As the University of California's regents look for new sources of money to make up for state budget cuts, they are finding that university alumni are not as willing to donate as they may have hoped.
In interviews, a dozen alumni who paid more modest sums for tuition several years ago say they are less apt to give if it means maintaining existing programs or staff salaries, rather than say, expanding university offerings.
“What we have found is that a lot of the alumni think back to when they went to school and they think, I did it, why can’t they do it?” said Nathan Bostrom, executive vice president for business operations for the University of California. “But the state makes up just 11 percent of our budget now. So it will have to come from other funding sources.”
Alumni are also skeptical about how UC will spend the money they give.
"The university is being run more and more like a corporation, so there's not a lot of faith I can put into the administration right now," said Alejandra Cruz, who graduated from UC Berkeley in 2006 before earning her law degree from UCLA last year. "I'm afraid that my money won't go into bettering the university as a whole. Instead it will go into the pockets of university administrators or to another construction project."
The shaky economy is another reason for alumni reluctance. Rex Hime, a former member of the University of California Board of Regents, said while alumni are concerned about the impact of budget cuts on the UC system, many are worried about their own finances.
“The alumni I’ve talked to feel that as of July of this year, that the University of California was no longer a public institution because more funding is coming from tuition this year. That to many folks is a real crime,” said Hime, a member of the Cal Aggie Alumni Association Legislative and Advocacy Committee. “But these are difficult times for everybody, so when you talk about giving a gift like you did a few years ago, it’s tough because the whole the economy is on hold.”
UC alumni tend to donate less than graduates of other schools. In the 2009-10 fiscal year, the percent of alumni who gave to UC Berkeley and UCLA hovered around 8.6 percent, compared to a nationwide mean of 11.6 percent among public and private universities, according to the Council for Aid to Education, a nonprofit education research organization.
UC’s alumni giving rate also lagged behind those of other large, public universities that year, such as the University of Michigan (12 percent), the University of North Carolina at Chapel Hill (19 percent) and the private University of Chicago (20.7 percent).
The relatively low level of alumni support underscores the difficulty UC faces as it tries to preserve its reputation as a top-tier public university and remain affordable for students from low- and middle-income families.
For the first time, UC is receiving more of its funding from student tuition than from the state, which cut the university's budget by $650 million this year. The 10-campus system is facing a $2.5 billion budget shortfall over the next four years.
This fall, UC President Mark Yudof proposed raising tuition 8 to 16 percent a year through 2016 to provide the system with a reliable source of funding. But at a Board of Regents meeting earlier this month, some regents, including Richard Blum and Sherry Lansing, pressed the university to be more aggressive in its fundraising efforts.
“Tell me why you don’t go to a Chevron, Apple, Google, many of these companies are sitting on millions of dollars,” Blum said. “If you look at the money we raise, 75 percent is for health care or designated in different directions.”
Yudof said the university could not rely on private fundraising alone and called tuition increases more "realistic."
University officials have cautioned that public fundraising campaigns can be unpredictable as far as the amount of money they bring in each year.
The 10-campus system raised about $1.3 billion in private donations in the fiscal year that ended in June 2010, according to its annual report. That is up slightly from the year before, but off from a peak of $1.6 billion in the 2007-08 fiscal year. While the modest uptick in giving for the 2009-10 fiscal year was encouraging, the university’s expenses for pensions, salaries and enrollment continue to grow.
UC is facing two additional challenges in its fundraising efforts. First, the university needs more money for financial aid programs. But that will require persuading donors — many of whom are ardent supporters of a specific campus or program — to shift their focus to a broader cause.
“For most donors and individuals and corporations, they tend to want to give to a campus,” Bostrom said. “Otherwise it is quite amorphous. If we can establish a funding model, I do think there are corporations who would give regardless of the campus.”
The university is scrambling to build a broader fundraising mechanism, one that extends beyond the current system, where fundraising is largely overseen by the chancellors and development offices at each campus.
Second, it will take years for UC to cultivate relationships with donors and lock in major gifts — especially given the lagging economy.
Bostrom said the university is developing a “rigorous” fundraising campaign. It recently hired a director of corporate relations, who will be charged with determining how much money the university could potentially raise from corporations and how to go after new donors.
But until those donations are secured, the university will likely continue to rely on tuition increases.