the budget this morning and looking at what the chancellor's discretionary funds are for the year that are derived from gifts that have no specific purpose, and we typically have in that category, about $600,000.
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Felde: Matt, topic A, certainly for students on this campus, has been fee increases.
Felde: We've talked a bit about those today but is there anything more that
you would say to students who wonder, every year that they attend, is this
going to get more and more expensive for them?
Murray: Well, I certainly hope it's not going to get more and more expensive for them. I think that part of the answer to that question will be what happens in the next month or two with the special election on October 7th. For example, the governor of the state for the next three years is up for decision, and whoever that person is will have a huge impact on what student fees and the university's budget in general will be. I think we talked a little bit about gradual increases or how to avoid these fluctuations…really, I think that the answer is a political question that comes down to state politics. A lot of people don't like that, and I'm not a political science major, but we have to realize that politics have profound impacts on our lives, as students and as staff and faculty here at the university, and we need to be engaged in those decisions. Register to vote by September 22nd and go and vote on October 7th is, I think, the answer that I would give.
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Felde: Vice Chancellor Mitchell, this next question is for you. We know that
the campus has said that the equivalent of 200 positions will be lost because
of the budget shortfall. Can you tell us how many of these have come through
layoffs and how many through keeping positions unfilled? And in keeping these
positions unfilled, how will these actions affect the campus?
Mitchell: The actual numbers that we're looking at [related to budget cutbacks since July as well as program changes since the first of the year, such as the closing of the Forest Products Lab] are at this point are upwards of the 200 number, and we're probably looking at closer to 300 or so in terms of total positions lost. What's been happened, as you point out, about 60 percent or so of those positions have been held vacant over the last several months as departments have anticipated the need to have permanent reduction in their budget. So, when we look at the number of staff who are jeopardy of being laid off, or received layoff notices at this point, rather than the 200-plus, we're looking probably at around 127 or so staff.
Now, in terms of the overall size of our staff, in terms of total headcount of more than 14,000, that doesn't seem like a whole lot. But for those individuals, this represents a very significant blow to them, in terms of their ability to take care of their families and do the things that they're expected to do. And in terms of how it affects the campus, what it means that in anticipation of these cuts, some departments have been cutting back in some of the services that they offer on the campus. We're just now, as the budgets are being finalized, getting to the point where we can see the overall magnitude of those cuts. There's some things that we're going to mitigate that that I can talk about later.
Felde: Well. that actually might be the question that is of most interest.
What is the campus doing to assist those employees who have lost their jobs?
Mitchell: Right. One of the things that we're doing is that many staff have the option of going on our Preferential Rehire List, or getting severance pay. For those staff on the Preferential Rehire List, what we do is we work with them as positions are open to try and place them in open positions. We've been able to place quite a number of staff just through that particular process.
The other part of that process is that before we post positions to the general public, we try to see if there are staff in the university who can be appointed to those positions. So in terms of processes in the campus, that's that.
With respect to what we're doing specifically to help laid-off staff, there's quite a number of things that we're doing. One of the things is that we have a computer lab in Human Resources that staff can use to develop their résumé, to look at a whole range of issues and skills development. We provide assistance. We have recruiters from the employment unit who help with that. We also provide résumé review and development. We assist staff in writing cover letters for jobs. We also provide opportunities to assist staff in posting resumes on the Internet. We also provide six months of ongoing support where they have access to these resources, including a recruiter to help them both with positions on the campus as well as positions that are outside the university. We've tried to be very sensitive about how we can assist under these circumstances.
Berdahl: I think that it should be noted that one of the principles that we articulated from the very beginning of the review process for how we would accommodate these budget reductions was that layoffs would really be a last resort, that we would minimize the impact of layoffs, and that is one of the reasons that I think the layoffs have been relatively — painful as they are — restricted in number and more vacant positions have been held and sacrificed than having to lay people off.
Mitchell: To some extent, part of what was happening before was that we had a number of positions on the books as being open, that in effect people were leaving open and using the resources to cover reductions.
Berdahl: And those are the ones that go down.
