2005/06 Support Budget

Sources of Revenue

Sources photoThe resources for the 2005/06 California State University Trustees' Support Budget rely on the funding parameters outlined in the Higher Education Compact.

Higher Education Compact ($224,845,000)

The Higher Education Compact signed with Governor Schwarzenegger, in May 2004, provides a long-term, stable financial planning base for the university. This multiyear agreement commits to a long-term resource plan for the CSU that addresses base budget allocations, enrollment, student fees, and other key program elements for 2005/06 through 2010/11. The compact General Fund base is calculated as shown on the following table:

Sources table 1 - TO BE REPLACED

The compact is comprised of the following key components for 2005/06:

  • 3% General Fund Increase for General Operations ($72,791,000)
    The Higher Education Compact provides a 3 percent General Fund increase or $72.8 million for general operations. This 3 percent General Fund increase is calculated by adjusting the prior year base General Fund allocation by the change in lease bond payments, deferred maintenance costs, and retirement expenditures. This adjusted base ($2.43 billion) provides the calculation point of the 2005/06 3 percent General Fund increase.

  • 2.5% Enrollment Increase ($50,806,000)
    A 2.5 percent enrollment increase in 2005/06 will generate an additional 8,103 FTES at the CSU. In 2005/06, the CSU is preparing to serve a total of 332,223 FTES. The additional enrollment will be funded in part from the state share of the marginal cost of instruction. The state share of this cost is determined by reducing the total marginal cost rate calculated for the fiscal year by the expected student contribution of State University Fee revenue. The full marginal cost of instruction calculated for 2005/06 is $8,401 per FTES. The state share of this cost is $6,270 per FTES.
  • Sources table 2

  • Revenue from Student Fee Increases ($75,914,000)
    The Higher Education Compact states the CSU will develop its annual budget plan based on the assumption that student fees will increase by 14 percent for 2004/05, and by 8 percent for 2005/06 and for 2006/07. Thus, undergraduate fees will have increased by 10 percent per year on average over a three-year period. In academic year 2005/06, State University Fee rates for CSU full-time undergraduates and students participating in a teacher credential program will increase by 8 percent or $186 and $215 respectively. Full-time graduate/postbaccalaureate State University Fee rates will increase by 10 percent or $282. These fee increases will generate approximately $75.9 million to support CSU educational services. Even with the proposed rate increase, CSU students will continue to pay, on average, one of the lowest fee rates of any institution in the nation.

  • Revenue from Enrollment Growth ($25,334,000)
    Revenue associated with the 2.5 percent increase in full-time equivalent student enrollment, or 8,103 FTES, will generate approximately $25.3 million in new student fee revenue at the fee rates proposed for 2005/06. The Higher Education Compact calls for between 20 percent and 33 percent of all new State University Fee revenue to be used for financial aid. The CSU is projecting to supplement current financial aid programs with 25 percent of all new State University Fee revenue associated with marginal cost funding ($3.8 million), which will cover financial need associated with enrollment growth.

Sources table 3

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Last Updated: October 28, 2004