Chancellor's Recent Speeches

Remarks by Charles B. Reed
Chancellor, California State University
CSU Alumni Council 2009 Annual Conference
Friday, January 9, 2009
SFSU Downtown Center
San Francisco, CA

Thank you, Valerie (Vuicich from Fresno State, CSU Alumni Council chair).

It’s the no kidding rule. People say I am blunt, so let me begin by being as blunt as possible:
California is going to hell in a hand-basket – fast.

This state is rapidly descending into a fiscal mess of epic proportions.

The state’s General Fund provides two-thirds of the resources for the California State University, with student fees providing the remaining third. These are extremely trying times for the CSU family of students, staff, faculty and alumni.

The state’s $42 billion dollar, 18-month fiscal hole means tough times ahead. It will get worse before it gets better, and it actually may take five to ten years for the state to turn around.

That is why all of you in this room and all of your alumni colleagues are so important.

Today, I want to talk about what we all need and must do if the CSU is to maintain the quality education it provides to 450,000 current students and all our future students.

Besides talking about our challenges ahead, I also want to talk about the successes we have had this year, and our opportunities to continue to make a difference in the lives of families in this state.

State budget:

First, let me begin by talking about the state budget and where our CSU budget stands at this point. Everything, of course, is subject to change as the Governor prepares for his State of the State address on January 15 and the Legislature debates the latest budget proposal.

When you read the papers or the internet or listen to the radio, you hear every day that there is more bickering in Sacramento, and that nothing is resolved. It is like a playground – ‘he said that; no he didn’t’ …That kind of behavior is hurting this state and our university system on a daily basis.

Here’s a history lesson:

More than fifty (50) years ago, this state decided to invest in human capital – that means its people. The Master Plan for Higher Education came into being; the state’s highway system was expanded; the GI Bill and jobs were created for returning veterans.

There was a sense of optimism and faith in the future of this state. People worked hard to get things done. Now, California is living off its past rather than moving into the future. The baby boomers are retiring.

This state is no longer competitive – it keeps losing ground to other states and countries. We have moved from the sixth to the eighth largest economy. Our per capita income is decreasing significantly, and many of our communities are less hospitable places to live and work.

It may sound harsh, but California is becoming more like a third-world country than the Golden State it used to be. People can build all the gates around their communities they want, but in this poor economy, these gates will come down…

It is going to take someone to stand up and shout: California must be willing to raise taxes, to reform our governance system and to invest in its human capital. But who will do that?

I have said it before: this state is almost ungovernable.

  • Government is dysfunctional
  • Only one of three states that requires a two-thirds vote to pass a budget
  • Too many initiatives – starting with Proposition 13, then Proposition 98 – have created fiscal failures and locked up too much of the state budget
  • Bickering is more common that collaboration
  • Far too partisan
  • Too many people have entitlement mentalities
  • And term limits are erasing our institutional memories.

You can call it “Paradise Lost” in California.

Let me quote former Senate Leader Don Perata, who said last month in the Sacramento Bee: “There is no center. I’m not talking about political center. There is no action center, or moral center or anything else left in Sacramento.”

What has the California State University done in the face of all of this? Exactly what we are supposed to do.

During the past 10 years, we have been recognized nationally for our outreach efforts to the new population of California: the student of color, the first in the family to go to college, the underserved student. The CSU is 56 percent students of color.

We know that even with a budget crisis of this magnitude, we must continue to reach out to the next generation of Californians for our workforce.

We must get them and their families through high school, into college, graduated from college and into the workforce as successful contributing members of society.

Sixty-five (65) percent of the public school population falls into those categories, and they are our future. We cannot and will not let the state’s budgetary mess stop us from doing our job.

That is our challenge, and we accept it. Examples of what we do:

  • Super Sundays
  • Provide the bulk of the state’s teachers
  • Road to College tour
  • “How to Get to College” posters with financial aid and other information
  • Early Assessment Program (EAP)
  • PIQE
  • Troops to College
  • Graduate 92,000 students annually

The California State University is the system that produces the engineers, computer scientists, nurses, teachers, criminal justice practitioners, agricultural and entertainment experts and many others. We provide not only economic mobility to these populations, but we provide the social mobility needed to put this state back on track.

It is not the highly selective institutions that educate this population –it is the CSU.

Thirty-seven (37%) percent of CSU needy undergraduates receive Pell Grants. Only 8 percent to 15 percent of the students receive them at Harvard, Yale, Stanford and other highly selective research universities.

If the CSU fails to educate these needy students, these populations will remain in the underclass and our economy will falter, not grow.
We educate the new workforce; we invest in this state’s human capital. Now we need those in Sacramento to invest more in the CSU so we can continue to serve this state and its people.
Higher education has what everyone needs and wants. We add value to everything we do. People value what we provide to the economy:

  1. Workforce
  2. Innovation
  3. Intangibles such as healthy communities and children

That brings me to what all of you can do.

Our budget this year has taken a $97.6 million dollar cut, and we have a continuing $96 million dollar cut next year. Getting through this year and 2009-10 will be extremely difficult.

We will not take 10,000 additional students next year because we will not be funded for them.
We did it this year, and it has meant larger classes and fewer services – that is not fair to students.

We will not compromise quality…period.

We have been pretty successful at limiting the cuts to our budget – they could have been worse. We did that the past year with all of the CSU family working together, speaking the same messages to Sacramento about:

  1. Our economic value ($4.41 for every dollar invested)
  2. Our high public approval rates (62 percent in the recent PPIC survey)
  3. And our success at granting 92,000 degrees to people who then go to work and contribute to the economy.

Those 92,000 graduates – now alumni – may not be enough, though. Another PPIC report showed that California will have an alarming lack of residents with bachelor’s degrees by 2025 if we continue going the way we are going.

That might seem like a long time away, but in reality it is not, when you are talking about graduating and training the next workforce.

So, we need all alumni to come together again as advocates and let your legislators know that they must invest in the CSU if they want a healthy economy again. That means voting for those who understand that we need some tax increases; and voting against those who say they will never raise taxes. We need some realism in Sacramento.

That means working with your presidents, Karen’s office and other campus people to call, write, email and text legislators and the governor about the value of the CSU to this state.

This is an urgent assignment that cannot wait. Before I close, let me tell you what I have told employees: we will do all we can to protect the jobs of our current employees and focus on students.

We have been working on ways to reduce costs while doing everything to protect our students, faculty and staff in this unprecedented fiscal crisis.

The 23 campuses and the Chancellor’s Office are reducing non-essential travel, equipment and other purchases, and we will fill only those positions critical to the operation of the organization.

We are freezing the salaries of the vice presidents, presidents, vice chancellors and chancellor.

We are being accountable and creating efficiencies across the board. Regretfully, we have halted construction on all state-funded building projects because of the lack of funds. This is close to a billion dollars and hundreds of projects.

We will continue to look at ways to reduce our costs and our spending while protecting the quality of our university.

I know this has been a gloomy report, but there isn’t much sunshine in the Golden State at this point. But I do have faith that if we all continue on the right path, we can help turn this ship around, even if it is a slow process.

I appreciate your continued hard work and all that you do every day to make the CSU an outstanding university. Let’s keep working together to keep it that way. Thank you.