2011-2012 Executive Summary

Revenue Forgone

State University Grants (SUG) and Tuition Waivers—Revenue Forgone

Revenue Forgone The State University Grant program is unique to the CSU and is a critical source of grant assistance for CSU students. Since its inception in 1982/83, the State University Grant program has provided needbased grants to cover the cost of mandatory systemwide tuition and to offset the impact of increased charges for students with the greatest financial need.

Prior to 1992/93 the state provided funds for the SUG program to ensure adequate grant assistance was available for the CSU’s neediest students. Since 1992/93, the CSU has continued grant assistance to these students by forgoing one-third of annual revenue increases from tuition.

The amount projected for 2011/12 SUG from tuition revenue is $472.5 million, an increase of $22.7 million from 2010/11. The SUG adjustment is due to a one-third set-aside from tuition revenue derived from 2.5 percent enrollment growth (estimated 2011/12 marginal cost of $1,080 per FTES) and the full-year effect of the 2010/11 mid-year tuition increase.

Under current law, there are three state-mandated tuition waiver programs: the California Veterans Waiver for children of disabled/ deceased veterans (Education Code 66025.3), the Alan Pattee Waiver for dependents of deceased law enforcement or fire suppression personnel (Education Code 68120), and the tuition waiver for California residents who were dependents of victims killed in the September 11, 2001, terrorist attacks (Education Code 68121). In addition to statemandated tuition waiver programs, other tuition waiver programs are dictated by agreements in the collective bargaining process and include waivers for employees and employee dependants and graduate and teaching assistants. Other nonmandatory waivers have been established by CSU Board of Trustees policy and California statute that include programs for high school students and California residents age 60 years and older among others. The state has not provided General Fund support for CSU tuition waiver programs since fiscal year 1992/93.

The following is a three-year summary of the total revenue forgone and applied to State University Grants and mandatory waivers from 2009/10 through 2011/12.

  2009/10 Actuals 2010/11 Budget 2011/12 Budget
State University Grants (SUG)1 $397,926,000 $431,038,000 $431,038,000
Estimated Cumulative SUG Adjustments   $18,717,000 $41,463,000
Tuition Waivers $41,407,000 $45,062,000 $45,062,000
Total SUG and Tuition Waivers—Revenue Forgone $439,333,000 $494,817,000 $517,563,000
1An additional $33.8 million for SUG is funded by GF appropriation. This funding level has not changed since 1992/93.

In the 2009/10 college year (fall, winter, spring and summer), 11,932 mandatory tuition waivers were granted to CSU students. When state university tuition rates are applied to these waivers based on student enrollment status, it amounts to over $41 million in revenue forgone to the CSU. When the 2010/11 tuition rates are applied to these numbers, the level of revenue forgone rises to over $45 million.

2009/10 Systemwide Waivers Graph
2009/10 Systemwide Waivers
California Veterans 5,498
Alan Pattee 314
Employees and Dependents 3,248
Other Discretionary Waivers 1,034
High School Students in Special Programs 1,838