Chancellor's Communication-October 29, 2001


October 29, 2001
TO:         All CSU Employees
FROM:    CSU Chancellor Charles B. Reed
RE:         CSU Update

Since the last time I wrote to you, on August 28, world events have brought about many changes and uncertainties. One thing, however, is abundantly clear. No terrorist can destroy what makes our country and our university system great. I am proud of the manner and spirit in which all of you responded to the attacks of Sept. 11th . You showed great compassion and respect for the victims of this tragedy, and you demonstrated strong resolve in continuing to carry out our mission of educating California's students. Thank you all for your caring and determined response.

As we move forward, we can be sure of this: Universities will have a critical role to play in the future. That's because our society will have a greater need than ever for the knowledge and understanding that education provides. People will look to universities for more opportunities to study languages, religions, cultures, and communications. Employers will need more graduates who are well-prepared in engineering, science, business, nursing, agriculture, and architecture. Schools will need more high-quality teachers who understand the special needs of today's classrooms. Our university system, and each one of us, truly has an important job to do for the future.

In the meantime, we face many challenges that will require us to be stronger and more focused than ever. Earlier this year, the state's economy had begun to slow down. But Sept. 11th put what might simply have been a slow economic period into an economic freefall. The state's budgetary outlook for this year, and perhaps for the next year and even the year after that, is grim. Governor Davis has said that the state could face a budget deficit as high as $14 billion, and he has asked all state agencies to submit proposals for reducing their budgets by 3, 5, 10, and 15 percent from the current year. On Oct. 23, he issued an executive order directing state agencies to put in place a hiring freeze and to make certain budget cuts. The University of California and the CSU have been asked to consult with the Department of Finance on our current year funding and hiring. While nothing is certain just yet, I know we will feel the crunch.

In fact, the CSU is already feeling the crunch, at least indirectly, through its enrollment increases. During times of economic hardship, more students choose to stay in school and many workers return to higher education. We are seeing evidence of this trend all over the state. Preliminary estimates for this fall show that the CSU is 2.3 percent over its funded enrollment targets, which means that we have about 7,700 more full-time equivalent students than we had anticipated who are not funded in our current budget.

Now I realize that all of these numbers do not paint a very pretty picture. But while we have to be realistic about the present, I also believe that we can be optimistic about the future. As I mentioned, people are relying on higher education now more than ever. I believe that we can pull through these tight budgetary times and keep our quality high as long as we remain focused on our top priorities:

  • Providing high-quality education for our current students;
  • Maintaining our commitment to meeting our enrollment growth challenge;
  • Improving compensation and benefits to create the best possible working environment for our employees;
  • Increasing private voluntary support for our campuses;
  • Expanding and updating our technology systems and improving libraries;
  • Building and maintaining our facilities.

None of us -- a chancellor, a president, a faculty member, or a staff member -- can accomplish these goals alone. We all share the responsibility of carrying out the mission of the California State University. But I know that as long as we focus on these priorities together, we can be successful in building and sustaining quality at the CSU.

With all of the above priorities in mind, the CSU's Board of Trustees last week approved a 2002/03 CSU budget request that calls for full funding of the CSU's partnership agreement with the governor. That agreement, reached in May 2000, called for specified annual funding increases for enrollment and compensation.

The budget request recommends a $245.4 million, or a 9.4 percent general fund increase over 2001/02. It proposes an additional $132 million for enrollment growth and enrollment-related services, with projections for a 4 percent increase in enrollment for 2002/03. It also calls for an additional $89.5 million for a 4 percent compensation increase for CSU employees.

Clearly, as a state university, we must operate within the realities of the state's budget. But the Board and I will be doing everything that we can, in Sacramento and around the state, to make sure that the CSU has the resources we need to accomplish our mission.

For more information about the CSU's 2002/03 budget request, please see: The next major step in the process is scheduled to come in January, when the governor submits his 2002/03 budget to the legislature. If any significant budget developments occur in the meantime, I will pass that information along to you.

As always, you are welcome to e-mail me your feedback and questions about this message at While I am unable to respond to each message individually, I will post the answers to the most frequently asked questions on our website. We will post them no later than Nov. 13 at We keep these messages, your questions, and the responses on this page so that you can view them at any time.

Thank you again for all that you do to make the California State University an outstanding institution.

last updated October 29, 2001