State Budget Restrains Enrollment Growth at California State University


(September 23, 2008) - The new state budget provides the California State University system with essentially the same level of state support as last year. The final CSU budget consists of $2.97 billion from the state General Fund and $1.5 billion from student fee revenue. The budget is $215 million below CSU’s operational needs for 2008-09, according to the inflation and enrollment growth calculations by the Governor’s Department of Finance.

“We are appreciative of the Governor and Legislature for keeping intact our budget as presented in the May Revision, in spite of a worsened fiscal condition in the state,” said CSU Chancellor Charles B. Reed. “Although we still face a serious funding gap, the CSU is committed to preserving academic quality and academic programs that are of high priority for the social and economic well being of California.”

Continued Growth, Strained Funding
The budget provides no funding for enrollment growth intensifying a trend that began in 2005-06, in which student enrollment grows faster than state funding. In response, CSU campuses have increased class sizes when possible, and opened more course sections with temporary faculty appointments. To protect educational quality in the face of these funding challenges, CSU campuses will slow down enrollment growth by closing the freshmen application period for Fall 2009 earlier in the cycle.

 “Enrollment restrictions hinder the opportunities for students from all communities to obtain a college education,” Reed said. “The pipeline of students in K-12, is two-thirds students of color, who have a critical need to attend college. Many of these students will be negatively impacted if the State is unable to restore adequate funding for higher education next year.

“The enacted state budget avoids an additional $97.6 million of cuts that had been proposed last January,” Reed said, highlighting the collaboration of students, faculty, staff, administrators and alumni who under the Alliance for the CSU, advocated for full funding for the university system. “Their demonstrations at each of our 23 campuses and at the state capitol spotlighted the value of higher education for our state’s economy.”

Impact on Student Fees

To maintain high academic quality while absorbing state budget cuts, the Board of Trustees in May, agreed to increase the annual student fees as follows:  $276 for undergraduate students, $324 for teacher credential students and $342 for graduate students.  The 10 percent increase will generate approximately $73 million, after providing for additional financial aid to eliminate the fee increase for the neediest students.

Even with the increase, CSU fees continue to be among the lowest in the country. The undergraduate State University Fee was increased from $2,772 to $3,048 per year.  Including the approximate average campus fee of $749, CSU undergraduate students are paying approximately $3,797 for one academic year, which is less than the lowest fee of public institutions used to benchmark the CSU.

In the absence of a state funding increase, revenue from the fee increase must be used primarily for expenditures that the CSU must make in 2008-09 to meet various obligations, including escalating energy costs and employees’ health insurance premiums.

About the California State University
The California State University is the largest system of senior higher education in the country, with 23 campuses, approximately 450,000 students and 46,000 faculty and staff. Since the system was created in 1961, it has awarded nearly 2.5 million degrees, about 90,000 annually. Its mission is to provide high-quality, affordable education to meet the ever-changing needs of the people of California. With its commitment to excellence, diversity and innovation, the CSU is the university system that is working for California.

Last Update: September 23, 2008
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Contact: Clara Potes-Fellow
(562) 951-4800

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