Baseline Commitments

Financi​a​l Aid

The State University Grant (SUG) program is the CSU’s primary institutional aid, providing need-based awards to eligible students. The budget plan includes an additional $54.6 million for SUG due to a tuition increase, ensuring students with the greatest financial need are not impacted by the tuition increase scheduled for 2025-26. The SUG program has grown significantly, from $4 million in 1982-83 to a projected $823 million in 2025-26, with 9% of the CSU’s total operating budget dedicated to this aid.

In 2022-23, the CSU provided over $1 billion in institutional aid, including $716 million for SUG. Additional student support came from the state Cal Grant program ($754 million), the Middle-Class Scholarship Program ($419 million) and the federal Pell Grant program ($997 million). These aid programs help reduce attendance costs, allow nearly two-thirds of CSU bachelor’s degree recipients to graduate with zero loan debt, and keep remaining CSU student debt lower than state and national averages. In 2022-23, CSU graduates had an average debt of $17,346.

Health Premiums

Permanent base budget costs associated with January 2025 employer-paid health care premium increases are $60.3 million, reflecting an 8% increase in costs. Health care premiums are shared between the CSU and its employees, with the CSU funding a significant portion of the costs. The CSU is governed by California Government Code Section 22871, which defines the employer-paid contribution rates.

Maintenance of New Facilities

The CSU is scheduled to open 296,528 square feet of new facilities in 2025-26. The cost to fund regular maintenance of these facilities is $23.60 per square foot, for an additional $7 million in 2025-26. Regular maintenance of new facilities includes the cost of utilities, building maintenance, custodial, landscape and administrative support.

Liability and Property Insurance Premiums

The CSU estimates a $10 million increase, equivalent to a 9% increase, related to property and liability coverage. Insurance premiums continue to rise across the country and more so for California public entities. Without the additional funding, the CSU must redirect existing resources to cover the increase to this required operating cost.

Utilities

CSU utility cost increases are $31.7 million, equivalent to a 24% increase, as utility rates continue to climb. This increase reflects changes in both electric and natural gas rates. If the additional budget request is not met, universities must redirect existing resources to pay for the increased utility costs.