The University of California at Berkeley is recognized as one of the top public universities in the nation, but lately it has been making headlines for another reason–its growing budget deficit. To patch holes in its budget, UC Berkeley has been accepting a high number of out-of-state applicants, who pay almost three times higher tuition than in-state students. Naturally, this is not a long-term solution. It restricts access to in-state students. Chancellor Nicholas Dirks recently announced several dramatic changes to decrease the projected $150 million debt they will have accrued by the end of this year.

Causes of the Budget Deficit

Since the 2008 recession, most states have reduced spending on higher education. UC Berkeley now receives about 13% of its revenue from the state, while in the 1980’s the state comprised about half of their annual budget. This dramatic reduction in state funding is reflected in other UC system schools, and indeed in most states around the country. Amidst this perpetual funding crisis, things have been particularly hard for UC system schools. Decreased state funding has been coupled with a statewide tuition freeze implemented in 2011. It’s not all bad news, however. The plan developed by Chancellor Nicholas Dirks to deal with the crisis can serve as a model to other public universities across the nation who find themselves in a similar situation.

Coming Adjustments for UC Berkeley

Chancellor Dirks has announced that the school will have to adjust to a “new normal,” when it comes to their operating budget. He expresses positivity about initiatives to raise revenue and self-reliance for the university, but also acknowledges that some changes will be “painful.” He and other faculty are consulting with all concerned parties to determine the best way to tighten the budget while maintaining a high commitment to academic excellence. That said, the school can expect substantial changes in the coming months.

While specifics have yet to be released, Dirks has outlined his priorities:

  • Eliminating redundancies within the university
  • Evaluating duties of administration and faculty to decrease overlap
  • Merging and rearranging academic departments
  • Raising money through alumni support
  • Restructuring curriculum to offer more online courses

Easier said than done, right?

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