Mitchell: Absolutely. Absolutely. So that number was a little artificially high in some respect but we're certainly getting down to what the true numbers are. And we're still recruiting for positions that the Chancellor referred to, but they are specialized positions in various areas, to the extent that staff who have been laid off have the skills for those jobs, as I've said before, they get a first crack at being placed in those positions.
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Felde: The next question is also for you, Vice Chancellor Mitchell. Can you
tell us how student services, which are being affected to a certain extent
by staff cuts, are affecting the Tang Center, the University Health Services?
Mitchell: Yes. The Tang Center is also another one of those vast units. You might recall that in the budget process, the student registration feefunded student services unit had a mandatory 20 percent budget reduction.
Berdahl: That was by the Governor's recommendation.
Mitchell: And so, when you take out 20 percent of a student services unit, you're talking about some reductions in student services that Matt was worried about and talking about a little bit earlier. And so we can use the Tang Center as an example of that. The same would be true in the Career Center and Counseling Services, in terms of academic counseling, and other places. But just with the Health Services as an example, the impacts would include things like reductions in healthcare services in terms of positions, reductions in counseling in terms of the number of people who are there to provide services. The impact of that, of course, is that it will take a little bit longer for students to see a healthcare professional. It might take longer for a student in a non-emergency basis to see a psychologist.
Felde: I think that that is a question — students who need immediate health care, are they going to wait longer or will they be seen as they always have?
Mitchell: Yes, priority in the health services for both counseling and medical services is for those students who need urgent care. And so those students would be seen immediately. It is the discretionary or less-than-urgent students who come in who would be deferred for a period of time. But the priority is always on immediate care for those students who are in urgent need.
A couple of other impacts, in terms of the Health Service, would be that students will have to pay a little bit more for radiology services, or for labs and those kinds of services. As Matt was saying, that's unfortunate at a time when they're also paying more in terms of student fees. Again, you have the budget reduction of the sort that we just described, and there are no new resources to provide those services, that's what has to happen.
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Felde: And the next question is for Vice Chancellor Gray. Vice Chancellor
Gray, in keeping with the campus's mission to protect the core academic mission,
no faculty will be laid off. But are there effects that students are going
to see in the classroom? Are there classes that have been canceled? Are there
going to be fewer lecturers for sections, or fewer TAs for sections?
Gray: When the legislature passed the budget, contained in that legislation is a mandate that the cuts fall outside of the instructional programs of the university. So the $25 million of the permanent reduction that the campus has absorbed has to fall outside the instructional program. You heard Horace summarize some of the impacts of that.
When we first looked at the impact of all of that cut, if that had fallen suddenly in those areas, it would have been much worse than the impact that Horace talked about. So when we looked at the totality of this, the Chancellor decided that we should find a way to have a temporary, not permanent, reduction in the instructional units' budgets, that the deans could handle in creative ways (some of which I mentioned earlier) with the proviso that we would make that reduction temporary, and we would make it small enough that the changes in the instructional program would be minor and not have major impact on the student experience or progress toward their degree. But there are cases where low enrollment, upper-division classes might be only offered once a year instead of twice a year and not significantly affect progress toward a degree. That change can be made, and other examples like that, so there are some cases where students might not get a class and there might not be room in a class that they would like to have had and they might have to wait another semester. But we felt that was the right trade-off, because the academic part of the campus is two-thirds of the budget, and so a 5 percent temporary reduction there yields a lot of funds that can be used to soften the transition in the other parts of the campus services and in administration and so forth, to the new budget levels and will reduce what will be, I think, much more significant changes in the student experience in the services area.
So it really comes down to making the overall student experience, optimize it or minimize the impact overall and also minimizing the impact on the staff overall by making that temporary reduction in the instructional areas and trying to strike that balance.
Felde: If I may ask a follow-up question, are any of these cutbacks going
to have an impact on a student's progress to an undergraduate degree?
Berdahl: Let me take a stab at answering that, and Paul can join in this as well. Matt referred to the fact that a lot of students he talked to were having trouble getting into classes that they wanted — or in some cases, needed. We worked, as Paul has suggested, very hard at seeing to it that those major gateway courses are not reduced or eliminated, that is, the courses that are essential to the completion of a degree.
