July 21, 2009

Student needs guide CSUMB budget planning

A focus on preserving student services and academic quality is guiding plans by California State University, Monterey Bay to close a $9.95 million revenue gap for the 2009-10 fiscal year, President Dianne Harrison said Tuesday, July 21.

CSU Monterey Bay will implement a student fee increase and employee furloughs that were approved Tuesday by the CSU Board of Trustees for all 23 CSU campuses.

Like the other campuses, CSUMB will not accept any new students for the spring 2010 semester, and its enrollment will remain at 2008-09 levels - about 4,200 students.

In addition, Harrison said, the university will continue its freeze on top administrative salaries, leave positions unfilled where possible and curtail spending on travel, equipment purchases and maintenance and repair. The university also plans to use some one-time reserve funds, she said.

As a result, efforts to continually improve and develop the 1,387-acre campus will be impeded, the average class size could grow, and the number of course sections available may be reduced, Harrison said. Plans for a new academic building to house the schools of business and information technology have been suspended.

The combined effect will be a slowing, not a halt, to CSU Monterey Bay's development on the former Fort Ord Army base, she said. The university now offers 18 bachelor's degrees and seven master's degrees, with additional degree programs in the pipeline.

"We are trying to build our programs and establish a comprehensive university for the 21st century," Harrison said.

CSUMB's final budget plan is still subject to legislative actions and further consideration by campus leadership. Classes begin Aug. 24 for the fall 2009 semester.

"We're determined to maintain our core student services and the core courses of our curriculum so students who are enrolled can have a quality experience in spite of these reductions," Harrison said.

"We are making very difficult decisions about what is essential and core to our program and what is in the best interest of our students."

Additional priorities are to maintain employment and ensure a safe campus environment, she said. Spending will be aligned with major goals in the university's new 10-year Strategic Plan: ensuring student success, becoming a comprehensive university, increasing institutional capacity and attracting and retaining outstanding staff and faculty.

Echoing remarks by CSU Chancellor Charles Reed last week, Harrison said a multi-pronged approach is needed to address the massive budget shortfall through a combination of increased revenue and reduced expenses. An expectation that California's budget crisis will continue into next year or beyond also dictated a foundational strategy, she said.

The entire CSU is facing an unprecedented $584 million revenue shortfall for this fiscal year, which began July 1. The gap results from steps to address California's $26.3 billion budget deficit.

"The level of the budget reduction is such that there isn't just one approach that will work to cover the deficit, so we're looking at multiple approaches," Harrison said.

Increased student fees and employee furloughs, still subject to union approval and negotiation, will partially cover the CSUMB budget gap. The remaining amount will be made up through other campus spending reductions and use of one-time reserves.

Many shielded from higher fees

The $672 system-wide increase in undergraduate student fees for the 2009-10 academic year is in addition to a $306 increase for this year adopted by the CSU Board of Trustees in May. The undergraduate State University Fee will go from $3,048 to $4,026 per year, still far lower than comparable public universities.

One-third of the system-wide fee increase, or $79 million, will be set aside for financial aid. At CSU Monterey Bay, where a majority of students receive some form of financial aid, an estimated 30 percent will not pay any of the additional fees thanks to increases in state tuition grants and federal Pell grants.

Across the CSU system, more than 187,000 students will be covered dollar-for-dollar through a mix of grants, fee waivers and newly expanded federal tax credits.

Furloughs with students in mind

Because approximately 85 percent of CSU budget costs are in salary and benefits, personnel expenses are an inevitable part of the budget strategy.

The Board of Trustee's action Tuesday means that all management employees, including the chancellor and campus presidents, will take 24 days of unpaid furlough days between Aug. 1 and June 30, when the fiscal year ends.

The California State University Employees Union, which represents 243 support and technical employees at CSUMB, said Monday its members have ratified a 24-day furlough plan, with 81 percent support. The California Faculty Association, which represents about 300 faculty and part-time instructors at CSUMB, said it will announce July 22 whether its members have voted to negotiate a 20-day furlough plan.

A furlough is a mandated period of time off without pay. Furloughs differ from salary reductions and pay cuts in that they are temporary and do not affect employment status, health benefit eligibility or pay rate for retirement benefits.

CSU Monterey Bay plans to establish furlough schedules to minimize impact on student services and instruction, Harrison said.

A cap on CSUMB enrollment

As a result of budget cuts, the entire CSU system is seeking to reduce enrollment by 40,000 students over the next two years, reducing access to incoming students in order to maintain quality and services for current students.

At CSU Monterey Bay, this has resulted in the spring enrollment closure and a cap on total enrollment. The university has grown steadily since it opened in 1995 on the former Fort Ord Army base, and its long-term enrollment goal remains 8,500 on-campus students by 2025.

Because of strong demand from students in the Monterey Bay region and elsewhere in California, the university this summer had to turn away qualified students for fall 2009 - a first in its 14-year history.

"It's a very difficult situation to be in," Harrison said, "because we pride ourselves on providing education that's accessible to as many students as possible."

About 34 percent of CSU Monterey Bay's students come from the tri-county area of Monterey Bay, San Benito and Santa Cruz counties. Among all CSUMB students, 44 percent have parents who did not attend college, and 28 percent are Latino.