OFFICE OF THE ASSISTANT VICE CHANCELLOR
RESOURCE MANAGEMENT
August 4, 1995
ALL AT UCSD
SUBJECT: 1995-96 State Budget
For your information, the following is a press release regarding the 1995-96 State budget signed today by Governor Wilson and a statement by President Peltason on the University's State funding.
If you have any questions regarding this notice, please call Pamela Sanford at 534-3480.
Margaret F. Pryatel
Assistant Vice Chancellor
Attachment
****************************************************************** STATE BUDGET SIGNED, NO GENERAL FEE INCREASE THIS FALL
Gov. Pete Wilson today (Thursday, Aug. 3) signed a 1995-96 state budget which will mean no general fee increase this fall for University of California students -- the first time in nine years there will be no general fee hike.
"I am very pleased to express my thanks to the governor and the 
     legislature who, despite these difficult financial times, have given the 
     University of California a budget for next year that marks the beginning of
     our financial recovery," said UC President Jack W. Peltason. "Despite the 
     cuts we will need to make, the 1995-96 budget provides UC with more state 
     funds than the budget proposed in January. This budget is good news for the
     talented and hardworking faculty, students and staff of this university."
UC will receive $1.92 million in state general funds in 1995-96, an increase of 3.5 percent or $65 million over last year plus additional funds
to cover increased debt service for capital outlay and deferred maintenance. The increase in operating funds is $28.5 million more than proposed by Gov. Wilson in January and $77.4 million less than what had been sought originally by the university's Board of Regents.
The $28.5 million was added to UC's budget by the governor and the legislature to cover almost three-fourths of the $38 million that would have been generated by a proposed 10 percent or $380 general student fee increase. UC will have to cut an additional $9.5 million from its budget to make up the difference.
"There will be no general student fee increase in 1995-96," said Peltason. "We have already begun looking at our options for accommodating 
     the $9.5 million shortfall."
The average total fees for a California resident undergraduate will remain at about $4,111 including individual campus miscellaneous fees. That
is about $700 less than the average fees charged by the four public universities -- Illinois, Michigan, SUNY Buffalo and Virginia -- used by UC
for faculty salary comparisons.
The 1995-96 budget assures that students will continue to get the classes they need to graduate in four years or less and that the university
will continue to admit all eligible California high school graduates who wish to attend.
For all eligible employees, the budget includes funds for normal merit
increases. It also includes funding equivalent to salary range adjustments
of 1.5 percent for all employees and an additional 1.5 percent equity adjustment for faculty effective Oct. 1.
"Although faculty salaries will still lag about 7.5 percent behind our
     comparison institutions, we will at least not lose ground this year, and 
     under the governor's compact we will be able to close the competitive gap 
     over the next three years," Peltason said.
The governor's compact with higher education anticipates state General
Fund budget increases averaging 4 percent per year for UC and California State University over the next three years. It also anticipates student fee increases averaging about 10 percent per year over the same period.
In addition to identifying $9.5 million in savings to offset the shortfall related to the fee buyout, the university in 1995-96 is committed
to $10 million in permanent budget cuts and $13.3 million in temporary budget cuts through delays in filling positions and postponing the purchases of equipment and supplies.
While there will be no general fee increase, Regents previously had approved increases in fees for students entering certain professional school programs. The increases are part of a plan instituted by the Regents last year to gradually increase professional school fees for entering students in medicine, law, business, dentistry and veterinary medicine until they approximate the average of fees charged for those programs at comparable institutions. Entering medical, dentistry and veterinary medicine students this fall will pay an additional $1,000. Law students and business students except for those entering at Riverside will pay an additional $2,000. Riverside business students will pay an extra $1,000. Students already enrolled in those programs will not pay the additional fee.
The governor and legislature also provided UC with a $161 million capital budget for 1995-96, which will be devoted in large part to seismic and safety improvement projects.
---------------------------------------------------------------------------
August 3, 1995
MEMBERS OF THE UNIVERSITY COMMUNITY
Dear Colleagues:
The Governor and the Legislature have now reached agreement on a 1995-96 budget for the State of California. I am very pleased to express my thanks
to the Governor and the Legislature who, despite these difficult financial times, have given the University a budget for next year that marks the beginning of our financial recovery.
For all eligible employees, the budget includes funds for normal merit increases. It also includes funding equivalent to salary range adjustments
of 1.5 percent for all employees and an additional 1.5 percent equity adjustment for faculty, effective October 1. Although faculty salaries will still lag about 7.5 percent behind our comparison institutions, we will at least not lose ground this year, and under the Governor's compact we will be able to close the competitive gap over the next three years.
The Governor's compact with higher education, intended to provide fiscal stability after a period of steep and sudden budgetary losses, anticipates General Fund budget increases averaging 4 percent per year over the next three years, and student fee increases averaging about 10 percent per year over the same period, with a third of the revenue set aside for financial aid. It will permit us, as I have said, to restore competitive faculty salaries over the next few years and to continue admitting all eligible students under the Master Plan.
The 1995-96 budget provides a 3.5 percent increase in operating funds for the University, plus an additional amount for increased debt service for capital outlay and deferred maintenance, and $161 million for capital outlay. There will be no general student fee increase in 1995-96. Fee increases already approved by The Regents for students in selected professional schools will be implemented, however.
While the Legislature generally approved the elements of the Governor's compact for 1995-96, there was one significant change. Controversy over the proposed $380 student fee increase was finally resolved by an agreement
under which the University will receive an additional $28.5 million of State funds. This leaves the University $9.5 million short of the full amount needed to fund our budget plan, and we have already begun looking at
options for accommodating this shortfall.
Despite the cuts we will need to make, the 1995-96 budget provides the University with more State funds than the budget proposed in January. This
budget is good news for the talented and hardworking faculty, students, and
staff of this university, and I wanted to let you know immediately. Thank you for all you contribute to the University of California.
Cordially,
J. W. Peltason