The end of furloughs

UC furloughs end today, not a minute too soon. Paychecks will return to "normal" as of October 1.

Furloughs were  a bad idea to begin with (achieving savings of about 200 million, or 1% of UC's overall budget), the majority of employees (those not paid out of the general fund) were exempted from them, thereby creating a group of second class employees bearing the brunt of the cuts, and were hugely unpopular.

In addition to being a bad idea, the furloughs were badly executed. All will remember the infamous "Pitts memo," dictating that — contrary to the preferences of a majority of the faculty — furloughs were not to be taken on instructional days. Not being able to take furloughs on teaching days meant the furloughs were really just as straight pay cut, as faculty do not stop doing research on furlough days. The apparent reason for Pitt's edict was "bad optics:" it would have looked bad with the governor, the legislature and the public at large (a concern that apparently Cal State did not share).

Funny how there is no consideration of bad optics when it comes to extravagant executive compensation, $700,000 in housing expenses for the UC President (in just two years), or the "restoration" of retirement benefits for senior management at the same time as UC plans to cut those benefits for everyone else.

Even on the numbers there was never any clarity. It took the University a long time to admit that the furlough program would result in savings far greater than the advertised $200 million (about $500 million), with the extra savings to remain with the units that generated them (a clearly obfuscatory formula). 

So, good riddance to the furloughs, as we brace for the next bright idea to come out of UCOP.

Furloughs 2010-11

As is well known, Pres. Yudof has committed to ending the furlough program this summer. Now, of course, that is a proposition that raises more questions than it answers, and here is why. UCOP must be fully aware that things are not going to be significantly better next year: although the Governor's January budget allows for a somewhat larger appropriation for UC next year than this year, this will be more than offset by the loss of federal stimulus funds. And this is predicated on the very unlikely assumption that the May revise will resemble the January proposal in this respect, which is furthermore conditional upon the federal government's pitching in a few billions here and there.

So UCOP would seem to have two options, neither one of which is good. If they fail to follow through on the commitment, then their credibility is shot to smithereens (even more than it is now). If they do follow through, that raises the obvious question of why furloughs were necessary this year in the first place, and again this exposes a certain level of duplicity. So what gives? Is it possible that our fearless leaders in Oakland have not actually thought this through? 

There is, however, a third option. It all depends on what you mean by "UCOP ending the furloughs." It would appear that (given the heat UCOP is taking on the furloughs) their plan is to pass the buck to the campuses, by imposing a certain savings target, and allowing the campuses to handle this as they see fit.

I would expect some campuses (UCB and UCLA, say) to find enough funds in their budgets to end the furloughs, while other, less endowment-rich campuses, would have no choice but to continue the furloughs.

Just a thought, we'll see what happens. In the meantime, let's see how this March 4 events turn out.

$3.1M in incentive pay at UCMCs

During their their meeting this week in San Francisco, the Regents are expected to approve $3.1M in incentive pay for 38 senior medical center managers. That's an average of $81,600 for each manager, with David Feinberg, head of UCLA's Medical Center, earning close to $220,000 in incentive pay alone.

UCSF Chancellor Susan Desmond-Hellmann said her hospital saw a more than 5 percent drop in one type of infection, and that 89.5 percent of patients surveyed reported being satisfied with care. "This is how you run a great medical center," she said, referring to incentives.

The $3.1M do not come from state funds, but from medical center profits. According to the SF Chonicle,  the University would likely be sued if they did not approve the incentive pay (as such incentives were in the managers' appointment letters).

This raises a couple of questions:

1. The MCs are turning out millions in profits, should they not be asked to help support the University at large, the same way in which the University at large supports them?
2. There are many faculty and perhaps staff whose salary is specified in their letters of appointment or promotion. Why does the furlough program not expose the University to potential lawsuits from these faculty and staff?
3. And, since we are at it, why not extend the incentive program across the board? Here is a deal: if 89.5% of my students are satisfied with my teaching and I increase their test scores by 5%, I propose that the University  award me the average incentive of $81,600.

