Tuition plan alarms UC board

The University of California regents Thursday were so divided over a proposal that could raise tuition by 8% to 16% a year through 2015-16 that a vote on the plan is now expected to be delayed until next year.

Sherry Lansing, the regents chairwoman, called it highly unlikely that the board would decide on the long-term budget plan at its next meeting in November -- its last in 2011-- as had been planned. Instead, she and several other influential regents said UC should first try to raise billions of dollars in corporate and alumni donations and look for new tax revenues to make up for steep state funding cuts to higher education.

“We’ve seen the possibilities, and we don’t want to accept them,” Lansing said of the budget proposal, which projected that UC undergraduate tuition could jump 16% annually, to more than $22,000 by 2015-16, if state funding does not increase. Tuition this year is $12,182, not including room, board and campus fees.

But if funding for the university rises 8% annually, more moderate tuition increases of 8% a year are likely, with tuition reaching $16,596 in four years, the plan projects.

In introducing the proposal, UC President Mark G. Yudof said it should be considered a warning of what may happen if the state does not reverse some of its cuts to the university.

“The people of this state and the Legislature and the students have to know the situation we are in,” Yudof said. Less palatable alternatives could include raising the number of out-of-state students, who pay higher fees, or chopping faculty positions and class sections, which would make it more difficult for students to graduate in four years, he said.

Lt. Gov. Gavin Newsom, a regent because of his office, was among the idea’s opponents. Newsom is convening meetings of UC, the California State University system and community college officials, along with labor and business leaders, to try to come up with a plan for better higher education funding. He said that might include an oil and gas production tax dedicated to colleges and universities.

Newsom said the higher tuition projections could alarm parents and students. “This is not the way to get the voters to say, ‘I love supporting the [UC] system,’ ” he said.

Regents Richard Blum and Eddie Island urged university leaders to launch a fundraising campaign to persuade California businesses to donate billions for student financial aid.

“There is money in California. There is an opportunity to save this university,” said Island, who said higher tuition would especially harm UC’s growing population of minority and low-income students.

In other action Thursday, the regents approved hefty incentive awards and pay raises for eight UC financial and medical center executives.

Marie Berggren, the university’s chief investment officer, was given the largest bonus, $744,950, bringing her total annual cash compensation to $1.2 million.

Officials said that Berggren helped achieve significantly better than expected returns on UC’s $70-billion endowment and retirement funds and that the university was obligated to make the award under a performance-based agreement. The investment officer received almost the same bonus last year but did not get one the year before.

The regents did not publicly discuss that award or others approved Thursday, and Island was the only regent to vote against them.

“I don’t think we can afford to chase market salaries,” Island said later, in response to administrators’ contention that Berggren’s pay was on par with executives at other major public universities and lower than if UC had hired an outside fund manager.

Among other compensation increases approved Thursday was $130,500 for Jack Stobo, UC’s senior vice president of health sciences and services, under an incentive award plan. Stobo’s total compensation for the year will be $710,500. Officials said he met targets for UC hospitals’ improved financial results and fewer cases of patient infections, among other areas.

In a separate item, UC Davis Medical Center’s chief executive, Ann Madden Rice, was given a $215,700 raise, upping her base salary to $800,000, to fend off a recruiting effort by another hospital. Rice is also eligible for $160,000 in performance-based incentives, according to UC documents.

Over the last year, top hospital executives at UCLA and UC San Francisco also received very large raises to counter outside offers.

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larry.gordon@latimes.com