January 2026

Universities

Comparing Three Budget Packages for UC

(In Millions)

  Governor's Plan   LAO Alternative: High End   LAO Alternative: Low End
  2026-27 2027-28 2028-29   2026-27 2027-28 2028-29   2026-27 2027-28 2028-29
General Fund                      
Ongoing base increasea $254 $254 $254   $163 $163 $163        
2 percent ongoing base increase (for Year 4 of compact) 96 96 96                
Nonresident enrollment replacement 61 61 61                
Resident enrollment growth         81 81 81   $81 $81 $81
One-time back payment (for Year 4 of compact)   272                  
Retire deferralb   130       130          
3 percent ongoing base increase (for Year 4 of compact)     144                
Restore ongoing base 130 130 130   130 130 130   130 130 130
Subtotal ($541) ($943) ($686)   ($374) ($504) ($374)   ($211) ($211) ($211)
Tuition Revenue                      
Ongoing base increasec $273 $273 $273   $273 $273 $273   $273 $273 $273
Totald $814 $1,216 $959   $647 $777 $647   $483 $483 $483
Difference from Governer's Plan        -$168 -$439 -$312   -$331 -$732 -$475
Total General Fund savings over period       -$919   -$1,538
                       
a Governor's plan funds a 5 percent General Fund base increase. LAO "High End" alternative funds a 3.78 percent base increase (tied to the state and local government price index) to total ongoing core funding. LAO "Low End" alternative funds no General Fund base increase. To date, no plan has been presented indicating how any base General Fund increase provided in 2026-27 would be sustained in 2027-28 given the projected General Fund deficit that year.
b LAO recommends retiring this deferral as soon as possible. For display purposes, we score it as being retired in 2027-28.
c All three scenarios assume UC raises its tuition charges in 2026-27. UC estimates it will generate $273 million in additional tuition revenue in 2026-27.
d In 2026-27, Governor's plan equates to an 7.1 percent increase in total ongoing core funding, compared to 4.9 percent and 3.5 percent increases for the two LAO alternatives, respectively. The historical ten-year average annual growth rate in UC's ongoing core funding is 4.3 percent.