Senior managment explosion

According to a study by the Council of California Faculty Associations, the University of California has been engaged in a veritable hiring spree when it comes to senior management, to the point that there are now almost as many senior managers at UC as faculty members.

There were 2.5 faculty member for each senior manager at UC in 1993, today it's virtually one to one. If the 2.5 ratio had been enforced, UC would save about $800M — which is, by coincidence, the very same amount of the current budget shortfall over last year.

It would seem irresponsible to furlough and lay off people often making a fraction of what senior manager make — the janitorial and service staff, the lecturers and other temporary faculty as well as many of the regular faculty  — the people who make the university run — when there is such a glut at the managerial feeding trough. It is also worth mentioning that while there might be some doubt as to whether UC uses student fees to pay for debt service on construction bonds, executive salaries unquestionably come out of core funds.

Student coalition calls for system-wide strike

A student coalition is calling for a system-wide strike to be held Nov.18-20, concomitantly with the Regents' meeting where the proposed fee increases for next year will be considered.

The students demand:

• that the Regents vote no on the proposed fee increases.
  

• that the UC stop cuts and layoffs, and end its aggressive union-busting tactics.
  

• transparency of the UC budget, including complete figures on how much of the additional revenue from fees will be diverted for construction and used as bond collateral.
  

• that the Regents expand enrollment of underrepresented groups and ensure equal access to education for all.
  

• an explanation for the failure of the UC leadership to make an effective case for public higher education.
  

These seem all pretty much on track to me.

California's budget hole widening

It was clear already this past July that the nasty and brutal budget deal reached by the Governor and the Legislature would not probably be enough. We now learn from Bloomberg that the State's revenues are already running $1.1B behind expectations in the 3 months June 30 to Sept. 30, the decline being driven by smaller-than-expected returns in sale taxes, which in turn are driven by the 12.2% unemployment rate and certainly not helped by furloughs and layoffs of state workers.

The Bloomberg article also makes clear how much of the current budgetary trouble derives from servicing debt uncurred by the State under Schwarzenegger in trying to balance previous budgets. In addition to old debt, the July budget deal allows the sale of an extra $11B in bonds, "if the market allows," i.e., if the state does not have to commit to extravagantly high rates to force its bonds down investors' throats.

All of this spells trouble for the prospect of higher ed in California. At UC, we have a "soft" promise from UCOP to end of furloughs in 2010-11, but we have already had calls for an extensions (to mitigate fee increases), and the current budgetary stars do not seem to be aligned the right way.

As a counterpoint, in a recent NYT piece, Paul Krugman points out the elementary fact that in an economic downturn public support of education serves the dual purpose of providing counter-cyclical employment opportunities and delaying entry in a dismal job market for high-school (and college) graduates. California is, of course, doing exactly the opposite of what it should be doing.

LA Times advocates extending furloughs into 2010-11

In an unsigned editorial, the LA Times laments the effects of the proposed fee hike on UC students and their families. The University runs the risk of losing the best middle-class students to private institutions offering more and more purely merit-based financial aid (which benefits the middle class), especially at a time when UC fees are within sight of tuition at private colleges and universities. It is true that a large part of the fee increase is slated for return-to-aid, but that only exacerbates the fact that middle class students are "taxed" in favor of lower-income families.

As one of the measures the LA Times proposes to address the situation, the Board of Regents

should closely examine Yudof's desire to end work furloughs after this academic year. We understand that most UC faculty work for modest salaries and can ill afford pay cuts, but we also are not convinced that they would leave in droves if furloughs of a few days a year were extended into 2010-11.

It's difficult to enumerate the ways in which this just a stupid idea. But one leaps to the front, namely the odd logic of the claim that economic pressure would lead the "best and the brightest" among UC students to move to private institutions, but not — inexplicably — the best and the brightest among the UC faculty. (By comparison, look at this also unsigned, but more constructive piece by the SF Chronicle.)

