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CSU Budget Office

Frequently Asked Questions: Tuition Fees & Other Revenue

Application Fee

Has any thought be given to increasing other systemwide mandatory fees, such as the CSU Application Fee?
CSU is currently reviewing all fees to balance fee rates with actual service provided.

Bond Ratings

What criteria do the rating agencies use to evaluate CSU debt?
There are many quantitative and qualitative factors that drive higher education credit ratings.  Among those factors are the following:  market reputation, scope of opperations, student demand and pricing power, and philanthropic support; cash flow, budgetary flexibility and operating freedom, and revenue diversity; wealth, liquidity, and capital investment; experience, background and track record of the board and senior management, oversight and disclosure practices, short- and long-term planning, self-assessment and benchmarking, and government relations; and bondholder security provisions, and external financing terms and conditions.

Course Repetition Fee

Are any changes proposed for CSU refund policy to address financial inefficiencies?
CSU refund policy is designed to recognize unforeseen circumstances that may occur over which students have limited control. The current refund policies are being reviewed.

Should students be charged a special fee for repeating a course?
This proposal has received several comments supporting its intent and will be discussed by the Board of Trustees as a part of a larger revenue enhancement conversation.

Differential Tuition and Fees

Would a per unit fee rate provide a more effective revenue model than the current two-tiered structure?
CSU is investigating a number of options to make fee rates more cost effective for the students and financial administration.

Has any consideration been given to using differential fees to fund educational costs?
CSU currently charges differential fees by student classification (undergraduate, graduate post-baccalaureate, and doctoral). Changing the rate structure for the systemwide tuition fee to recognize additional unit pricing differentiation such as campus geography, campus academic mission, and high impact/high cost programs have been or are currently being reviewed.

Has any consideration been given to charging differential tuition rates based on campus location or program cost or impaction?
Attempting to recognize geographical differences would require a review of the CSU's Master Plan mission, which is to provide affordable access to CSU-eligible student regardless of geographic location. That is one of the major reasons CSU campuses have been strategically placed within every region of the state, with the underlying presumption that the state, not the student, would bear the preponderance of financial responsibility for their operation. As CSU addresses issues related to changes in the state's funding model for higher education, a review of geographic student pricing would have to be considered within the broader context of the mission and goal of higher education in California.

Graduate Tuition

Are proposals for increases in tuition rates reviewed for impact on student enrollments at both the undergraduate and graduate level?
All decisions on CSU fee increases weigh potential impact on student enrollments. CSU recognizes that a vibrant graduate student population enhances undergraduate instruction and attracts highly qualified faculty. A proposal to increase graduate fee rates would not only consider the potential impact on enrollment, but also weigh state funding levels for graduate instruction, comparison institution fees, and state policy goals.

Miscellaneous Course Fees

Are additional charges for technology associated with the delivery of course offerings under consideration?
Each campus makes decisions about implementing miscellaneous course fees by evaluating the tangible need for supplemental support for a course.

National Studies

Have revenue enhancement studies conducted by other higher education institutions such as the University of California's Commission on the Future been reviewed for ideas that may assist CSU strategies?
Review of other higher education strategies have been made within the context of statutory polices governing CSU. For example, the University of California is a constitutionally independent, research-focused public institution of higher education. The California State University is state-dependent legal entity with a teaching-focused mission to address the primary workforce needs and the economical viability of California. While the missions of the universities are different, some initiatives under consideration by these two public university systems are shared goals, especially in terms of addressing the significant reductions in state funding for higher education. Like UC, CSU is investigating the cost benefit of moving all campuses to a semester calendar, increasing the number of CSU-eligible community college transfers, and broadening and developing a coordinated approach to on-line instruction. CSU has already undertaken and is reviewing ways to expand “synergy” initiatives that create additional efficiencies within our administrative and financial processes and practices.

Non-resident Students

Please consider exploring the opening of out-of-state and international campuses as a means for enhancing CSU revenue.
Thank you for this suggestion. A review of the short term and long term cost benefits of this proposal as a revenue enhancement strategy is required keeping in mind our primary responsibility to California residents.

Other Funds

Can additional revenue be achieved by expanded leasing of university facilities?
Campuses do have rental policies in place.

What are Systemwide Provisions?
Systemwide Provisions include CSU administrative obligations or programs that are managed through the C.O. for purposes of administrative or financial efficiency. It includes debt payments on lease-payment bonds to the State Public Works Board; payments to PERS for annuitant dental premiums; management of CSU academic preparation activities; financial audits; student testing contracts; CSU implementation of state initiatives such as Affordable Student Housing, the Math and Science Initiative, and the CSU Nursing Initiative; also intersegmental programs coordinated with the community colleges and UC such as Project ASSIST. To a very limited extent, Systemwide Provisions are also drawn upon when one-time funds are needed to meet emergencies or other compelling situations at specific campuses. It is more efficient to manage these activities within the Chancellor's Office than attempt to coordinate the functions among 23 individual campus departments.

