Public Affairs

Higher Education Leaders Testify Before Assembly Budget Subcommittee

Higher Education Leaders Testify Before Asembly Budget Subcommittee
California State University Chancellor Charles Reed describes the impact of the proposed budget on the 23-campus CSU system at an Assembly Budget Subcommittee Hearing. From left to right: University of California President Mark Yudof, CSU Chancellor Charles Reed and California Community Colleges Chancellor Jack Scott.

February 9, 2011

California State University Chancellor Charles B. Reed joined fellow California higher education leaders California Community Colleges Chancellor Jack Scott and University of California President Mark Yudof at an Assembly Budget Subcommittee Hearing Monday in Sacramento. The three leaders discussed the potential effects of proposed budget cuts of at least $1.4 billion on the three systems.

Reed declared his agreement with Governor Brown's decision to immediately address the fiscal problems with the state, but made the point that continued reductions in funding to higher education will reduce the rate of recovery by the state's economy, ultimately placing the future of California at risk. Reed stated that the reinvestment in higher education will drive the state's economic revival.

"California's economy depends on the CSU and the rest of higher education, in both the near term and the long term," Reed told the panel. "We are the engine of economic recovery and workforce development in the state."

The proposed state support for CSU in 2011-12 would reduce the CSU's budget to approximately the same level as in 1999-2000, though the CSU currently serves nearly 70,000 more students.

With a reduction of at least $500 million looming, the Chancellor indicated that a tuition increase passed by the CSU Board of Trustees this past November will alleviate some of the burden, but that mandatory costs including rising health care costs, as well as increases in energy expenses will cost the University an additional $50 million.

Reed also told the legislative subcommittee, "Given the enduring nature of the state's budget problem, we will also need to restructure programs. We can no longer justify offering practically every major at every campus when many of those majors have exceptionally low enrollments."

The CSU will continue a review of programs across the system to determine if some lower-demand programs could be offered on a regional basis with similar programs at nearby campuses. He cautioned that efficiencies will help partially address such a large cut in funding, but stated that the university must do much more in light of the magnitude of the proposed cuts. He cited the restructuring of business practices as a beginning point for this endeavor.

Chancellor Reed also declared that should tax extensions proposed by the governor be passed during a potential special election in June, the CSU will not pursue any additional tuition fee increases for 2011-12. He did leave open the option to revisit this strategy should the state not vote to extend the tax extensions or if the proposal does not reach the ballot, which would put the university at risk of even greater cuts.

Lastly, Chancellor Reed also requested that the legislature allow the CSU flexibility and discretion in the budget management process to best position the CSU to take advantage of future reinvestment by the state.