Report 2015-107 Recommendation 21 Responses

Report 2015-107: The University of California: Its Admissions and Financial Decisions Have Disadvantaged California Resident Students (Release Date: March 2016)

Recommendation #21 To: University of California

To ensure that its rebenching efforts lead to equalized per-student funding among the campuses, the university should include actual enrollment numbers in its rebenching formula.

Annual Follow-Up Agency Response From November 2017

The Systemwide Budget Manual states that "[I]n consultation with campuses, the Office of the President will establish enrollment levels for State-supported programs at each campus for purposes of allocating State funds." That consultation resulted in the budgeted enrollment levels for 2016-17 as well as the updated budgeted enrollment levels for 2017-18. In response to CSA's assessment, UCOP has modified the Systemwide Budget Manual to include the word "annually" in this requirement.

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

1-Year Agency Response

The differences between budgeted and actual enrollment noted by the auditors have been greatly reduced upon completion of the rebenching "phase-in" in 2016-17. Going forward, UC will use enrollment targets determined with campuses as the basis for allocating per-student State funding. Using enrollment targets instead of actual enrollment for purposes of allocating State funds provides the University with a mechanism for regulating growth across campuses and for ensuring that no campus's allocation of state funds is adversely affected by another campus's enrollment decisions. To the extent that actual enrollment levels conform to those enrollment targets, per-student funding can be expected to be equivalent across campuses.

California State Auditor's Assessment of 1-Year Status: Partially Implemented

The university has not provided any support related to the asserted reduction between budgeted and actual enrollment numbers. As noted previously, in order for the intent of this recommendation to be fully implemented, we would expect the university to incorporate a requirement to update its enrollment targets annually into its Systemwide Budget Manual to ensure that the process is an ongoing activity.

6-Month Agency Response

The University intends to complete the rebenching process and its two-year plan to fund overenrollment with allocations made for 2016-17. Following that, UC will use enrollment targets determined with campuses as the basis for allocating per-student State funding. Using enrollment targets instead of actual enrollment for purposes of allocating State funds provides the University with a mechanism for regulating growth across campuses and for ensuring that no campus's allocation of state funds is adversely affected by another campus's enrollment decisions. To the extent that actual enrollment levels conform with those enrollment targets, per-student funding can be expected to be equivalent across campuses.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

The university's plan to base its campus funding allocations on enrollment targets instead of actual enrollment can further equalize per-student funding and satisfy the intent of our recommendation so long as the university uses enrollment targets that it updates annually. As we discuss on page 83 of our report, by using outdated budgeted enrollment—from fiscal year 2011-12 for the first three years of its rebenching process—the university failed to design a method for ensuring equity in per-student funding. However, by using enrollment targets that are updated annually rather than actual enrollment as we recommended, the university would satisfy the intent of our recommendation, which was that the university use more realistic and more current enrollment numbers in its campus funding allocations.

In order for this recommendation to be fully implemented, we would expect the university to incorporate this new process into its Systemwide Budget Manual to ensure that the process is an ongoing activity.

60-Day Agency Response

The University intends to complete the rebenching process and its two-year plan to fund overenrollment with allocations made for 2016-17. Following that, UC will use enrollment targets determined with campuses as the basis for allocating per-student State funding. Using enrollment targets instead of actual enrollment for purposes of allocating State funds provides the University with a mechanism for regulating growth across campuses and for ensuring that no campus's allocation of state funds is adversely affected by another campus's enrollment decisions.

California State Auditor's Assessment of 60-Day Status: Pending

The university stated that it intends to use enrollment targets as the basis for allocating per-student state funding. We asked the university how often it intends to update the enrollment targets, but it stated that its initial 60-day response provided sufficient information. Because the university has begun the process of rebenching using enrollment targets, but has not provided sufficient detail related to how often it intends to update the targets, this recommendation is pending.

All Recommendations in 2015-107

Agency responses received are posted verbatim.