University Budget Advisory Committee (UBAC)
Meeting Notes
August 5, 2009, 2:00-4:00 p.m.
Sacramento Hall Annex, Conference Room
Members Present: Fred Baldini, Paul Edwards, Scott Farrand, Lillie Jones, Ming-Tung (Mike)
Lee, Laureen O’Hanlon, Steve Perez (Chair), Shawn Smith, James Sobredo
Members Absent: Robert (Bob) Buckley, Jimmy Tsang
Others Present: President Alexander Gonzalez, Stacy Hayano (BPA), Norman Kwong (BPA)
Open Forum: None
Agenda Discussion: The committee continued the previous day’s discussion on how to
address the campus 2009-10 budget deficit, which is currently estimated at $16.4 million.
UBAC verified that in their previous preliminary recommendation an $838K augmentation was
proposed to Student Affairs and after further discussion, that proposal would not change.
Further review of the All University Expenses (AUE) identified additional savings in the
Administration & Business Affairs division, which further reduced the deficit from $16.4 to $16
million.
The committee reviewed the list of one-time expenditure requests, which had previously been
submitted by divisions during the annual budget call process. The committee decided to defer
the majority of the requests, due to the severity of the budget situation, but did identify $465K to
$590K worth of expenditures which they would recommend for approval. Further information for
one of the request is needed in order to finalize the list. Note that one-time expenditures do not
affect the structural campus budget deficit, since these can be funded from one-time (i.e.
carryover) funds.
President Gonzalez joined the committee at 3:20 pm. Previously, UBAC had questions
regarding the university’s $5.7 million commitment towards the CalSTRS building lease. The
President emphasized that UEI had only been acting as an agent for the university, and that the
decision to purchase CalSTRS made sense given the various factors known at the time. The
university (with the Chancellor’s Office endorsement) decided to proceed with the purchase of
the CalSTRS building (through UEI) since state funding for newly constructed buildings is very
limited, and many existing campus buildings are deteriorating and will need to be eventually
replaced.
The President noted that UEI’s fortunes are closely tied to the economy, and noted various
factors which could benefit UEI. These would include higher occupancy rates at the Upper
Eastside Lofts, an increase in on-campus purchases due to the presence of 600 more dormitory
residents (resulting from the opening of the new American River Courtyard Suites), the
mothballing of the Julia Morgan House (which had steadily been losing monies), and various
other cost savings measures implemented in UEI operations. The President left the committee
at approximately 3:45 pm.
UBAC resumed deliberations by asking Stacy if she could inquire about the dollar amount that
the CO was willing to contribute towards the university’s share of the CalSTRS building lease.
She would inquire with Stephen Garcia since he has been working with the CO on this issue. If
the university had a solid number for CO’s contribution to CalSTRS, then that would decrease
the campus’ deficit for the 2009-10 fiscal year and reduce the reduction percentage applied to
divisions.
UBAC then continued to examine available one-time funds. The campus started 2009-10 with
approximately $9 million in carryover funds. Of this amount, $590K was subtracted for one-time
expenditures recommended for approval, leaving approximately $8.4 million available for use.
Of this amount, it was proposed that $5 million be used to temporarily reduce the campus
deficit, which would delay cuts to campus divisions and give them more time to realize more
savings and/or cost efficiencies. The remaining amount of $3.4 million will be held as one-time
reserves for any unexpected expenses or mid-year reductions.
Applying the $5 million in one-time funds against the current deficit of $16 million, results in a
revised deficit of approximately $11 million. After exploring all other methods of reducing the
deficit, the committee decided to recommend that the remaining $11 million deficit to be
distributed to campus divisions, resulting in cuts of approximately 7.54%.
The committee resolved to immediately convey this information to the President, so it would be
available for dissemination in tomorrow’s campus Town Hall Meeting.
Future Meetings (tentative schedule): TBA