Campus Budget News

Campus Budget FAQ Archive 5/2011

Posted January 7, 2011 / ARCHIVED May 16, 2011

This FAQ will be updated on an ongoing basis as new information becomes available. Newly added information will be denoted by an asterisk (*). Past FAQs have been archived and can be accessed from the Campus Budget News page.

Please note that some of the questions and answers from the previous FAQ first posted October 12, 2010 have been slightly updated and carried over into this current document. Information new to this FAQ is denoted by an asterisk (*). 

ADDITIONAL QUESTIONS? If you have a question that is not answered by this FAQ, you may submit your question to budgetnews@csun.edu. (We also encourage campus employees to consult and share their concerns with their supervisor, unit head, dean, or division vice president.) We cannot respond to individual questions at this time, but will update the FAQ as appropriate to ensure that the common concerns of campus community members are addressed.

THE STATE AND CSU BUDGETS, 2011–12

Q: What do we expect for the 2011-12 budget?

UPDATED 1/10/11: On January 10, 2011 Governor Jerry Brown released his 2011-12 state budget proposal, calling for a $500 million reduction in state support for the California State University, equal to an 18 percent reduction. The proposed $2.29 billion in state support for the CSU for 2011-12 is equivalent to 1999-2000 levels, the lowest in twelve years, even though the CSU system currently serves nearly 70,000 more students. The proposed reduction is in response to an anticipated $28 billion budget deficit in the state.

The proposed $500 million reduction in state support for the CSU is a “best case” scenario based on an extension of the personal income and state sales taxes due to expire at the end of the 2010-11 fiscal year and a vehicle license fee the Governor hopes voters will approve in a June 2011 special election. Voter approval would provide a projected $10 billion in revenue for California. If voters reject the tax extensions, the CSU will face additional cuts.

Overall, the governor’s budget proposal reduces state support for all of California’s higher education institutions by $1.4 billion. The University of California (UC) is also facing a proposed $500 million budget reduction, and $400 million is proposed to be cut from the California Community Colleges.

Chancellor Reed has stated that: “As we have before, [the CSU] will need to look at every option in order to develop a comprehensive plan to address a reduction of this magnitude. There will inevitably be difficult choices as we move forward, and no single solution will be enough to meet this challenge.”

The Governor's January budget proposal is annually revised in May based on updated revenue projections and a budget is supposed to be adopted by the Legislature by June 15. The 2011-12 fiscal year begins July 1, 2011.

UPDATED 1/18/2011: For more information, please see the communication sent to faculty and staff members on January 18, 2011 by President Koester.

UPDATED March 2011: The Cal State Northridge portion of the $500 million budget reduction to the CSU in the Governor's budget proposal is currently estimated by the CSU Chancellor's Office to be $21,145,000. This is net of additional revenue projected from the 10% increase in student tuition fees to take effect for the 2011-12 academic year. 

Additionally, the CSU announced that in addition to reduced funding there will be $50 million in increased mandatory costs. These mandatory cost increases include increased energy costs and increased employee health premiums. Based on historical allocations, we estimate that Cal State Northridge's portion of this additional $50 million in cuts will be 7% or $3.5 million. Thus, as a "best case" scenario, the estimated net reduction in state funding for Cal State Northridge for 2011-12 is approximately $24.6 million.

UPDATED 4/21/11: For updated information on the 2011-12 state budget, including the impact for Cal State Northridge and considerations for meeting the budget reduction, please see the budget message sent to faculty and staff members on April 21 by Tom McCarron, Vice President for Administration & Finance and CFO.

Q: What happens if the Governor cannot secure the necessary Legislative votes to place tax extensions on the June ballot, or voters do not approve them?

On March 29 Governor Brown announced that he has abandoned efforts to secure the Legislative votes necessary to place a tax extension on the June ballot. The Governor has previously stated that the CSU and other public higher education institutions will face additional cuts in state funding if the Legislature or the California voters do not approve the tax extensions (vehicle license fee, sales tax and income tax) that were part of his January budget proposal.

