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2020 Hindsight: ASUCD Financial Report

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2020 Hindsight: ASUCD Financial Report Associated Students, University of California, Davis 2020 Hindsight: ASUCD Financial Report January 2020 Associated Students University of California, Davis Prepared By: Kevin Rotenkolber – ASUCD Controller Questions? : [email protected] Financial Report 2020 1 Associated Students, University of California, Davis Table of Contents 3 Introduction 4 Report Summary 5 ASUCD’s Base Fee 6 ASUCD vs other ASUC’s 8 What can be done? 10 First Amendment Context ASUCD Financial Report 2020 2 Associated Students, University of California, Davis Introduction When I first joined ASUCD, it was in a state of financial Back to the Beginning freefall. This was as a result of multiple years of poor The Associated Students, University Farm (ASUF) was management at the very top of the Association from founded in 1915 to represent the students at the University previous executive teams, forces beyond the control Farm, the UC Berkeley extension that became UC Davis in anyone within the Association that were difficult to foresee 1955. This same year ASUF was renamed and remains to without an extensive knowledge of sound fiscal and this day the Associated Students, University of California, business practices. And while I was able to stabilize the Davis operating with a largely unchanged governance budget for this year, the underlying problems will continue structure and primary mission: to serve the students of this to impact this association until drastic action is taken. This campus and improve their quality of life during their time report is intended to layout the major milestones in the here. This makes ASUCD the oldest governing body on the history of the Associated Students, University of California, campus, and expanding services to the student body, Davis that led to our current situation and how we move on providing basic needs, opportunities in advocacy, education, from here towards a more stable future. events and programs. v v ASUF Renamed ASUCD ASUCD Raises Fee California Aggie (formerly Weekly Fee Increased from $7 to $8 Agricola 1915-1922) Budget deficit stabilized El Rodeo Student Government represents all Student Government represents all 12,581 undergraduates 1,492 undergraduates 1915 1955 1968 1979 Today ASUF Created ASUCD Expands Fee Unchanged Weekly Agricola Creation of Unitrans and the Coffee Minimum wage rising faster Picnic Day House than ever before in history Student Government represents all KDVS Radio and Experimental College Units at risk of disappearing 353 undergraduate students created 1967 Student Government Student Government represents all represents all 30,066 8,296 undergraduates undergraduates ASUCD Financial Report 2020 3 Associated Students, University of California, Davis Report Summary ASUCD is currently facing a financial crisis unseen in its below) and using the fee revenue from one student, ASUCD history and unseen in the history of any ASUC. Excluding the could pay one employee for 1 hour of minimum wage work. budgets for Unitrans, Coffee House, and the California As of January 1st, 2020 minimum wage is $13/hour, Aggie, ASUCD’s discretionary funding is approximately $1M meaning that minimum wage is 1.625 times larger than to split between Bike Barn ($487,582), KDVS Radio ASUCD’s base fee, and by 2030 it is projected that minimum ($127,959), Creative Media + Aggie Studios ($255,934), with wage will be 2.5 times the size of ASUCD’s current $8 base the rest split between the other ASUCD Units. Most of fee. ASUCD’s units produce their own income to offset their Quarterly Fees costs, but many regularly operate in a deficit that is paid for $2.00 $0.50 by other profitable units. In a static financial environment it’s a sustainable system, however, there are a number of factors that are placing significant strain on the $8.00 Association’s finances. $24.50 Minimum Wage and ASUCD In 1916, California instituted a statewide minimum wage of Unitrans ASUCD EOP Cal Aggie Camp $0.16/hour or about $4.81/hour in 2018 dollars. Over the years the CA minimum wage has been adjusted to increase California’s minimum wage has never grown as rapidly as it 31 times while the fee that was intended to pay for all of has in recent years and ASUCD has not increased its Base ASUCD’s services has changed 3 times since 1916 for a total Fee since 1979 when it increased from $7 to $8. This of $5.50 of total nominal increase in 104 years of operations. exponentially increasing minimum wage necessitates that As a result of this stagnation in fee revenue over the ASUCD increase its Base Fee or significantly decrease its previous 40 years many of ASUCD’s