National Beat Reporter
The UC Board of Regents met at the University of California, San Francisco for its bimonthly meeting last week, where the members discussed at length the results of the state audit that reported $175 million of funds undisclosed by the Office of the President’s budget. They also deliberated their next moves as a board in order to improve the processes of financial transparency and budgeting policies.
On May 17, a variety of voices took the stage for the meeting’s public comment portion. Students, faculty, staff, and labor union representatives from across the ten campus system shared their concerns and frustration that arose from the state auditor’s report.
“I don’t understand why we had a proposed tuition increase in 2014, another in 2017, and then we find out that we have $175 million in a hidden reserve, whether or not this is supposed to go toward funding different programs for students you’re already under-resourcing,” said Taylor Chanes, the External Vice President of UC Irvine.
“In the past, [the] UC has justified rising tuition and housing costs and the exploitation of low-wage contract workers largely by citing a decrease in state support. Now we know that was simply misleading,” said Kathryn Lybarger, the President of AFSCME Local 3299, which is the largest employee union of the UC.
“Is this the tip of the iceberg?” Lybarger asked.
Antonio Ruiz worked as a parking attendant at UC Berkeley for 23 years and took the microphone last Wednesday to share his struggles as a contracted employee of the UC.
“As contract workers, we are at higher risk of wage theft and other violations,” said Ruiz. “Contract workers like me makes as low as 50 percent less than UC employees, so our families really hurt when violations happen.”
“Now, we heard that UC was hiding millions of dollars instead of taking care of the struggling workers and students. I feel deeply disrespected by UC to know that my family struggled for years when the UC lied.”
Tuesday’s meeting was also interrupted by fifteen minutes of chanting of, “Whose university? Our university!” among the audience, reaffirming the exasperated tension between the board and students, staff, and faculty alike.
UC President Janet Napolitano addressed the concerns outlined by the state audit and reiterated her and her staff’s dedication in complying with all of the auditor’s thirty-three recommendations in improving the UCOP’s budgeting procedures.
“We have important work ahead of us as we implement changes in response to the audit,” said Napolitano.
The following day, State Auditor Elaine Howle spoke before the Board of Regents, breaking down her office’s findings on the $175 million identified as surplus funds of the Office of the President.
According to the report, $83 million of those reporter funds had specific restrictions, deliberately allocated for certain purposes such as state grants. Approximately $92 million of the funds were described as “discretionary money,” where the Office of the President retained the autonomy to dictate where the money would go, without the discretion of the Board of Regents.
Of that $92 million, UCOP disclosed that $54 million had commitments for where the funds should be spent, such as system wide initiatives and programs. This leaves $38 million of funds uncommitted to any particular purpose.
“There should be an appropriate reserve, we don’t dispute that,” said Howle. “But what should that reserve amount be?”
The $175 million in funds examined by the audit were not described as “slush” or “hidden” funds in the report; they were described as “undisclosed funds” because the information and allocation of the funds are not disclosed to the Board, but ultimately decided upon by the Office of the President.
The main points that were discussed during Howle’s Q&A session with the Board was the importance of clarification and critique of procedures; the audit was not impugning on the integrity of Napolitano and her staff.
“This is not an audit of the President, this is an audit of the process of the Office of the President,” Howle clarified.
“I have great respect for [Napolitano],” said Howle. “I am not here to critique her leadership.”
The Board denied the adversarial impressions painted between the state auditor and the UCOP, blaming it on narrow-scoped reporting by the press.
Faculty representative Jim Chalfant’s remarks at the end of Tuesday’s discussion covered similar sentiments. Chalfant implored the board and the state to “dig deeper and learn more.”
“Simple narratives like, ‘UCOP hides $175 million — Cut their funding!’ and ‘nonresidents displace resident students’ make good headlines. But one of my favorite sayings has it, this isn’t right. It isn’t even wrong, it’s not the real story,” said Chalfant.
“The UC is the state’s third-largest employer and we enroll over 200,000 students — we cannot be reduced to a politician’s sound bytes,” said the faculty representative.
“I think what we have here is a failure to communicate, to quote an old movie,” said Regent Sherry Lansing.
“I think we need to build a closer relationship with the legislature. As [the] state auditor stated we have a clarity issue. To reiterate, there is no criminal activity, no slush finds, no hidden funds — nobody’s integrity is being questioned,” Lansing affirmed.
Regent Monica Lozano, chair of the board, described the auditor’s recommendations in larger terms.
“This is not about compliance by itself, this is actually changing the institutional culture of an organization,” Lozano said. “We need to step up our game as the fiduciaries of the university and we’re going to have higher expectations of the deliverables of those who manage the university.”