Various governmental spokespersons have estimated that, in the absence of tax extensions, the additional reduction in state funding for the CSU may range from $500 million to $700 million, bringing the anticipated total reduction in state funding to $1.0 billion to $1.2 billion, a reduction of more than 35 percent as compared with 2010-11.

It should be noted these amounts are speculative and no formal allocation has yet been made for either the CSU or the Cal State Northridge campus. More information will be provided as it becomes available.

THE STATE AND CSU BUDGETS, 2010–11

Q: What does the 2010-11 state budget provide for the CSU?

On October 8, 2010, state lawmakers approved a 2010-11 state budget that restored $199 million to the California State University system and provided an additional $60.6 million for enrollment growth. More information is available at: http://gov.ca.gov/.

The $199 million restoration to the CSU served to back-fill part of a “one-time cut” of $305 million made to the CSU’s 2009-10 General Fund base. The additional $60.6 million funds enrollment growth across the system. (For background information, see “Governor’s January Budget Proposal and May Revise” section of the FAQs archived 10-12-10.)

The CSU also received $106 million in one-time Federal stimulus funding. This one-time money allowed the CSU to use monies from state support and student fee revenues previously set aside for payroll to admit new students and restore courses earlier cut due to budget reductions.

The 2010-11 budget increased the CSU’s General Fund support from $2.35 billion in 2009-10 to $2.62 billion, and represented the first restoration of state funding to the CSU since 2007. The 2009-10 level of state support was the lowest for the CSU since 1999-2000 ($2.25 billion), and although the CSU received increased state funding this year, the level of support is still at approximately 2005-06 levels ($2.62 billion). Further, the CSU faces fiscal obligations including mandatory cost increases for health care benefits and energy that the General Fund increase will not cover.

UPDATED 11/4/2010: For more information relevant to the CSU budget and California State University, Northridge, please see the communication sent to faculty and staff members on November 2, 2010 by Tom McCarron, Vice President for Administration and Finance.

Q: What specifically does the 2010-11 state budget mean for Cal State Northridge?

The state budget for the 2010-11 fiscal year provided $366 million to the CSU which was not in the 2009-10 budget and represents partial reinstatement of previously reduced state appropriation. The total is comprised of $106 million in one-time Federal stimulus money and $260 million intended to be recurring in subsequent years’ base budgets. However, the $260 million portion depends in part on the CSU achieving a new higher enrollment target of 338,507 FTES. If the CSU does not achieve this enrollment goal, a portion of this money must be returned to the state. The state plans to backfill the $106 million in one-time Federal stimulus money in the 2011-12 budget, converting this one-time funding to base budget.

Usually the Cal State Northridge portion of increases to the CSU budget is seven percent. However, this year the Chancellor’s Office held $100 million centrally in the anticipation of three possible contingencies: in the event that the enrollment target is not met and the CSU must return money to the state, in the event of a mid-year budget cut, or in the event of a budget cut for 2011-12.

Based on allocations from the Chancellor’s Office and achieved enrollment, Cal State Northridge has approximately $4.3 million in new base budget money and approximately $9 million in one-time funding to be expended this year. Prior to receiving this funding and in anticipation of budget reductions for 2010-11, President Koester had directed a 5 percent budget reduction to all divisions. These budget reductions to the divisions have been rescinded. Further, because the Cal State Northridge enrollment target was increased, the Academic Affairs Division will not see budget reductions due to enrollment reductions.

Allocation of the $4.3 million in recurring funding will include: $800,000 to Academic Affairs and Student Affairs for support of initiatives to improve graduation rates (such initiatives were funded last year through Federal stimulus funds), $500,000 set aside centrally as a safety net for operations of the Valley Performing Arts Center, and $3 million to increase the University’s operational reserves from $2 million to $5 million.

