University of California President Janet Napolitano said a tuition increase approved earlier this year would go through, despite calls from politicians to eliminate it in light of a state audit that claimed the UC Office of the President failed to disclose millions of dollars in reserve funds.
During a conference call with reporters from UC campuses’ student newspapers Friday, Napolitano also disputed the audit’s assertion that the UCOP had $175 million in reserve.
“Frankly, there’s a real difference between tuition dollars, which are ongoing permanent funds, versus one-year savings that are allocated for other initiatives, or are restricted funds,” Napolitano said. “It’s like comparing apples to oranges to mix the two.”
Napolitano said $83 million of the reserve funds are restricted toward administering national labs, research grants and wholesale funds program. She added $49 million has been allocated to a variety of systemwide and presidential initiatives, such as support for undocumented students, investment in carbon neutrality and efforts to combat sexual violence and sexual assault on its campuses.
Napolitano added UCOP has disclosed all these efforts to the regents and the press, and the remaining $38 million held in reserve, or about 10 percent of the core operating budget at UCOP, is a normal amount to hold in reserve.
“We think that is a prudent reserve, given contingencies and emergent circumstances that can arise between the time our annual budget is reviewed and approved by regents,” Napolitano said.
She said the office agreed to comply with the audit’s request that UCOP establish a written reserve policy.
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Napolitano also said the California State University system and UC differ greatly in terms of size, scale and complexity, to address criticism from the state audit that said some UC employees had higher salaries than state employees with similar responsibilities.
“For example, the (chief financial officer) of CSU manages about $6 billion, but the CFO at UC manages more than $31 billion,” Napolitano said. “UC also manages its own pension system and investments, while CSU is a member of (the California Public Employees’ Retirement System). Getting a real apples-to-apples comparisons within the state is not as easy as it appears.”
Napolitano also heads the decision-making process for presidential initiatives, she said. She added she and other UCOP staff seek input from campus administrators and their decisions are reported to the regents through budget documents.
The UC Board of Regents and UCOP accepted all of the recommendations the state auditor made, except for one in which the state legislature would directly appropriate funding for UCOP, rather than the UC Board of Regents or campuses, she added.