The Legislature requested a study of the student-faculty ratio workload measure used by the University of California (UC) to determine if it results in excess instructional resources for the University. Following a statement of the purpose of the report, information on the background of the University's instructional resources formula is provided. Shifts in enrollment mix are discussed, and evidence from other states is included. Eight conclusions are listed, and from them two major recommendations are made: (1) the state should continue to fund faculty instructional resources in UC through its present formula budget approach, and (2) the state should establish a process for regularly reviewing the effectiveness of its formula for budgeting instructional resources in UC. Four appendices include: UC full-time equivalent conversion factor calculations and methodology; UC faculty workload policies; framework for considering instructional cost and resource issues at UC; and research literature on instructional costs and state formula budgeting methods. 18 references. (SM)