The UCLA Academic Senate approved a plan today to shift the Anderson School of Management's daytime MBA program to a self-funded model. Anderson's MBA program has been around since 1939 and has always been state-funded. But now it will be supported only by tuition and donations, according to UCLA.
The total savings will be $8.8 million, which would be diverted to other programs at UCLA, making up for budget cuts brought on by the ongoing fiscal crisis in state-supported higher education in California.
UCLA Anderson is generally considered an elite, top-20 business school, as ranked by publications such as Forbes and U.S. News & World Report. Tuition is currently over $45,000 per year for California residents and over $52,000 per year for out-of-state students studying full-time.
The vote in the UCLA Academic Senate was 53-46 in favor of the move, with three abstentions. The proposal now goes to the full University of California Academic Senate and UC President Mark Yudof for a final vote.
A shift from state to self-support at Anderson is nothing new: five of its six degree programs are already self-supporting. The daytime MBA just completes the set.
Self-support has been successful at other schools: both the University of Michigan and the University of Virginia have pursued a similar course with their MBA programs, to no ill effect.
In the MBA context, self-support makes a lot of sense. Full-time MBA students are often youthful veterans of lucrative stints in the finance sector or the consulting business. They've saved up for an MBA in order to advance their careers. In some cases, their firms will pay for their tuition. MBA grads are also pretty good bets to pay back their students loans, if they have to take out any.
MBA alumni can also be counted on to contribute generously to their alma maters. So if UCLA is looking for ways to make limited state-funding go farther in these days of ever-growing deficits, sending Anderson's MBA program off on its own is a good place to start.