Capitol Alert

California budget deal seeks nonresident enrollment cap at UC

Out-of-state Berkeley student explains enrollment debate

UC Berkeley sophomore Aarti Jaggi, a materials science and engineering student from Houston, said her friends sometimes debate whether Californians or nonresidents have a more difficult time getting into the university.
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UC Berkeley sophomore Aarti Jaggi, a materials science and engineering student from Houston, said her friends sometimes debate whether Californians or nonresidents have a more difficult time getting into the university.

After a scathing state audit this spring reignited controversy over the rapid growth of nonresident enrollment at the University of California, Gov. Jerry Brown has drawn a line in the sand – albeit a soft one – on the issue.

A budget deal with lawmakers released Thursday night would offer the university an $18.5 million funding incentive, to kick in next May, if it enrolls an additional 2,500 Californians for the 2017-18 school year and adopts a policy capping the number of out-of-state and international students. The budget does not specify a cap, allowing UC’s governing Board of Regents, of which Brown is a member, to set its own terms.

Legislators are simultaneously pursuing a bill that would limit nonresident enrollment to 10 percent of undergraduates by 2022, well below the current level of 15.5 percent. It passed the Assembly last week and will advance to the Senate for consideration.

H.D. Palmer, spokesman for Brown’s Department of Finance, said Brown expects the regents “will respond to the clear interest on the part of state leaders” to restrict the number of out-of-state and international students at UC.

“He believes it’s a step that’s consistent with steps taken by UC and the regents in the past,” said Palmer, pointing to a 2010 report adopted by the board that recommended a nonresident enrollment cap of 10 percent. “He looks forward to having a discussion with his fellow regents on what an appropriate level would be.”

UC has come under increasing fire in recent years for recruiting higher-paying nonresident applicants, who now make up more than 20 percent of undergraduates at some of its campuses. The university defends the practice as a necessity to make up for steep budget cuts it suffered during the recession, but critics fret that qualified California high schoolers have been shut out as a result, a charge UC vehemently denies.

An effort by lawmakers to also include a requirement in the budget raising admissions standards for nonresidents was not successful. Among the state audit’s more contentious findings was that a change to its guidelines in 2011 led UC to accept thousands of out-of-state applicants with lower grade-point averages and test scores than their California counterparts.

With some political prompting, the university is already on track to enroll 10,000 more Californians – and 3,000 more nonresidents – at its nine undergraduate campuses over the next three years. In a plan adopted last November, UC will add another 5,000 resident freshmen and transfers this fall, good enough for a $25 million bonus from the state, then an additional 2,500 slots in the 2017-18 and 2018-19 academic years.

In a statement, UC spokesman Steve Montiel lauded the budget deal for providing “critical new funding for important UC priorities” and said the university “looks forward to working with the Legislature and the Governor on continuing to grow California enrollment and keeping tuition as low as possible.”

“To be clear: The enrollment growth funding is contingent on the UC Board of Regents adopting a policy regarding nonresident undergraduate enrollment,” he added. “The agreement does not dictate what form that policy must take.”

The budget deal will also require UC and California State University to review their policies on outside activities by executives and senior management, including making changes to ensure they do not create conflicts of interest or commitment, are properly approved, are reported publicly on an annual basis and are consistent with the public mission of the universities.

UC Davis Chancellor Linda P.B. Katehi kicked off a furor this spring when she accepted a board position with the for-profit DeVry Education Group without getting proper permission from UC President Janet Napolitano. Calls for her resignation dogged her through further revelations about her three years on the board of a textbook company and efforts to bury references to the campus’s 2011 pepper-spray incident. She is now under administrative investigation.

Another investigation by The Sacramento Bee found that CSU officials could avoid disclosing personal financial details because of how the university policy was written.

Other new components of the higher education budget include a requirement for UC to enroll more students from predominantly low-income and minority high schools in California and $5 million to establish a gun violence research center. CSU will receive another $12.5 million to add 5,200 slots next year and a one-time appropriation of $35 million to raise graduation rates, which hover above 50 percent in six years and below 20 percent in four years for first-time freshmen. A $15 million “California Promise” program will provide grants to community colleges to boost local college readiness and degree attainment.

But several more critical proposals from lawmakers targeting UC were left out of the final deal, including an Assembly recommendation to give the state auditor’s office $1.1 million to annually audit the university’s budget. A deep dive into UC’s spending last year by the Assembly uncovered several items, such as financial aid for nonresidents, that infuriated legislators and further inflamed tensions during an ongoing budget battle.

Another rejected Assembly suggestion would have reversed a deal between the governor and UC to create a new tier for the university’s underfunded pension system. The move was sought by employees unions who argued that shifting the retirement plan away from guaranteed benefits would undermine its stability.

Last year’s budget deal with Gov. Jerry Brown included a cap on UC faculty and staff pensions that will match that of other state workers. Some are protesting, but UC President Janet Napolitano says it won’t be so bad.

Alexei Koseff: 916-321-5236, @akoseff