SUBJECT:  2001-02 Governor's Budget

For your information, the following is the official news release from the Office of the President regarding the 2001-02 Governor's Budget.

If you have any questions concerning this notice, please contact Dawn Buttrell at 534-3482.

                                                Margaret F. Pryatel
                                                Assistant Vice Chancellor

GOVERNOR'S BUDGET INVESTS IN AFFORDABLE, HIGH-QUALITY UC EDUCATION AND OTHER PROGRAMS SERVING THE STATE

Gov. Gray Davis proposed a 2001-02 state budget today (Jan. 10) that would fund the enrollment of 5,700 more students at the University of California, maintain affordable fees for students and their families, boost employee salaries, invest in UC initiatives benefiting the state and its economy, and maintain high-quality teaching, research and public service programs.

The budget provides the second phase of funding for the California Institutes for Science and Innovation and for a UC initiative to strengthen undergraduate education. It also expands support for graduate programs, provides new state support for summer instruction at three campuses and funds an expansion of student retention services.

"This is a budget that will allow the University of California to continue admitting all qualified students and providing them an education of the highest quality, while also focusing on the economic and social needs of California," said UC President Richard C. Atkinson. "We are grateful to the governor for his strong and consistent commitment to higher education."

The governor's budget fully funds the "partnership agreement" between the university and the Davis administration, which calls for predictable annual increases in state support for UC's basic operations along with UC accountability in certain areas of performance. The budget also commits funds to some additional UC initiatives, largely for one-time, high-priority purposes.

Under the governor's plan, UC's state-funded operating budget would rise 6.3 percent in 2001-02 to $3.4 billion. Highlights of the budget include:

* Funding for an additional 5,700 students in 2001-02, or enrollment growth of 3.5 percent, including 1,000 additional students in engineering and computer science and 500 in education credential programs to help meet California's workforce needs. Overall, the budget boosts graduate enrollments by 1,000 students; UC has initiated a multi-year effort to expand support for graduate education because the success of California's economy depends in part on the research and training provided by graduate programs.

* No increase in mandatory systemwide student fees, for the seventh consecutive year. These fees would remain at $3,429 for resident undergraduates and $3,609 for resident graduate academic students, excluding miscellaneous campus-based fees. Between 1998-99 and 1999-2000, systemwide fees actually decreased 10 percent for resident undergraduates and 5 percent for resident graduate academic students.

* State support for summer instruction, to be phased in first at UC Berkeley, UCLA and UC Santa Barbara. UC's plan is to add additional campuses in subsequent years. Historically, the state has not funded summer instruction at UC; this new funding will help the university accommodate student enrollment growth over the next decade.

* Funding for an average 2 percent employee salary increase, along with funding for merit increases for eligible employees. The budget would provide an additional $10 million to improve compensation for staff positions where pay levels currently lag the market. (Actual distribution of salary increases varies by compensation program and is subject to collective bargaining requirements.)

* An additional 1 percent increase for faculty, to keep their salaries competitive with those of UC's comparison institutions across the country.

* $75 million as the second of four installments of funding for the California Institutes for Science and Innovation, three cutting-edge research facilities selected by Gov. Davis last month following a peer-review process. The budget also proposes $33 million as the first of three installments of funding for a fourth institute, focusing on information technology.

* Funding to strengthen the undergraduate educational experience at UC by reducing class sizes, offering additional lower-division seminars, providing more undergraduate research opportunities and offering more academic advising, among other things. The budget adds $8 million to the $6 million provided in 2000-01 for this purpose.

* $3 million to expand student retention services including counseling and career guidance, tutoring, summer bridge and orientation programs, and services for students with disabilities.

* A $1.5 million increase for graduate and professional school outreach programs that encourage undergraduates to continue their studies, and a $1.1 million increase for an electronic information system (http://www.assist.org) aimed at transfer students.

* A $2 million permanent increase for research, and $4 million in one-time money for a genetic biomarker research project, at the M.I.N.D. Institute (Medical Investigation of Neurodevelopmental Disorders) at UC Davis.

* One-time funding of $13 million for research important to the state in engineering and computer science, environmental science, and integrated pest management, with at least $9 million of that amount to support graduate students in each of these areas; $18 million to expand student and faculty access to the new, faster Internet2; $20 million for deferred maintenance, instructional equipment and library materials; and $2 million to accelerate faculty hiring at UC Merced.

* A $203 million bond-funded capital budget for facilities projects at UC, and $160 million in general funds for construction of the first buildings and infrastructure at UC Merced.

The budget will be considered by the Legislature and revised by the governor in May, when new revenue forecasts become available. Final action on the budget generally occurs in June.