It might be true that faculty would not leave "in droves," but the most respected faculty most certainly would — those who bring in much needed research grants and those who can boost a program's rankings with their teaching, service and research.

It is true that the middle class is getting a raw deal, but the answer is not to pit the faculty against the students, or lower-income families against middle-class students. The only way to save the University of California is through politcal action to change the State's funding process and priorities. It takes a lot of effort to build up excellence, but only a little to destroy it.

Yudof's address to the Regents

The UC Regents met yesterday, Sept. 16, to discuss the proposed increase in fees for undergraduate students at the University. After a bit of bru-ha-ha, the meeting could get down to business, beginning with Yudof's address to the Regents (the videos can be found here, here and here).

This was a passionate plea by Yudof to the Regents, and again one that is worth a close look for the information it provides on the direction where the University is headed. Yudof began by painting a rather bleak picture: the worst is far from over, the state budget will not improve next year, federal stimulus money will go away, all the while the university has to deal with an "unreliable partner," viz., a "dysfunctional state government."

Having thus described the situation, Yudof then proceeded to articulate his argument, whose first premise is that we shold give up "faith-based budgeting," i.e., coping with the present situation hoping that things will get better. Things will not get better, the State will not provide more money for the University (for a number of complex but well known reasons). We have to face the "unhappy truths;" we can, and should go to Sacramento for more money, but we should be aware that the State has no more money to give.

The second premise of Yudof's argument is that "mediocrity is the greatest enemy of the UC." We must do everything we can to preserve quality. From these two premises it follows that we must increase our reliance on the only other source of revenue that is available to the University, and increase student fees. Students must realize that the State "stopped building freeways to higher education" and is now "building toll-roads."

This is the main argument. Are there alternative solutions? Yudof does not think so: he denied that there were administrative raises, denied that there were "unrestricted" or "reserve" funds in the budget (and even if there were, say at the Medical Centers — and he's not saying there are —it would "wrong" and perhaps "illegal" to use them), blamed the union's (and especially AFSCME's) unwillingness to negotiate for the layoffs.

The fee increases are necassary, according to Yudof, in order to "stop the decline of the academic program" at the University, prevent a brain drain at the UC, and "do away with the furloughs" as of next summer (a connection that has the added benefit. obviously, to divide the faculty and the students).

Pres. Yudof ended reminding the Regents of the Blue and Gold Program, allowing any student whose family earns less than $60K to attend UC for free, the fact that 30% of the increase returns to aid, and the very high proportion of student on Pell Grants, the highest of any research university.

Yudof's vision is clear and, if we accept the two main premises of his argument, his plan is rational and compelling. The details of his plan have, of course, been poorly executed, but that is a different story. The Pitts memos, for instance, were blunders of historic proportions: if UCOP had received the Senate's recommendations we would not probably be here considering an unprecedented faculty walkout on the first day of classes, and in fact nobody would be surprised if Larry Pitts were at some point scapegoated for this. The administrative raises, that were (contrary to Yudof's claims) real and documented, were very bad optics, even if inconsequential in the $20B budget of the University. And the decision to protect the revenue-generating units at UC, first and foremost the five Medical Centers, even it meant gutting the core campuses, could have probably been avoided or mitigated. But these are matters that concerns the implementation of plan, not the plan itself.

Yudof has been criticized as a "privitazer," but his views is not to turn UC into a private university, but into a true hybrid institution. As pointed out elsewhere on this blog, there are reasons to think that that goal might not be attainable, as hybrid istitutions are inherently unstable, but that is Yudof's vision. We can either accept that vision or reject at least one of Yudof's premises. Since preservation of quality at UC is a goal that we share, the only option on the table is to engage in political action to make sure that the State's priorities are reversed and its funding model radically altered. Not easy, but is there another way?

UCSA endorses Sept. 24 walkout

UCSA, the University of California Students Associations, which represents over 200,000 students in the UC system,  unanimously endorsed the Sept. 24 walkout.

