shade awning of the manetti shrem museum uc davis

Budget Framework

Our core funds deficit is growing, so we must make
strategic changes in how we fund our mission. 

"We all have grown very weary of operating in a budgetarily constrained environment; however, I believe that we have an opportunity to make necessary and fundamental changes in how we achieve our mission in a sustainable way."
– Mary S. Croughan, Provost and Executive Vice Chancellor, 2023-24 Operating Budget Framework Letter (PDF)

Since January 2020, the campus has made significant progress toward the goal of reducing ongoing reliance on state funds and tuition revenue (core funds) by $80–100 million by 2025.

The campus is on track to achieve initial savings targets ahead of schedule; however, additional cost pressures have emerged that exacerbate the need to make fundamental, long-term changes in business practices and fund management strategies across all facets of UC Davis. These include:

  • Systemic inflationary pressures 
  • Significant increases in our utility costs
  • Growing salary and benefit costs
  • Unanticipated changes in the results of the UCOP funding allocation formula

Core funds deficit continues to grow

Current projections indicate that the core fund structural deficit will grow to $58.5 million by the end of fiscal year 2023-24. These projections already assume that the $70 million in savings targets allocated in 2020 are achieved by fiscal year 2024-25 as planned, and that previous central campus funding commitments are honored. 

Resolving our core funds structural deficit will allow UC Davis to invest in strategic priorities, build a responsible central reserve and meet future challenges. To meet this goal and achieve financial sustainability, we must make fundamental, long-term changes in business practices and fund management strategies across all facets of UC Davis. All parts of campus must continue to work together to rebalance the budget for core funds.

While we are on track to achieve ahead of schedule (with 72.4% of our five-year goal achieved in just three years), these added budgetary pressures require that we provisionally increase unit savings targets by an additional $9 million collectively by 2026, bringing the total unit savings targets over six years to $54 million.

UC Davis must address this challenge with our combined strategies of multi-year actions. To help guide these efforts, the Revenue Generation and Institutional Savings Task Force collected hundreds of suggestions from the campus community through the IDEA$ at Work campaign. The task force is currently reviewing each of the suggestions and plans to share a final report in late spring 2023.

In the coming years, we must continue to: 

  • Continue our efforts to identify significant revenue-generating opportunities. 
  • Think differently about how to support our mission and fully leverage all of our fund sources. 
  • Realize efficiencies by reducing duplication of effort and programming. 
  • Use one-time bridging to mitigate the most severe consequences, when necessary. 

While working toward achieving long-term financial sustainability, we must make fundamental changes in how we approach our teaching, research, service and operations. Provost Croughan will convene a new task force in spring 2023 to develop recommendations and action plans over the next 12 months, with the goal of implementing changes by fall 2024. The work of this task force will complement the work of the Revenue Generation and Institutional Savings Task Force and the Student Success and Equitable Outcomes Task Force.

2023–24 Budget Framework Letter (PDF)