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Prestigious universities across California are shelling out millions of dollars on artificial intelligence tools like ChatGPT for students — even as they lay off professors, The Post has learned.
The prestigious University of Southern California, a private research college, spent $3.1 million in late January on a partnership with OpenAI to secure ChatGPT licenses for 80,000 users, including pupils, faculty and staff.
But professors at private USC, where one year of tuition costs nearly $80,000, were concerned about the school’s spending priorities — especially since it has laid off some 900 staffers in the aim of eliminating a nearly $200 million deficit, HigherED Dive reported in November.
“USC has told students it can’t afford to pay the real people they trusted. Instead, it’s buying them a pretty toy,” a dozen faculty members wrote in a recent open letter to The Daily Trojan, obtained by The Post.
“What kind of human dignity does this behavior affirm? What kind of trust does it build?”
Andrew T. Guzman, provost and senior vice president for academic affairs at USC, defended the spending.
“This includes all user subscriptions and advanced credits for deeper research using the platform, while also providing data privacy that users were not getting with individual subscriptions,” Guzman said in a statement.
But USC is far from alone in spending big on the emerging tech.
California State University has rolled out the AI tool to nearly half a million students and faculty at a price of $17 million.
Some schools in the University of California system, including UC Berkeley and UC Irvine, are making accounts readily available to students, too.
critics are raising eyebrows over the place of AI in higher education — warning it could inhibit learning and questioning the multi-million dollar price tag as some schools lay off professors.
“It goes against what higher education should be about,” said Lee Codding, 55, whose youngest child is a student at San Diego State University, one of 23 campuses in the CSU system.
“We’ve totally jumped the gun. I don’t think it’s a good idea,” the local dad told The Post.
While Codding acknowledged the importance of engaging with AI tools, he warned that having a pro account — which, unlike free versions, performs tasks at a much higher capacity — could inhibit critical thinking.
“They’re probably doing it as a proactive measure to try to control it and I think that’s a mistake,” he said. “I’d rather they lag behind a little bit than innovate into the void.”
“That’s a lot of money,” Codding added. “I’d rather see that go into hiring more faculty.”
Cal State is spending big bucks on AI tools while facing a $2.3 billion budget gap is just “crazy,” he noted.
In the first half of 2025, CSU paid nearly $1.9 million to make ChatGPT Edu — OpenAI’s university-specific version of the chatbot — available to 40,000 users.
Since then, the system has expanded the contract by an additional $15 million to cover roughly 500,000 students and faculty through July 2026, according to public records, LAist reported last year.
“I think providing individual AI accounts is overkill. I’m a big fan of tech,” Codding said. “But using public money to support private enterprise, I still think there’s a problem with that.”
Another parent, who has three children attending USC, UC Berkeley and UCLA, also slammed the high cost of the AI tools.
“I would not like millions being spent on it. I don’t think that is correct,” mom Saba Haseeb said in an interview.
Haseeb said public universities should invest their money in human resources, not just artificial intelligence.
“If they’re replacing professors with AI, then tuition should be looked into, because a lot of tuition goes toward professors’ incomes,” Haseeb said.
Having raised one doctor and a lawyer, with another child preparing for medical school, Haseeb said universities should be more transparent about how new technologies are funded and used.
“It would be nice if they made the public aware that some of the funding will be used for things like AI and ChatGPT,” she said. “Parents should be involved to a certain degree — at least informed — about how this is going to be used and implemented.”
UC Berkeley did not provide the individual cost breakdown for each of the AI tools when asked by The Post.
“AI tools are included in previously licensed subscriptions,” a spokesperson said. “The Google Gemini app and Zoom AI Companion are tools that are included through UC’s agreements with Google and Zoom.”
The university has 33,122 undergraduate students and 13,029 graduate students. All students have access to AI features in tools already available to them.
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