SAN RAFAEL – Tuition at University of California’s nine public schools -- including its law schools -- increased roughly 15,000 percent during the last 35 years, and a retired board regent is speaking out about it.
“In 1978, UC tuition was $172," former UC Board Regent William T. Bagley told the Northern California Record. "The spike in tuition was instantaneous from 1980 forward because of Prop. 13, which is a good place from which to start a discussion. Parenthetically, what I call the massive tuition today is a parent tax."
Prior to California’s Proposition 13, the UC system funded about two-thirds of its budget with state funds derived from property taxes. Prop. 13 dramatically reduced property taxes and taxpayer funding of universities, down to about 15 percent. In order to make up for the shortfall, the university system quickly ramped up tuition prices starting in 1980.
Bagley, who served on the board of regents from 1989 to 2002, argues that the “parent tax” is one of the reasons tuition prices are high.
“Today, UC tuition nears $14,000 per year, up from less than $4,000 annually in the 1990s," Bagley wrote in a letter to the editor of the Los Angeles Times. "UC Berkeley's Boalt Hall School of Law now charges about $50,000 per year. The public should understand the context of this massive tuition spike. It would be far better to significantly increase state support for higher education, a core element of our infrastructure, than to raise tuition.”
While Proposition 13 caused an initial spike in tuition upon implementation, tuition inflation continued to far outpace consumer inflation during the last couple of decades. For example, resident tuition at the UC Berkeley law school is $48,655 for the 2015-2016 academic year, while a decade ago it was approximately $24,000.
What’s driving tuition inflation?
“I can’t answer you, but that’s a great question,” Bagley said.
He doesn’t attribute it to administrator salaries, though many do.
“Chancellors are making $400,000; presidents make $500,000 or $600,000," he said. "That is a minuscule part of 1 percent of the total budget, which when I was on the board was $13 or $14 billion. It’s probably $17, $18 or $19 billion today."
He also does not attribute it to bond debt.
“The budget has been all vastly done percentage-wise by bond issues, although they’re 30-year bonds, so it’s only the last 30 years, which I guess is the critical part of outstanding bond indebtedment," Bagley said. "So that’s certainly a component."
Whatever the cause of gross tuition inflation, Bagley believes the overall cost of education cannot be blamed on California alone.
“The other institutions have been equally impacted, meaning nationwide," he said. "Although I don’t think it’s such a great, massive percentage increase that we’re talking about. No, from $172 to $13,000 is absurd."
The Atlantic reports that as America’s population ages and the rate of retirement rises, the burden on university pension and health care funds grows. Lawmakers are requiring more disclosure from universities nationwide on just how much is owed to retirees. The UC system’s pension fund has an estimated $8 billion to $16 billion shortfall.
The publication cites experts’ warnings “that the pension problem could foil the institutions’ promises to contain their costs, and instead result in continued upswings in tuition despite the fewer courses, programs, and services offered — especially at public universities.”
In May, the University of California announced it had reached a long-term funding deal with the state that caps resident tuition at its current level for the next two years and provides a one-time infusion of $436 million over three years for UC’s pension obligation.