UC Gave Millions in Low-Interest Home Loans

The University of California has awarded $702 million in low-interest home loans to executives, faculty and staffers, including some to employees who did not qualify under university policy.

There are nearly 2,000 active university-issued loans, most carrying interest rates of 3% to 4%, but some with much lower rates, the San Francisco Chronicle reported Thursday.

Officials with the 10-campus system refused to reveal who received the money, citing employee confidentiality. But they released some details, including an unidentified UC Berkeley professor who was given a $250,000 home loan with an interest rate of 0.5% a year. An unidentified UCLA professor received loans worth up to $1.5 million.

Dozens of loans were awarded as “exceptions to policy” to unidentified aides and other employees who wouldn’t normally qualify, UC officials said. The perk is usually reserved for professors and top executives.

The loans are not offered at the state’s other public university system, California State University. UC officials have defended the practice, saying the interest and fees recouped from the loans generally equal the amount earned on other short-term investments.

But Senate Majority Leader Gloria Romero (D-Los Angeles) said UC’s refusal to release information on the loans contradicts promises to be more transparent about financial matters.

The promises came in response to a pay controversy that erupted last fall over revelations that UC executives were granted millions of dollars in bonuses, housing allowances and other perks without proper approval.