For the first time in five years, the California State University system will begin the fiscal year without facing devastating cuts in state funding.
During the last four years alone, funding for the CSU system has been slashed by nearly $1 billion. However the new state budget, signed into law June 27, not only evades direct cuts to higher education, but also secures a tuition freeze for both the CSU and University of California systems.
However, this budget relies on the passing of Gov. Jerry Brown’s proposed revenue ballot measure in November, which seeks to temporarily increase the state income tax for those earning more than $250,000 a year. If the initiative passes, CSU and UC systems would receive $125 million each in additional funding if they freeze tuition rates.
“My revenue proposal is fair and temporary,” Brown said in a statement about his initiative. “Our state budget problem was built up over a decade, and it won’t be fixed overnight. These temporary increases will ensure funding for our schools until the economy improves.”
The UC system has agreed not to seek a tuition increase, but the situation is more complicated for CSU schools. The Board of Trustees voted to increase tuition by 9 percent in the fall and has already begun collecting the increased rates from students. The tuition increase is expected to generate $132 million, which would leave a $7 million gap if the board decides to reverse the tuition increase and refund students. CSU officials said the issue will likely be discussed at the next board meeting on July 17.
Though the CSU has not declared an official position on the measure, the California Faculty Association strongly endorses it, stating if the initiative is not successful, things will be “measurably worse for the students in the CSU.” The CFA has issued a statement urging CSU officials to join it in endorsing the tax measure.
Days before the budget was signed into law, Chancellor Charles B. Reed released a statement urging legislators to reach an agreement on the budget.
“Time is short. I urge the members of the legislature … to reach agreement with the governor, whose plan is the only way forward to solve the state’s fiscal crisis and protect higher education from devastating further cuts,” Reed said.
If the measure does not pass, both the CSU and the UC systems will both receive additional cuts, potentially leading to more tuition increases. According to a CSU press release, if the measure is defeated, state funding for the system would fall to $1.8 billion—the lowest amount in 17 years.
“We are preparing for both scenarios,” San Diego State Media Relations Manager Gina Jacobs said. “If it passes, we will not need to make any further cuts. If it does not, we have a plan in lace to respond to the additional mid-year cut.”
Initially, the trigger cut was projected to be $200 million for each system. As a result, SDSU anticipated to take a $13.4 million cut. With the additional $50 million, however, it is unclear what SDSU’s share of the cut would be, according to Jacobs. She added that the university hopes to cover any remaining deficits with the use of one-time funds from its reserves.
In addition to preparing for possible future cuts, all 23 CSU campuses are still struggling to offset ongoing structural deficits since the CSU budget was cut $750 million just last year.
Members of the CSU Board of Trustees Finance Committee on presented several cost reduction strategies last month, such as consolidating administrative services, implementing higher tuition for certain campuses or programs, increasing class sizes and reducing faculty pay or even closing campuses, though CSU officials said the latter option is not currently on a consideration.
But moving forward with an all-cuts budget would mean severe reductions for California campuses. To avoid eliminating thousands of positions, reducing enrollment and discounting certain other programs, the committee also proposed revenue-generating options. These include increasing tuition for nonresident and graduate students and adding fees for repeated classes.
As a way to mitigate the existing financial damages, SDSU has implemented several of its own cost-saving measures, including eliminating 950 state-funded positions since the 2007-08 academic year, according to Jacobs.
“We will continue to identify areas that can be made more efficient through a strategic use of resources, but we are also looking for more ways to produce additional revenue,” Jacobs said.