Chancellor's Report

to the Board of Trustees

March 12, 2003

Thank you, Chair Farar.

I want to join you in thanking President Gordon and his staff for hosting us here. It is no small duty to host a board meeting. Milt, I especially want to thank you, Norma Morris, Judy Burns, and Cassandra Newby. I know that they have done most of the work under your supervision.

As Chair Farar said, I have passed the five-year mark at the CSU. It's been an incredible opportunity and a privilege for me to work and serve the CSU faculty, student, and staff. After five years I still love getting up early every day and going to work, and I want to continue to do that. I want to personally thank this board for giving me this opportunity and for giving me your confidence and your support. I'll probably need your confidence and support in the next few months as we go through some tough budget times together.

In my estimation, this is the best board I have ever worked with and I mean that. The mix of business, education, and political experience that this board brings certainly makes my job more enjoyable. It makes it easier and it gives me confidence to do what I think I need to do. So I want to thank you for that.

I also want to thank all of the presidents. This is the best group of presidents that I have worked with in 25 years. They work very well together. They are trying to build the system knowing that the better the system is, the better their institution is. They do a great job representing their institution and keeping the diversity among and between those institutions strong. I want this board to know that they're the best in this country. They have my full confidence in what they do every day.

As Debra also mentioned, we hope to come to conclusion in the next 24 hours with two presidential searches. We have another that we are going to begin at CSU Chico that Roberta Achtenberg is going to chair, so we'll keep the board apprised of that.

The budget continues to take the majority of my time and energy. When I came here five years ago it was quite a different picture. I would say that we have done a 180-degree turn and headed straight south in the last few months.

We are looking at a $260 million cut at best, which is about a ten percent cut. We are expecting 424,000 students to show up on all of our campuses next September. We are going to welcome these students next August because we have sent out our letters of admission. What is really important for us and for the campuses is that they show effective management of the instructional programs across the entire university. Plus, we need to receive the funding for the new students and the fee increases assumed in the governor's budget.

If we don't do all three of those things it could be devastating to the CSU. The reason that I say that is that I don't anticipate the legislature is going to finish on time. Because of that timing we will have all of those new students and we will need to provide classes for them. If we receive any future reduction, we'll have to make it up in the second semester. When you do that you have to cut levels to make up for what you have not been able to reduce as the academic year starts. So that would really be a huge challenge.

During these difficult times, it is essential to have a plan. That's one of the problems with our state government: There is no plan. But we know that we can't go to Sacramento without a plan. We also know that we can't go Sacramento and just simply say, "Don't cut me, cut everybody else," because that's not going to work.

When you have a $35 billion deficit everybody in California is going to suffer. The health and welfare programs, transportation, public schools, and community colleges — everybody will feel this reduction. We have tried hard in our office to make this a consultative process. Our system-wide budget advisory committee is meeting monthly. The finance committee of this board is meeting monthly. Richard and I had put on our schedule a meeting this afternoon with the Labor Council, but I was told this morning that it has been canceled and I regret that.

Later this week we are going to hold a budget summit through the shared governance process with all of the Academic Senate chairs throughout the system, presidents of the student body, executive committees of the CSSA and Statewide Academic Senate, and all the presidents.

From those meetings we hope to continue to sharpen our plan and to make sure that we are able to tell our story in Sacramento. Most of you will be going to Sacramento next week and that is very important. We will continue to keep this board informed on a monthly basis as things progress. We were told last week in my first appearance before the Senate not to expect a whole lot until after the May Revise occurs. We will continue to participate in hearings between now and that time.

Another topic I want to mention is Trustee Achtenberg's policy committee discussion on the graduation task force. When I came here this board directed me to implement the Cornerstones plan. The recommendation of that task force is key to the successful implementation of Cornerstones. It really focuses on improving the California State University for students.

You also heard this morning about community service learning. That is something that I would like all of our presidents, all of our trustees, and all of our CSU family to promote. The California State University is the best in the United States at community service learning. As Erika Randall said, we provided over 34 million hours of service to the citizens of this state last year. Our students who have jobs and families stop and give something back every week to their communities. No other university does it as well or to the extent that our students do in the California State University.

Erika is an outstanding leader. She didn't take credit, but Erika raises about $2 million a year outside of what the state provides to help run these programs and Erika is recognized as the best leader of community service in the United States.

I also want to recognize Trustee Shailesh Mehta for something that he has done. Many of you may have seen that piece that 60 Minutes did a week ago on the Indian Institute of Technology. The Indian Institute of Technology is one of the most prestigious and selective universities in the world, equivalent to MIT, Harvard, Yale, and Princeton all put together. Well, that's not bad. What I want to share with you is that the Indian Institute of Technology has given Trustee Mehta the Distinguished Alumni Award for 2003. They do not give this award very often and they have recognized one of their own. Congratulations, Shailesh.

Chair Farar, that concludes my report.