A Little Brain Twister

November 30, 2009
Mark Yudof, President
University of California

Dear President Yudof;

I have just come upon what looks like a significant error in the University’s budgeting/accounting system and I ask that you look into this promptly. It concerns certain fees paid by UC students.

In the Budget for Current Operations (Detail) there is a table at the back that shows “Income and Funds Available”. One item listed there is “Student Fees: Application for Admission and Other Fees” in the annual amount of $28 million. This revenue is listed under UC General Funds, which means that it will be combined with State General Funds to form the “core” budget for the University’s operation.

If I then look at the accounting report “UC Campus Financial Schedules” (for 2007-08), I can find details of Expenditures of Current Funds for each campus; and on Schedules C, under Student Services, there is an entry for “Admissions”. If I add the General Fund portion of that expenditure for each campus I find a total amount of just under $29 million. So that seems to mesh with the number quoted as Income from the Budget.

The problem arises when one notes that all of the expenditures from General Funds for Student Services are replaced by funds coming from other student fees. This is the line item labeled as “Educational Fee Expense Proration” in the Campus Financial Schedules.

The conclusion I draw from these facts is that students are being charged twice for the same service. They pay Application for Admission Fees when they first apply to any campus, and it seems reasonable that that money would be used to cover the costs of processing their applications. But then it turns out that the actual operations of those offices that handle their applications are paid for with the Educational Fees that the students must pay when they enroll.

Please let me know if you find anything incorrect in the data or interpretations I have given above; and, if I am correct, I trust you will move rapidly and publicly to repair this mistake.


Charles Schwartz
Professor Emeritus
UC Berkeley
December 14, 2009
Dear Professor Schwartz:

I am writing in response to your 11/30/09 email to President Yudof regarding Application for Admission and Other Fees paid by UC students.

Based on a long-standing agreement with the State, revenue from Applications for Admission is pooled with other general funds earned by the University to provide unrestricted general support for the university’s core mission activities.   Collectively referred to as UC General Funds, these also include a portion of overhead on federal and state contracts and grants, DOE laboratory overhead and management, nonresident tuition, a portion of patent royalty income; and interest on General Fund balances.

The intent of the UC General Fund is to provide undesignated funding, irrespective of functional source of the revenue.  For expenditure, most of these revenues are pooled with State General Funds into a single fund number and thus become largely indistinguishable.   The application fee revenue is not explicitly tied to funding campus admissions offices.

Educational Fee revenue also provides general support for the University’s operating budget, including student financial support.  In order to simplify and reduce the departmental administrative burden of split-funding their general activities, Educational Fee revenues are also pooled with other General Funds into a single fund number (except for the portion used for financial aid).  In order to reflect Educational Fee expenditures in the accounting statements, expense transfers are implemented at year-end at the functional level, and it is our practice to transfer all General Fund expenses in student services to Educational Fees.

Please rest assured that students are not being double-charged to fund the same activity.


Debora Obley
Associate Vice President —
Budget Operations
University of California
Budget and Capital Resources
December 14, 2009
Mark Yudof, President
University of California

Dear Mark;

On November 30 I wrote to you pointing out what appeared to be a significant error in the University’s budgeting/accounting system – concerning the payment of student fees for Applications for Admission.  After detailing the facts on record, I concluded that students are being charged twice for the same service; and I asked you to investigate and correct that situation.

Now I have received a response from your office; it comes from Debora Obley, Associate Vice President for Budget Operations. Her letter verifies in detail every bit of the factual story that I had laid out in my letter. But then she reaches the diametrically opposite conclusion, namely, “that students are not being double-charged to fund the same activity”.

Such illogic must be embarrassing to any member of this academic community; and your office, in particular, is in great need of rebuilding and protecting its public image. So I think it only fair to give you the opportunity to reconsider this matter.


Charles Schwartz
Professor Emeritus
UC Berkeley


  1. Alla said,

    June 2, 2011 @ 9:01 am

    I thank you humbly for srhaing your wisdom JJWY

  2. MIlan Moravec said,

    June 2, 2011 @ 10:12 pm

    Wage cocessions from University of California demonstrate commitment to Califrnians and to saving the University.
    The 10 University of California (UC) campuses, UCOP are not untouchable: Californians fund UC. Californians face foreclosure, unemployment, depressed wages, loss of medical, unemployment benefits, higher taxes: UC Board of Regents Regent Lansing, President Yudof demonstrated leadership by curbing wages, benefits. As a Californian, I don’t care what others earn at private, public universities. If wages better elsewhere, chancellors, vice chancellors, tenured, non tenured faculty, UCOP should apply for the positions. If wages commit employees to UC, leave for better paying position. The sky above UC will not fall.
    California suffers from the greatest deficit modern times. UC wages, benefits must reflect California’s ability to pay, not what others paid elsewhere. Campus chancellors, vice chancellors, tenured & non-tenured faculty, UCOP are replaceable by the more talented.
    UC faculty, chancellor vice chancellor concessions:
    No furloughs
    18 percent reduction in UCOP salaries & $50 million cut.
    18 percent prune of campus chancellors’, vice chancellors’ salaries.
    15 percent trim of tenured faculty salaries, increased teaching load
    10 percent decrease in non-tenured faculty salaries, as well as increase research, teaching load
    100% elimination of all Academic Senate, Academic Council costs, wages.

    Rose bushes bloom after pruning.

    UC Board of Regents Sherry Lansing, President Yudof can bridge the public trust gap by offering reassurances that UC salaries reflect depressed wages in California. The sky will not fall on UC

    Californians are reasonable people. Levy no new taxes until an approved balanced budget: let the Governor/Legislature lead – make the tough-minded (not cold hearted) decisions of elected leadership. Afterwards come to public for continuing, specified taxes.

    Thank you for advocating for all Californians, University of California

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