This is particularly important since one of the arguments against the walkout is that it would impact the students, who would show up to empty classrooms on the first day of the quarter. The UC Davis Provost/EVC even allocated funds to make sure that this would not happen (supposedly to hire faculty replacements — am I the only one who finds this appalling?).

This argument is now pre-empted. It's important that faculty and students stand together, on the 24th or any other day, for "the continued defense of the future of public education in California."

The second Pitts memo

UC Provost Lawrence Pitts has issued an "open letter" to the faculty, supposedly to explain the reasons behind the first Pitts memo.  As one can imagine, we approached the open letter with some trepidation, given that the original memo did not address any of the reasons behind such a divisive choice, and also because of the tantalizing tidbit found in the Powell-Simmons letter to the AAUP.

Needless to say, we were disappointed. The second Pitts memo only rehearses the argument that furloughs should not be taken on instructional days "because of the additional hardship it potentially would cause for our students."

In the meantime, UC Davis Provost/EVC Lavernia has announced in a letter to the Chairs that he is "prepared to provide departments with temporary support funds" to make sure that "students do not show up to an empty classroom."

Oh? Who knew that there was extra money floating around the University?

Academic Senate to AUUP: long live the Great Helmsman!

Chris Newfield just made available a letter that the new system-wide Academic Senate Chair Powell and Vice Chair Simmons have written to the AAUP (who had endorsed the proposed Sept 24 walkout). In their letter, Powell and Simmons claim that shared governance is alive and well at the University of California, and whoever thinks otherwise does not really understand what shared governance means. As my children would say: whatever.

Almost lost in the perfunctory mumbo-jumbo, though, is this pearl:

[Yudof] has indicated that the decision was necessary as part of his effort to insure that the faculty furloughs will not be continued into a second year. 

Oh? We are surprised, first of all, because there no such motivation in the now (in)famous Pitts memo, where UCOP was mostly concerned in laying down the law. But, second, the connection between the implementation of the furloughs and their continuation into a second year is one that UCOP has never bothered explaining to the faculty. This would, of course, be completely in keeping with the culture of secrecy and lack of budgetary transparency at UCOP, but another explanation is possible: there is no such discernible connection, and Powell and Simmons are just engaging in cognitive dissonance and  post factum rationalization.

Unit 18 lecturers not participating in furloughs

As reported by Bob Samuels:

The UC Office of the President has informed UC-AFT that Unit 18 lecturers will not be participating in the furlough plan.

This is probably not good news for the lecturers. Looks like UCOP is trying to achieve salary savings more directly through layoffs. Lecturers with less than 18 quarters of service (so-called "pre-6" lecturers) have very little protection under the contract, and can be laid off with little or no notice, but post-6 lecturers need a 12-month notice before they can be laid off. That's why 67 UCLA lecturers in Humanities and Social Sciences were all given letters to the effect that their contracts will not be renewed as of next summer. This was presented as a precautionary measure that the Administration had little intention to follow through —we are not so sure any more — now that the Administration can achieve salary savings and bust a union at the same time.

UCSDMC cuts $24M - without furloughs

In confirmation that UC's medical Centers will be spared employee furloughs, KPBS reports today that UCSD Medical Center implemented $24 in savings without furloughs or other salary cuts. The savings were achieved

by limiting overtime and not filling vacant positions ... many travel expenses [have been eliminated], and there have been some layoffs.

The layoffs are obviously bad news, but a great number of units across UC have had to deal with furlough and take the layoffs. More in general, this is another sign of the white-glove treatment received by revenue-generating units at UC (and also an implementation of UCOP's divide et impera policy). 

AAUP supports UC faculty collective action

In today's letter to UC faculty, the AAUP supports "calls for collective action — most recently a system-wide walkout of all UC faculty," pointing out that such collective action is direct consequence of UCOP's rejection (via the Pitts memo) of the Academic Senate recommendations. Here are some highlights:

The rejection of the faculty’s unanimous voice about implementing furloughs, through a vote of the Academic Council on July 29, 2009, is at best unwise and at worst dismissive of a cornerstone of the UC system’s strength, its faculty...

