A Message from President Milton A. Gordon
July 23, 2009
To The Titan Family:
I am writing to provide you with an update on the state budget situation and its impact on The California State University system and our campus.
As many of you may know, the state legislature and Governor failed to meet the June 30th deadline for completing the 2009-10 budget, but the legislature and the Governor now appear to be getting closer to finalizing the 2009-10 budget for the state that is expected to result in a $584 million budget deficit for the CSU. Although the outcome of the state budget process still remains uncertain, the CSU Board of Trustees on Tuesday, July 21, 2009 finalized a plan to manage a $584 million budget deficit to the CSU that includes furloughs for employees, a fee increase for students, and enrollment reductions for the next two years.
The budget deficit, the largest in the CSU’s history, is the result of the state’s reduced support to the CSU in the face of California’s $26.3 billion budget gap.
The CSU for the past several months has examined every option to deal with the budget deficit as no single solution will solve the magnitude of this budget reduction. Aiming for a balanced approach that attempts to serve as many CSU students as possible and preserve as many jobs as possible, the CSU Board of Trustees approved a four-pronged plan that includes the following:
- Student Fee Increase: Fees will increase $672 for full-time undergraduate students and $828 for graduate students in fall 2009. There will also be a $990 tuition increase for full-time non-resident students. CSU undergraduate students will pay approximately $4,827 per year (which includes an average campus fee of $801), the lowest fee among comparable institutions.
One-third of the fee increase will be set aside for financial aid. This set-aside, as well as increases in financial aid included in the federal stimulus package, is expected to fully cover the fee increase for 187,000 of CSU’s 450,000 total students. The CSU also expects to receive an additional $81 million in Pell Grant awards for its neediest students. The CSU is the largest recipient of Pell awards in the country with more than 120,000 students receiving grants. In addition, federal tax credits, increased work study and student loan improvements will also offset the fee increase for many students. Including financial aid, families who make $75,000 or less will not pay any fees. Financial aid and federal tax credits will also be available for many other students, including those with family incomes of up to $180,000. - Student Enrollment Changes: The CSU will reduce enrollment by 40,000 students over the next two years and has closed enrollment for winter and spring 2010 in attempt to enroll only as many students for which the state provides funding. In addition, to increase space for new students, the CSU Board of Trustees also approved changes to state regulations that will preclude students from enrolling in courses once they have met all the necessary degree requirements by allowing campus presidents to confer their degree.
- Employee Furloughs. The CSU Board of Trustees also approved changes to state regulations that will allow management and non-represented employees to be furloughed two days per month beginning August 1, 2009. Employee salaries and benefits make up 85 percent of the CSU’s operating budget and the CSU has proposed to furlough all 47,000 of its employees (except public safety personnel) to reduce spending by $275 million and to preserve jobs.
The CSU is in the process of negotiating furloughs with several of its labor unions as their labor agreements do not include provisions for furlough. The California State University Employees Union (CSUEU), representing 16,000 non-academic employees, and the United Physicians and Dentists (UPD), with 117 members, have ratified a furlough agreement. The California Faculty Association (CFA), which represents 23,000 employees, is polling its members on a furlough option with the results expected after July 22, 2009. The CSU is in the process of negotiating furloughs with the Academic Professionals of California (APC). The remaining unions have opted for layoffs per their contracts.
The CSU, since early June, has been attempting to negotiate furloughs with all of its unions for an August implementation. Accordingly, Chancellor Charles B. Reed announced on July 21, 2009 a deadline of July 28 at 5:00 p.m. for those unions who have not reached a final agreement on furloughs so campuses have time to prepare for the new academic year which begins August 24. - Operations: Even after accounting for expenditure reductions from employee furloughs and revenue from the student fee increase, CSU campuses and the Chancellor’s office will be asked to cut an additional $183 million from their 2009-10 budgets. The CSU has already implemented a number of cost cutting measures including a salary and hiring freeze and travel and purchasing restrictions.
What Does This Mean for California State University, Fullerton:
CSUF has no choice but to take steps now to bring our budget in line with a projected $584 million deficit in funding to the CSU which is expected to create a $36.7 million shortfall in CSUF funding for 2009-10.
A decrease of this size will have significant effects on the operation of the campus, and bring fundamental changes to the way we do business. I am working with my President’s Administrative Board, the Planning Resource and Budget Committee, the Academic Senate, Associated Students, Inc. as well as other campus advisory bodies to address this significant reduction to our budget. Because of the state’s ongoing fiscal crisis, CSUF has aimed for a balanced approach to provide as many students as possible with the best education and collegiate experience possible and preserve as many jobs as possible. To that end, we are taking the following steps for 2009-10:
- As a result of the CSU student fee increases approved by the CSU Board of Trustees, CSUF undergraduate student fees will increase from $3,658 (2008-09) per year to $4,662 (2009-10) per year, and there will be comparable fee increases for graduate, credential and non-resident students. One third of the fee increase will be set aside for student, need based scholarships.
- We have reduced admissions for fall 2009, and are expecting 1,200 fewer college-eligible community college transfers and first-time freshmen will enroll this fall.
- We have cut summer school enrollment for 2009 by 38%, from 10,500 (Summer 2008) to 6,500 (Summer 2009).
- We have instituted a salary and hiring freeze for non-essential positions, as well as travel and purchasing restrictions.
- In accordance with the CSU plan to cut enrollment by 40,000 students over the next two years in an attempt to enroll only as many students for which the state provides funding, California State University, Fullerton has closed spring 2010 undergraduate admission, for an additional reduction of approximately 2,000 students in spring 2010 enrollment.
- The CSU is in the process of negotiating furloughs with several of its labor unions as their labor agreements do not include provisions for furloughs. The California State University Employees Union (CSUEU) and the United Physicians and Dentists (UPD) have ratified a furlough agreement with the CSU. The California Faculty Association (CFA) is polling its members on a furlough option with the results expected after July 22, 2009. The CSU is in the process of negotiating furloughs with the Academic Professionals of California (APC). The remaining unions have opted for layoffs per their contracts.
The campus is in the process of developing a specific furlough plan which must be approved by the CSU before implementation. It is anticipated that once approved by the CSU, the furlough plan will begin in August 2009 and at the present time will apply to Executive and Management Personnel Plan employees, non-represented employees, CSUEU employees on campus, and the United Physicians and Dentists (UPD) employees on campus. Workshops will be offered by Human Resources and further emails will be distributed to the campus community once the furlough plan is finalized and approved by the CSU. - In addition, we will continue to remain alert to other cost saving measures, as we continue the challenging task of aligning operating expenses with our diminished state funding.
Despite the challenges we face, I am confident that the Cal State Fullerton university community will pull together to continue providing a quality education to the students we serve and to support the regional economy with graduates that are ready to be productive members of the workforce.
Milton A. Gordon
President