programs, events, operations such as The Pantry, KDVS Radio, Whole Earth services, and employment opportunities have been Festival, and many other aspects of student life at UCD that reduced in both quantity and quality. In 2006, the CA many couldn’t imagine life without. minimum wage reached $8/hour. This means that after 90 years minimum wage became equal to our Base Fee (see ASUCD Financial Report 2020 4 ASUCD Financial Report 2020 ASUCD’s Buying Powerin Nominal and Real Terms (Real terms in dollars) 2018 words, other in lookingat the value of our dollar to across time provide example a modern of value the of fee. ASUCD’s base The damages caused by the stagnation of ASUCD’s fee is particularly apparent when examining the fee adjusted for inflation, or 1979 tocurrent $8.00. its following the fee mandate. In 1974, the fee was increased from $5.00 to $7.00 followed by a vote to increase the Base fee in KDVS Radio, Experimental College, Coffee House, Unitrans, Bike Barn, and Whole Earth Festival were all created in the 5 years at UC Davis, this led to a large funding increase for ASUCD and led to the creation of a number of units and programs including quarter each tosemester each paid being switchedfrom fee the 1966, In provided. it services the fund help to $5.00 to increased In 1916 ASUCD, then ASUF, had a $2.50 fee that undergraduates of the University Farm could volunteer to pay. In 1926, it was ASUCD’sFee Base $100.00 $120.00 $140.00 $20.00 $40.00 $60.00 $80.00 $0.00 1916-1917 1919-1920 1922-1923 1925-1926 1928-1929 1931-1932 (projected) 1916-2030 Wage Minimum vs Fee Bae ASUCD 1934-1935 Nominal Fee Nominal 1937-1938 1940-1941 1943-1944 1946-1947 1949-1950 1952-1953 1955-1956 1958-1959 1961-1962 RealFee 1964-1965 1966-1967 1969-1970 1972-1973 1975-1976 Associated Students, University of California, Davis 1978-1979 1981-1982 CA MinimumWage CA 1984-1985 1987-1988 1990-1991 1993-1994 1996-1997 1999-2000 2002-2003 2005-2006 2008-2009 2011-2012 2014-2015 2017-2018 2020*-2021* 2023*-2024* 2026*-2027* 2029*-2030* 5 Associated Students, University of California, Davis ASUCD vs Other ASUC’s The Student Government for ASUCD is not the only one in Comparing Operating Budgets the UC System. Each UC Campus has an Associated Students ASUCD currently receives $788,900 for the year in revenue or Student Union to represent student voices and run from its current $8 fee to contribute to its $15,363,565 programs, events, and services. The fundamental operating budget for the 2019-2020 fiscal year leaving difference between ASUCD and any of the other ASUC’s at ASUCD businesses, programs, & events to raise the rest. the other campuses is that ASUCD has retained its financial This means that after excluding the California Aggie and autonomy, meaning that it is financially independent from Unitrans which are currently funded by their own fees, UC Davis, and the ASUCD budget is determined at every ASUCD student employees are asked to raise the other level by students. The other ASUC’s are financially 90.51% of ASUCD’s operating expenses through our controlled by their University admin and as such cannot commercial operations. All of the other ASUC’s are entirely make decisions regarding spending and services. funded by their fees, this difference is apparent when comparing the operating budgets of each ASUC. Comparing Base Fees Annual Budgets by Campus As stated above, ASUCD’s base fee is $8 per quarter, for an $18,000,000 annual revenue of $24. To effectively compare the value of $16,000,000 ASUCD to other ASUC’s one must first compare the fees $14,000,000 $12,000,000 associated with each ASUC. $10,000,000 $630.00 $630.00 $8,000,000 Annual Fee by Campus $6,000,000 $4,000,000 $700.00 $262.28 $262.28 $2,000,000 $219.18 $219.18 $600.00 $205.74 $0 $131.36 $131.36 $114.00 $114.00 $500.00 $112.00 $400.00 $28.00 $28.00 $300.00 $24.00 $200.00 $100.00 $- Operating Budgets Can ASUCD continue as it currently exists? Annual Fee In a word, no. ASUCD is a non-profit, which means that when costs increase, cuts have to be made to either student As shown above, ASUCD’s base fee is the lowest in the UC employment, services, or entire programs altogether. Due system. The only comparable fee in the UC system is UC to minimum wage increases and three mandatory fees Santa Cruz with $28/year with UC Santa Barbara on the high imposed on it this year, ASUCD is looking at approximately end with $630/year with the rest of the campuses averaging $398,000 in increased costs from last year’s historic budget $174.09/year. cuts. This means that between 2019-2021 an estimated ASUCD Financial Report 2020 6 Associated Students, University of California, Davis $943,000 would have been cut from ASUCD’s approximately $1M in discretionary spending.
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