The principles of the American Association of University Professors hold that the managerial assertion of financial emergency powers does not justify failing to incorporate the full and meaningful participation of faculty in shared governance ...

For too many years university presidents have accepted and preached the pattern of public disinvestment as inevitable, advanced the privatization of public universities, and suggested that we can do more and more with less and less. By their actions, university presidents have advanced a model of academic capitalism that has compromised educational quality, and now that model is collapsing financially.

Collective action being considered at UC, in the form of walk-outs or teach-ins, is necessary to send a clear signal that cuts to the University are not painless and have consequences, the model of the university-as-factory nothwithsatnding. 

Show me the money

A document released by UCOP last Friday addresses Employees' Frequently Asked Question on the furlough program. After going through many details concerning the implementation of furloughs, UCOP finally addresses the question:

I’ve read that the furlough plan yields much more than $184 million. Please Clarify.

And, surprisingly, the answer is a stunning vindication of what has been argued on University Probe for almost two months:

Yes, savings from the furlough plan will total more than $184 million. When all UC funds sources are taken into account (UC general funds, auxiliary enterprises, contracts and grants and medical center revenues) the furlough plan yields approximately $515 million.

So the furlough plan will generate $330M in excess of the advertised $184M in general fund savings. So, what does UCOP plan to do with that windfall? Read on:

The additional dollars resulting from the salary reductions in other non-general fund sources will be used to help offset other cost increases and revenue shortfalls in those areas, such as rising costs of technology, utilities and health benefits as well as revenue shortfalls such as cuts in Medi-Cal payments to UC medical centers. To the greatest extent possible, campuses will seek to deploy savings generated from non-general fund sources strategically to address their specific needs and to address the balance of the $813 million state funding shortfall after savings from furloughs/salary reductions are taken into account, consistent with any restrictions on those fund sources.

So, let's see. The State cuts general funds appropriations to the UC by $813M; UCOP announces that 25% of that — the famous $200M — will be taken in salary reductions throught the furlough program, and the remaining $600M and change divided among the campuses to make up through other cuts in their operating budgets. But now it turns out that those were not the actual numbers: $515M will be generated through the furlough program, and the remaining $298M  divided among the ten campuses.

In addition, the campuses will absorb other increased costs (cuts in Medi-Cal payments, rising utilities and benefits costs, etc.). So here is the question: if that was the plan all along, why go through the $200M rigmarole? Just tell UC facuty and staff that they will absorb the bulk of the general fund cuts. But of course that might have appeared — unfair ?

And of course, no figures are available as to what decreased Medi-Cal payments to the medical centers will cost the UC, or what the increased utility and benefits costs will turn out to be.

It would seem that UCOP is out to protect medical centers and other revenue generating operations, and if they have to do this on the backs of faculty and staff across campus, then so be it.

UCSB, UCSC divisions speak up against furloughs

Two strongly worded letters from Santa Barbara and Santa Cruz divisional chairs take exception with the furloughs and their implementation, especially as regards the now (in)famous Pitts memo. The SB letter can be found here (thanks to Chris's Blog Archives for posting it), and the SC letter is here.

Especially the SC letter is impressive for the way the argument for furloughs and their implementation on non-instructional days is dismantled, under four distinct headings:

1. Incoherence of UCOP’s view of our Systemwide mission;
2. UCOP’s Inability to Follow [its own] Guidelines;
3. Institution of Tiering of Salary and Effort by Discipline;
4. UCOP’s Messaging, or Lack Thereof.

It is a great read altogether. Hats off to the SC division for speaking up!

No furloughs on teaching days

According to a letter from Lawrence H. Pitts, Interim Provost and Executive Vice President Academic Affairs, furlough days are not to be taken on teaching days. This in spite a wide consensus among the faculty throughout the System that at least some furlough days were to be taken on instructional days, including an official position letter by the Systemwide Senate. Anybody else out there who finds this outrageous?