Higher Ed | Daily Report

ucla90024/Wikimedia CommonsCollins Center at UCLA Anderson School of Management

At a time when California's public universities are bemoaning the decline of state funding as a piece of their overall budgets, one highly ranked public graduate school is planning to forgo state funding altogether in favor of greater flexibility.

Officials at UCLA's Anderson School of Management say forfeiting state funding would give the school more freedom to set fees and spend fee revenue. The plan – described by UCLA as financial self-sufficiency – would entail fee increases for students and stepped-up fundraising from private donors.

Key groups at UCLA have already endorsed the plan – including 80 percent of Anderson faculty and UCLA Anderson's Board of Visitors.* The proposal now awaits sign-off from UC President Mark Yudof, according to a briefing memo from UCLA.

UCLA Anderson currently gets about $18 million per year in state support – nearly one-fifth of its $96 million budget. About $8 million of that comes from student fees, an amount that UCLA Anderson would keep under the self-sufficiency plan. 

To make up the difference, UCLA Anderson would increase fees for students. California residents pay $41,000 per year, not including room and board, books or other expenses. For nonresidents, the annual fees run about $49,000. UCLA Anderson Dean Judy D. Olian told Inside Higher Ed that if the plan goes through, she would expect the school to increase nonresident fees to somewhere between $53,000 and $58,000.

There would be some relief for California residents. Under the plan, students living in the Golden State would get a $5,000 annual tuition discount. The school would also increase student aid for all students by about 30 percent.

According to UCLA, the change would allow the university to use some of the state money that used to be earmarked for Anderson for other priorities, such as overenrolled undergraduate classes.

The memo also suggests UCLA Anderson would pay a sort of tax to the university for centralized services.

Olian described the change as "marginal" in an interview with Inside Higher Ed, pointing out that UCLA Anderson already generates about 82 percent of its funds on its own through revenue-producing programs, such as the Executive MBA or the Fully Employed MBA.

But the move would be quite rare among public universities. The University of Virginia's Darden School of Business is one of the few to have chosen the self-sufficiency route, in 2003.

In an article in Continuing Higher Education Review, UC Berkeley Professor David L. Kirp wrote [PDF] that the structural changes at Darden "alters the dynamic of the relationship with the campus community, as well as shifts priorities within the business school. A successful market strategy – perhaps the only strategy to escape mediocrity – has diminished the academic commons."

UCLA officials stress, however, that the stand-alone nature of the Anderson school would not take away from its public mission.

"The School would remain unchanged in its commitment to the public mission, affiliation with the University and academic units across the University, and adherence to faculty and curricula procedures," the memo reads.

*This sentence originally read, "Key groups at UCLA have already endorsed the plan – including Chancellor Gene Block, 80 percent of Anderson faculty and UCLA Anderson's Board of Visitors."