Allocation of the $9 million in one-time funding will include: $2 million for professional development for faculty and staff, allocated pro rata to the University divisions; $2 million for additional student employment; $2 million for technology infrastructure projects that are not part of IT’s ongoing budget (such as improving wireless access in classrooms); and $3 million for deferred physical maintenance projects (priority will be given to those most needed, for which other types of money cannot be used, and including some associated with visible improvement).

In addition to the 50-60 new faculty searches already underway, the President further committed funds from the 2011-12 budget for an additional 50 faculty searches.

Q: I have read there will be change to pensions as a result of the state budget. Is this true?

The 2010-11 state budget includes pension reform that will affect state employees hired January 15, 2011 and later, including CSU employees. The forthcoming changes do not apply to employees hired before that date.

Q: Will there be additional student fee increases?

During the summer of 2010, the CSU Board of Trustees approved a 5 percent student fee increase for undergraduate, graduate, and professional programs which took effect for the fall 2010 semester. This 5 percent fee increase was based on the Governor's January budget proposal, which assumed a 10 percent fee increase, and was linked to the Legislature's intent to "buy out" the remaining 5 percent for a total increase of 10 percent. However, the 5 percent "buy out" was not implemented.

UPDATED 11/10/10: In the absence of a “buy out” as discussed above, the CSU Board of Trustees approved a two-step fee increase at their November meeting to sustain enrollment, classes and services for current students. 

The Board of Trustees approved a mid-year increase of 5 percent for 2010-11 effective for the spring 2011 semester. The increase raised student fees by $105 per semester for undergraduate students, $123 per semester for credential program students, and $129 per semester for graduate students. State university fees increased from $2,115 to $2,220 for the spring 2011 semester for full-time undergraduate students.

In addition, the Board of Trustees adopted a 10 percent annual increase for the 2011-12 academic year. The Board of Trustees requested state funding to "buy out" the proposed 2011-12 fee increase by providing adequate funding in the 2011-12 budget. If approved by the Governor and Legislature, these funds would make it possible for the CSU to rescind the fee increase. Without the state "buy out," full-time state university fees will increase effective fall 2011 by $444 per academic year for undergraduate students, $516 for credential program participants and $546 for graduate students. Undergraduate fees will rise from $4,440 to $4,884 per year. The fees for the Education Doctorate program are linked by law to the University of California graduate student rate.

One-third of revenue from these fee increases are set aside for financial aid. Approximately 50 percent of CSU undergraduate students will not experience the fee increases because of financial aid. The planned 2011-12 fee increase will generate approximately $121.5 million in revenue (net of financial aid) for the CSU to enable provision of adequate course sections and student services. 

 UPDATED 1/28/11: On January 25, 2011, the CSU Board of Trustees approved a 10 percent increase to the tuition fee for Doctor of Education (Ed.D.) programs for the 2011-12 academic year. Beginning in fall 2011, tuition fees for Ed.D. students will increase by $954 annually to $10,500 per year. California law permits the CSU to increase the education doctorate tuition fee to the level adopted by the University of California (UC) system, which for 2011-12 is $11,064. However, the 10 percent fee increase approved by the CSU Board of Trustees is consistent with increases set for undergraduate and other graduate students for fall 2011.

ENROLLMENT MANAGEMENT AND ADMISSIONS:

Q: What is the enrollment target for 2010-11?

As the budget situation for the CSU changed, the 2010-11 enrollment targets for the CSU and Cal State Northridge were increased.

The 2010-11 CSU systemwide target was originally set at 310,317 FTES. It was then increased to 317,708 with the receipt of Federal Stimulus money. The CSU systemwide enrollment target was further adjusted to 323,994 on September 27, 2010 and to 338,407 on October 13. Concurrently, the enrollment target for Cal State Northridge was increased from 22,946 to 23,575 (with the receipt of Federal Stimulus money), to 24,226 (September 27), and most recently to 25.461 (October 13).