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Texas and California are natural rivals when it comes to everything from their culture and influence to their economies. But when it comes to the two states’ vaunted public university systems, the Lone Star State may have a better handle on a major concern in higher education over the last decade: costs and tuition.
A look at how UC compared in the last decade to the University of Texas system found overall spending at the Golden State’s coveted university system grew significantly faster than it did in Texas, according to a Bay Area News Group analysis.
Moreover, although student enrollment grew at identical rates and staffing growth was similar in both university systems, undergraduate tuition and related fees grew far more at UC over the last decade and are a third higher than at the University of Texas.
The findings raise questions about spending patterns at the University of California, where tuition has climbed sharply over the last decade, prompting protests from students and demands from state leaders for more efficiency.
A comparison of figures for both university systems from 2008 to 2018 shows:
- Overall budgeted spending grew 80 percent at UC, from $19.2 billion to $34.5 billion, compared with 70 percent at the University of Texas, from $11.5 billion to $19.5 billion.
- Undergraduate annual resident tuition and fees grew 86 percent at UC, from $7,517 to $13,964, compared with 50 percent at the University of Texas, from $6,298 to $9,444.
- Enrollment grew 23 percent at both university systems. Staffing rose 20 percent at UC to 227,786 and 26 percent at the University of Texas to 83,676.
- Excluding this year’s increases, state funding for UC was down slightly, 1.8 percent, over the last decade, but rose modestly by 4.7 percent at the University of Texas.
- Pay and benefits costs grew 76 percent at UC, to $21.8 billion, outpacing the 62 percent rise at the University of Texas to $10.7 billion.
UC officials said after reviewing the Bay Area News Group’s analysis that “there are several complex reasons for the discrepancies between the university systems, including differences in structure and missions, growth in health care spending, cost of living and pension liabilities.”
UC has more of the highest-level research institutions than Texas, and that “makes for a very different set of spending priorities across all 10 campuses,” said Amy Weitz, a UC spokeswoman. And while both university systems operate medical centers, she said that staffing at the UC Health system “has grown rapidly” and “is a major cost-growth driver.”
Overall, UC officials said pay and benefit costs, in part driven by the high cost of living in the Golden State, account for much of the difference in spending.
“Wages have increased significantly more in California than they have in Texas, meaning that UC has needed to keep up to stay competitive and recruit and retain talent,” Weitz said, adding that a “significant factor” in UC’s pay and benefits growth is the cost of its retiree pension plan.
UC and its employees in 2010 began making payments into the UC Retirement Plan following a nearly 20-year “holiday” after investment losses in the last recession and flawed assumptions of costs left the plan short of funds to pay promised benefits. The UC system will spend $1.34 billion this year to cover pension liabilities. Weitz, who has since left UC at the end of last month, said that with pension costs factored out, UC pay and benefit growth would be close to the rate at the University of Texas.
A February report by the Legislative Analyst’s Office said average UC professor salaries are about $180,000 a year. That’s lower than salaries at select private universities like Stanford and Harvard, but it’s “notably higher” than those among 77 other public high-level research institutions surveyed across the country. Retirement benefits are based on salary.
Still, UC’s top campus officials’ six-figure salaries are less than those of other public and private universities. UC Berkeley’s chancellor earned $531,939 in pay and benefits compared with the University of Texas at Austin’s top official who earned $761,750, according to a recent UC survey.
Student leaders have been frustrated for years by the growing costs of attending UC, not just for tuition but housing and other needs. They feel caught between UC and state officials turning to tuition hikes to cover growing costs.
“Tuition at UC is already too high,” said UC San Diego student Caroline Siegel-Singh, president of the University of California Student Association.
“Every year, UC insists that tuition increases are necessary to sustain its budget unless the state increases its investment to the university,” she said, while “the overall trend” over the past decade “was one of state disinvestment.”
Resident tuition and fees rose sharply during the last recession to offset reductions in state funding during those years but have remained essentially flat since 2012 despite threatened hikes. Non-resident students, however, saw a fifth straight tuition increase approved this year, bringing their tuition and fees to $42,324, more than three times what resident students pay. Lawmakers have demanded non-resident enrollment caps to avoid crowding out resident students.
Gov. Gavin Newsom’s budget includes a $240 million annual increase to fund UC operating costs plus an additional $138 million for a backlog of maintenance and $15 million for expanded degree completion and certification programs at UC extension centers.
The funding, he said, comes “with the expectation that tuition will remain flat, access will be increased” and that UC will “begin an in-depth conversation” on goals and expectations. Those include cost efficiency, fiscal certainty for students and their families, and increasing access to UC.
Newsom, who as former lieutenant governor served as a UC regent, and former Gov. Jerry Brown have been sharply critical of UC spending. A 2017 audit that said UC President Janet Napolitano’s office hid tens of millions of dollars in reserves and created a secret spending plan while padding pay and benefits of her staff did little to foster their trust.
UC officials noted that financial aid covers all systemwide tuition and fees for California students with family incomes of $80,000 or less. With that, 57 percent of California undergraduates pay no tuition and an additional 20 percent have part of their costs covered by financial aid.
Financial aid covers significant amounts of tuition and fees at other public universities too, including the University of Texas, where financial aid fully covers tuition and fees for students from families making less than $60,000 a year and 90 percent for those earning $60,000 to $80,000.
Siegel-Singh said it isn’t just tuition that burdens UC students. The high cost of living makes attending UC unaffordable for many in California. And she called UC’s “high fee-high aid” model of covering costs “unstable and unsustainable.”
“If a student sees that the cost of a UC is tens of thousands of dollars,” she said, “they may choose against pursuing a UC education.”
