Budget Central

 

President’s Open Forum Message

Dear Colleagues,

At a campus budget open forum held this afternoon, I discussed the latest information on pending budget reductions to the California State University (CSU) system and outlined the collaborative and transparent process CSU Stanislaus will follow to prepare for reductions to our 2011 – 2012 base budget — the third consecutive reduction to our funding in as many years. I recognize and share your concern about the impact additional cuts will have on our students and campus community. I am committed to addressing your concerns by keeping you as informed as possible as the situation changes. My discussion from today’s forum is summarized below.

State Budget Developments

One week ago, a legislative budget conference committee charged with reconciling the differences between the Assembly and Senate version of the state budget bill confirmed Governor Brown’s proposed $1.4 billion cuts to higher education. These cuts represent a $500 million reduction to the CSU, and would return the system to the same level of funding it received in 1999 when the CSU served 70,000 fewer students. The current proposal amounts to an approximate 18 percent funding reduction to the CSU, following previous reductions of eight and 20 percent in recent years.

The annual California state budget process has been expedited to meet the governor’s request for a completed budget by March 10, 2011. The CSU expects to receive its initial 2011 – 2012 budget from the state by mid-March. After that, our campus will receive additional details with regard to our specific budget reduction target from the CSU.

Proposed California Voter Approval of Tax Extensions

Governor Brown has proposed a June special election to seek voter approval of an extension of temporary increases to personal income tax, sales tax and vehicle license fees due to expire June 30, 2011. Based on current estimates, these tax extensions would provide over $10 billion in revenue to help the state close an estimated $26 billion budget deficit. However, the governor has clearly stated that none of these additional revenues would be used to offset his proposed reductions to higher education. Most importantly, the $500 million reduction to the CSU is a best-case scenario, because it is contingent on legislative support to place tax extensions on the ballot and voter approval. A significant additional budget reduction to the CSU is likely should the taxes be allowed to expire at the end of June.

CSU Stanislaus Budget

Our campus has absorbed budget reductions of $6.2 million in fiscal year (FY) 2008 – 2009 and $4.1 million in FY 2009 – 2010. These reductions have been painful, and reduced our operational budgets and service levels to “bare bones.” We can clearly state that in a $500 million reduction scenario, the Stanislaus campus portion will likely be 2.2 percent of that amount. (CSU Stanislaus represent 2.2 percent of the CSU budget). That equates to an $11 million reduction to CSU Stanislaus, minus $1.4 million (the previously approved 10 percent tuition increase for Fall 2011) for a reduction impact of $9.6 million. If we also apply all our savings—$2.5 million—the net reduction drops to $7.1 million. With the remote possibility that the total reduction to the CSU may be reduced to $400 million, the same assumptions about revenue and return of campus savings yield a net reduction of $4.9 million.

The CSU has set our enrollment target for next year at 6,715 FTES. This is up from last year’s target of 6,665 FTES. The expectation is that we will not reduce enrollment even in the face of projected budget reductions. Further, we must meet our target to ensure we do not lose additional funding.

Thus, our campus must begin planning now for permanent reductions to our state funding. Across the board budget reduction strategies will cripple all of our programs, so let me be clear: the magnitude of these budget reductions compel us to look beyond efficiencies and cost-cutting measures to entirely new modes of operation. Together, we must prepare not just for another year of budget reductions, but also for the new budget reality for the CSU and our campus.

CSU Stanislaus 2011 – 2012 Budget Planning Process

The University Budget Advisory Committee (UBAC) is the campus body charged with making campus-wide strategic budget recommendations to the president. The first meeting of UBAC, devoted to our 2011 – 2012 budget, was conducted earlier this morning. Using the values articulated in our strategic plan as a guide, I have asked UBAC to provide recommendations and proposed strategies to me by May 1, 2011.

I expect the UBAC to consider all possibilities and discuss several key areas where strategic change could result in substantial savings and position the campus for future opportunity:

1) Campus synergy activities

2) Administrative services and structures

3) Delivery of academic programs and services

4) Revenue generation

5) Opportunities for strategic investment


Point five may be surprising given the economic reality. However, just as we must think strategically when we consider expansion in good economic times, we must also think strategically about how to reinvest in the University in times of economic downturn. A reshaping of fundamental operations and structures and redirection of scarce resources toward maintaining quality student services, supporting faculty development and research, providing quality course offerings in high-demand fields, and assuring student access and success are essential elements of this reinvestment.

In addition, Provost Strong will engage the deans in ongoing discussions specific to each of the colleges. The deans will play a major role in meeting with their respective faculties and looking at different options and cost cutting measures, including course offerings, curriculum, departmental structures, and how to really deliver our FTE target and serve our students. The plans from the colleges, under the leadership of the deans and in full consultation with the faculty and staff of each college, are extremely important to this overall planning process. The deans will be asked to provide strategic recommendations to the Provost for dealing with substantial budget reductions, while maintaining our goal of providing a high-quality education to our students.

Summary

I believe you will find our budget planning process to be transparent and inclusive. The UBAC meetings are open, and I encourage you to visit our budget website for the full schedule and details on discussion items. In addition, you will find a comments and suggestions link on the CSU Stanislaus budget central page and an email address (budgetsuggestionbox@csustan.edu) to submit input. I encourage you to use these tools to provide constructive ideas and feedback.

Our region needs CSU Stanislaus more than ever, and I thank you for your devotion to our students and campus during these challenging times.

Regards,

Ham

Updated: 03/04/2011
California State University Stanislaus
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Turlock, California 95382

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