What actions can the Board of Trustees take to mitigate the influence of state funding on the CSU budget?
The state's role in university funding is to be minimized, all CSU constituencies—not just the Board of Trustees—must be advocates for transformational change in how public universities are funded. The CSU is seeking various cost saving measures and may, among other strategies, be forced to increase tuition.

Are there other fund sources that can be used to support CSU educational costs?
CSU utilizes revenue from public gifts; federal, state and private grants and contracts; corporate donations; and, naming rights as examples of other revenue sources pursued to developed a quality educational program. CSU will continue pursuing revenue from these sources to establish a multi-faceted financial structure that supports the needs of students, faculty and staff.

Has there been any CSU effort to promote legislation or initiatives to help support higher education funding?
CSU has long advocated for new revenue sources that do not reduce current appropriations to the university or impede the university's ability to provide uninterrupted access to Californians who meet CSU eligibility requirements. The university has worked with the administration and legislature to vet all revenue proposals to ensure the core funding of the university remains intact and any new revenue streams are not accompanied by reductions in state funding obligations to the CSU. CSU evaluates all proposals for new revenue not only on the basis of the short-term gain that may accrue to the university, but also the long-term implications of the revenue source as a continuing cash contributor to future CSU need.

Can CSU use revenue from other non-state funds or campus fees to fund classes and salaries?
The use of non-state funds are governed by statutory policies that typically do not allow their use for state-support expenditures. Notably, Lottery Funds are governed by statutory policy that requires they be used to supplement, not supplant, state funding support for higher education. Lottery funds are currently used to offer start-up and supplemental funding for classes that support the instruction program. Utilizing non-state funds for classes and salaries would not provide cost savings or revenue enhancements.

What about selling unused real estate?
The CSU does not have the authority to sell state property.

"Super Senior" Fee

Should students be charged a fee when they have exceeded the number of units needed to graduate?
Proposals to charge additional fees to students with more than enough units to fulfill degree requirements or who take accelerated unit loads during an academic term are under consideration as an enrollment management strategy, which can potentially result in revenue enhancement for the CSU as enrollment access is increased.

Tuition Increases and Waivers

Instead of raising student fees again, why don't we require students to contribute supplies, just like public schools?
The systemwide mandatory tuition fee does not fund student supplies. It funds the operational costs of providing instruction to CSU students. This includes providing faculty to teach and develop courses; staff to open libraries, clean classrooms, and maintain facilities; employees to enforce public safety and secure computing systems; analysts to admit and register students, budget and track expenditures, and operate financial aid programs; administrators to oversee and manage CSU's adherence to state and federal law, generally accepted financial, student and employee data-collection standards, and state and national educational reporting requirements; and technicians to install and maintain technology infrastructure.

Why isn't the CSU proposing a fee increase linked to the failure of the tax vote in November?
Linking fee increases to the tax vote is being evaluated by the Trustees. Campuses are required to take one-time actions to in the event the tax initiative fails to avoid a mid-year student fee increase the 2012-13 fiscal year. The CSU is evaluating the feasibility of campus budget plans to make permanent expenditure reductions to address the budget cut, if executed, by the beginning of the 2013-14 fiscal year.

What share of the total cost of education is funded with student fee revenue?
The CSU must align expenditures with the amount of the funding it receives. With roughly 50% of costs covered by tuition and the rest from the state, if the state appropriation is is reduced and the University is not permitted to raise tuition, it will become necessary to right-size the University.

As a budget strategy, increases in tuition fees or reducing the number of students served are the only viable options to ensure CSU will provide a valuable educational product.
The cost reduction and revenue enhancement strategies under consideration are being reviewed for the ultimate goal of achieving a high quality educational product that benefits all Californians. Balancing this goal within the context of tuition fee increases and enrollment management that emphasizes CSU only serves students for which adequate funding has been provided is a point well taken.

Why are tuition fees raised so frequently and how much revenue is lost providing tuition waivers for employees and seniors over 60?
Tuition rate increases at CSU over the past several years have been the direct result of ever increasing reductions in state appropriations to higher education generally and CSU specifically. The revenue received from the tuition rate increases has been used to backfill state General Fund reductions. There are currently 3,110 employees or employee dependents who receive tuition waivers for two courses of instruction per term. If each of these individuals utilized tuition fee waivers each term in an academic year, it would have cost the CSU roughly $10 million in lost revenue in 2011-12. CSU employee fee waivers are negotiated during collective bargaining. Waivers for seniors over 60 is the only age-based tuition waiver offered within CSU. These waivers are generally offered on a space-available basis (meaning there is an unfilled seat within the class of interest), so it is unlikely there is a significant “cost” or revenue loss to CSU associated with the provision of these waivers.

Use of Tuition/Fees

How is CSU tuition fee revenue used?
The CSU tuition fee is used to help support all enrollment-related costs associated with student instruction, academic support services (e.g. libraries), student services (e.g. advising and counseling), institutional support services and the operations and maintenance of the campus plant.