Sources of Revenue | 2014/15 CSU Support Budget Executive Summary | Budget | CSU
2014/15 Executive Summary

Sources of Revenue

The 2014/15 California State University Support Budget includes a $237.6 million increase to the currently authorized CSU $2.3 billion General Fund (GF) base for a total of almost $2.6 billion.The 2014/15 California State University Support Budget includes a $237.6 million increase to the currently authorized CSU $2.3 billion General Fund (GF) base for a total of almost $2.6 billion. This level of state funding would be slightly less than the amount provided by the state eight years ago. The $237.6 million General Fund requested increase for 2014/15 budget is comprised of the following:

  • $237,462,000 to fund 5 percent enrollment growth, programs, and operations; and
  • $152,000 to fund annual cost increases for the state Center for California Studies Capitol Fellows Program.

The CSU 2014/15 budget plan also adjusts tuition fee revenue for changes in student enrollment patterns, such as changes in relative numbers of graduate and undergraduate students and full-time and part-time students. It also reflects tuition fee revenue from the recommended 5 percent California resident student enrollment growth. The net change in tuition fee revenue (after adjusting for forgone revenue associated with financial aid) due to these factors is $96,641,000 as summarized below:

  • Change in Enrollment Patterns—$12,057,000
  • 5 Percent Enrollment Growth—$84,584,000
    (16,826 FTES Base Revenue)

The total 2014/15 support budget plan increase in sources of funds is $334.3 million.

State General Fund Increase $237,614,000
Tuition Fee Revenue Adjustments $96,641,000
TOTAL $334,255,000

Programs and Operations (top)

The 2014/15 CSU budget request is based on a General Fund increase of $237.6 million and tuition fee revenue adjustments of $96.6 million to fund the cost of budget plan expenditure augmentations for various needs, including mandatory costs, enrollment growth, employee compensation, student success and completion, and financing maintenance and infrastructure needs. The General Fund increase also includes funding for the Center for California Studies. These cost increases are detailed in the next section.

5 Percent Enrollment Demand/Growth (top)

The 2014/15 budget plan augmentation supports a 5 percent increase in resident student enrollment to continue to restore CSU student enrollment and address California’s higher education demand.

Many CSU campuses continue to experience record levels of applications and enrollments. The CSU had to turn away more than 22,000 eligible undergraduate applicants in fall 2012. Demand for the CSU has remained high. During the past several years, state funding restrictions have constrained the ability of the CSU to admit eligible applicants as shown in the following chart.

Eligible Undergraduate Applicants—California Residents

Eligible Undergraduate Applicants - California Residents

ELIGIBLE UNDERGRADUATE APPLICANTS - CALIFORNIA RESIDENTS
  Fall 2008 Fall 2009 Fall 2010 Fall 2011 Fall 2012
Admitted 167,606 193,928 173,562 178,615 194,564
Not Admitted 6,174 10,435 28,803 21,697 22,123

Increasing enrollment from the current state-assisted level of 336,510 California resident FTES by 5 percent to a new level of 353,336 is entirely feasible, given adequate support from the state. Continued restoration to meet demand of baccalaureate and master’s instruction at the CSU is a vital investment by the state for the sake of student access and for the sake of California’s further economic recovery and workforce development. Simply on the basis of application demand, an increase in state-assisted enrollment of more than 5 percent would be justified. However, due to the lead times and operational complexities of implementing enrollment growth at the campuses, this request is limited to 5 percent for the 2014/15 fiscal year.

Based on the state-approved marginal cost methodology, the 2014/15 estimated net marginal cost rate of instruction, after forgone financial aid, has been calculated at $9,737 per FTES. This amount times 16,826 FTES (5 percent) equals an estimated cost of $163.8 million. This total would be offset by the $84.6 million of estimated tuition fee revenue (net of financial aid) generated by the additional enrollment, leaving $79.2 million to be funded from the state General Fund appropriation. The 16,826 FTES translate into more than 20,000 additional students (individuals), representing a requested state investment of less than $4,000 per student.

2014/15 Tuition Fee Revenue (top)

A 5 percent increase in resident FTES enrollment (16,826 FTES) is projected to generate $84.6 million in new tuition fee revenue, after adjusting for forgone revenue associated with students receiving CSU Tuition Fee Discounts.

Additionally, a revenue adjustment of $12.1 million will be reflected in 2014/15 campus revenue assumptions due to changes in California resident and nonresident enrollment patterns used in revenue calculations. CSU tuition fee revenue projections are based on the most recent past-year student classification and fee paying distribution patterns, and adjustments are made annually to account for the year-to-year change in revenue assumptions. The most recent past-year data available for 2014/15 calculations are for the 2012/13 college year.