UCLA faculty votes to wean MBA program off state funding

UCLA faculty leaders on Thursday narrowly approved a controversial plan to wean the campus’ signature MBA program off state funding and have it survive on tuition and donations.

The move was viewed by many around UC as a possible turning point in how California’s public universities should respond to years of state budget cuts. Some said the proposed change at the Anderson School of Management’s full-time MBA program may start a trend, particularly among business and law schools that are able to charge high fees and have wealthy alumni to help support them. But critics said such an action would harm the public nature of the 10-campus UC system.

The UCLA faculty senate’s Legislative Assembly voted 53 to 46, with three abstentions, in favor of the plan to make the master’s of business administration program self-supporting, according to UCLA psychiatry professor Andrew Leuchter, chairman of the faculty senate. He described the closed-door debate as passionate but polite, influenced by fear of more state funding reductions.

Some voters were swayed, Leuchter said, by a projection that the plan will shift about $8 million in mainly state funds from the Anderson school to other, needier divisions of the Westwood campus. “I think people recognized that because of the extraordinary circumstances we find ourselves in, we need to reconsider the financial model by which we run the university,” he said.

UCLA Chancellor Gene Block said he was pleased with the vote. “The UCLA Anderson proposal would aid not only the professional school but the entire campus as we adjust to the loss of state funding,” he said in a statement.

As initially made public in the fall of 2010, the plan would have made the entire Anderson school self-supporting, but the final version was limited to the 720-student full-time MBA program and kept the school’s doctoral degree and undergraduate accounting courses on public support. In March, the faculty senate panel that controls graduate studies voted against the proposal, and Anderson administrators won on appeal Thursday.

Judy Olian, the Anderson school dean and the author of the plan, said she hoped it could go into effect July 1 if other approvals are obtained. Donors have promised $19 million in gifts in the expectation that the MBA program will become more innovative once it becomes financially independent from state support, she added. Olian also said that tuition may rise more slowly under the new model than it would have under state funding.

Some on campus expressed concerns that UC will be moving toward partial privatization. Anderson school professor Christopher Tang said he and other opponents worry that the proposal might send a message to the public that UC will become inaccessible and unaffordable. As a result, he said, he feared that some of the best potential students might decide to enroll elsewhere.

To go into effect, the plan now needs approval from the statewide UC faculty senate and UC system President Mark G. Yudof.

About 40 programs in the UC system already take no state funds, mainly part-time studies. If the Anderson School moves ahead with the plan, it would be the biggest mainstream UC academic program to do so.

larry.gordon@latimes.com