There are, every year, whether it's a good year or a bad year, students who don't always get the classes that they want. What we're trying to do now, and it's too early in the academic year to make this assessment, to assess what has been the impact on the availability of classes for students. Is it the case that what we hear about students not getting access to classes is simply the annual frustration when students feel shut out of classes, or is it worse this year? We need to assess that and I asked the folks in Student Affairs and Undergraduate Education this morning to undertake that kind of assessment. We certainly do not want to prolong the period of time that it takes students to reach their degrees. In the first place, that's bad for the campus because it means that we have more students on the campus than we can really accommodate at any given time. It would thus ultimately put restraints on our ability to admit new students if we could not have students graduating in a timely fashion. And certainly it's terribly unfair to the students to ask them to pay more and to pay more longer. So it's very essential, it seems to me, to work at this issue assiduously as we can.
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Felde: The next one, Chancellor, is for you. As you walk around campus, construction
is still going on. You see it in quite a few areas. So the question is, how
can the campus continue to build when the budget has been hit so hard?
Berdahl: Well, I think there's really two answers to that question, and one is that the campus ultimately can't continue to build when the budget has been hit so hard. Even those projects, those seismic retrofit projects that are funded by the state, have ancillary costs to them that are not funded by the state and that we have to absorb in our operating budget, and our capacity to absorb those costs is shrinking. We are really looking at pushing out, further into the future, many of those kinds of construction costs.
The second answer to that is that these funds are not fungible. The money that comes from the state for capital projects comes from bonds from the state, those are not available for operating expenses of any kind. That would be a violation of state law and misappropriation of funds. The other portion that goes into that are funds from private donors, so that we have projects like the large Stanley Hall project that is underway now that is a $162 million building, only $52 million of which comes from the state. The rest comes from private donors who have committed resources in support of that particular project. Those funds are not at our discretion to use in other ways. So if we were not to continue that construction, we would have to return the state funds to the state and the private funds to the donors. The answer is that you will see, ultimately, an impact on the construction on the campus because of the shortfall in state funds. But we hope that we can certainly continue as much as we're capable of doing, both from private resources and from our own because we have many projects under way that we don't want to stop. That would be disastrous for us and costly. So it will have, no doubt, an impact on our ability to continue construction.
Felde: To the final question, and this is for you, Vice Chancellor Mitchell.
There has been some criticism that the campus has not made enough use of the
START Program. This allows staff to voluntarily reduce their time and their
pay to keep salary costs down. How do you answer that criticism?
Mitchell: Actually, it's not surprising that the use of START has not reached the extent that was true of earlier programs. One reason for that is that if you think about the reduction that we took in the early and mid-'90s and the reductions and early retirements that occurred then, we have never actually regained the staff size that we had at that point. The general message during those days was, "Do more with less," and I think that's what's been happening over the last several years. At this point, with the addition of these reductions in staff, you're at a situation where many departments simply cannot afford to have other people working less than full time. So there are places where departments haven't agreed, which is one of the requirements for the START, have not agreed to have staff reduce their time.
Also, for some staff, there is some concern that if they were to reduce their
time, it would suggest that they weren't needed 100 percent and certainly they
would not want that impression to be there because it might suggest that they
be reduced in time on a permanent basis.
And finally, I think, another factor is that given the general downturn in the economy, there are many staff whose spouses or partners have been laid off from other jobs in the economy, so they simply can't afford to have a further reduction in their income under those circumstances.
Felde: All right. Thank you, and Chancellor Berdahl, it does look like we're out of time.
Berdahl: OK. Thank you, Marie and to all of you who've taken part in this by sending us your questions, we're very, very grateful. We'll continue to answer questions as they come in on the Web. We want everyone to feel fully informed about the budget circumstances that we face as a university as we possibly can. I'll be issuing more statements through the fall, and a state-of-the-university message to the campus because we want everyone to feel fully informed about what is happening on the campus.
I also want to thank my guests, Paul Gray, Horace Mitchell and student Regent Matt Murray. Thank you very much for being here.
I hope, in this special edition of Bear in Mind, that we've been able to shed
light on this very, very challenging time. As I've said before, there is so
much excellence, so much accomplishment, and so much support among the campus
community that I'm sure, working together, we will face up to this challenge
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