The Board of Regents approved a new expenditure tax requiring all campuses pay a 1.69 percent fee on all revenue-earning funding streams, including student lock-in fees in an effort to restructure the UC Office of the President’s funding model.
The tax, which also applies to student lock-in fees, is raising concerns that it could create a significant funding deficit for individual campuses. UCSB Associated Students — estimated to owe upwards of $200,000 under the new plan — is fighting to base the tax fee off of a budget excluding student fees.
According to A.S. Executive Director Marisela Marquez, the expenditure will effectively triple-tax students’ dollars due to A.S. receiving nearly its entire funding from student fees.
“UCOP used to take all the revenue, take off the top what it would cost to run the office, and return the rest to the campus. Instead of pre-paying, each campus will receive funds then pay a tax back,” Marquez said. “We essentially collect the funds, but we pass them right on. It seems impossible to impose a tax on that.”
The change aimed to be revenue-neutral and leave no deficit on either side of its transaction compared to the previous structure.
However, A.S. President Harrison Weber said the tax imposes a significant funding cut to the campuses.
“[The tax] was supposed to change the stream of funding rather than actual funding, but it’s a $50 million mistake,” Weber said. “Essentially a $50 million budget cut is coming down from the Office of the President. As a system we are feeling a $50 million bigger crunch than if things had stayed the same; UCSB’s share of that is $10 million.”
The A.S. Legislative Council opposed the measure during its weekly meeting Wednesday night. The council passed a resolution to delay paying the tax on A.S. fees until the latest possible date. The resolution, written by On-Campus Representative Jonathan Abboud, mentions that UCOP is assessing the tax based on the 2009-2010 fiscal year’s budget rather than this year’s significantly lower budget.
Additionally, the tax violates a 2009 UCSB Memorandum of Understanding instituted by former A.S. President J.P. Primeau prohibiting any taxes on student-initiated fees.