Governorís Proposed Budget Reductions Include Mid-Year Cuts to CSU


(November 6, 2008) –In acknowledgement of the state’s worsening economic condition and sharp revenue decline, today Gov. Arnold Schwarzenegger called the Legislature into a special session to make spending reductions and revenue increases.  The Governor’s plan proposed further budget cuts of $66.3 million to the California State University for the current 2008-09 budget.

The proposed mid-year cut would come on top of the final 2008-09 budget that was $215 million below CSU’s operational needs for the fiscal year, and in addition to a previous one-time $31.3 million reduction.

 "We recognize that the state’s fiscal situation is increasingly deteriorating, but these potential mid-year cuts combined with reductions already made to our budget will result in fewer qualified students being admitted to our universities. I have been advocating that the state needs to increase revenues in order to offset continued deep cuts in higher education," CSU Chancellor Charles B. Reed.  "The CSU prepares the majority of California’s workforce, and these budget cuts will have a direct impact on the state’s economy if we are unable to provide graduates for California’s key industries."

"This also comes at a time when the CSU is experiencing a 20 percent increase in the number of applications we are receiving from students wanting to enroll next fall. Unfortunately, we will not be able to meet this demand without adequate resources."

To help close the gap, the Governor is proposing a combination of spending reductions totaling $4.5 billion and $4.7 billion in revenue increases to close an estimated revenue shortfall of $11.2 billion this year.

The CSU receives a total of $2.97 billion from the state General Fund and $1.5 billion from student fee revenue. This year’s budget provided no funding for enrollment growth, and or for mandatory cost increases such as energy and employee health benefits. CSU anticipates that further budget reductions will likely result in increased class sizes, fewer course sections, additional temporary instructors, and the scaling back of other services.



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.