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financial stability

The goals of ensuring educational excellence and broad access to it are best met in an environment where resources are stable enough that campuses can make plans, determine priorities, and successfully implement them. Equally important, students should be able to plan confidently for the completion of their education in an environment in which both their fees and adequate aid are predictable. This requires a new financial policy framework for California higher education.

The California State University is committed to developing a long-term financing policy agreement between the State of California and the institutions of higher education. This new policy must be grounded in the long-term economic, educational, and social value to the state derived from higher education. California's annual state budget decisions must support the long-term policy commitments of the state's Master Plan for Higher Education. Above all, the state must align its resource allocation and reward policies with its highest priority social goals.

At the same time that the CSU leadership commits itself to develop a long-term policy agreement with the state, Cornerstones reaffirms the most central principle of any such policy: that the responsibility for maintaining excellence, diversity, and health of the CSU is shared by the state, the CSU system, our many campuses, the faculty, the staff, and students. At its heart this principle of shared responsibility expresses the very nature of a public university: that we are a precious public resource, supported generously not only because we offer opportunity to each individual student but because we contribute to the social, cultural, and economic health of the society at large.

Under these terms, the State of California will ensure adequate resources for new enrollment growth, with reasonable base budget adjustment beyond inflationary increases, the protection of access through significantly expanded student aid programs, and the resources needed to attract the best new faculty and to bring faculty salaries to parity with comparable universities.

At the same time, the CSU must adopt policies and procedures through which the system and the campuses increase our productivity in reaching, recruiting, supporting and teaching our students. The relentless search for more state funding must be matched by our own efforts to produce excellence. Financial stability will only be achieved through a combination of increased revenues and increased productivity and savings.


PRINCIPLE 7: The State of California must develop a new policy framework for higher education finance to assure that the goals of the Master Plan are met. This framework should be the basis for the subsequent development of periodic "compacts" between the State and the institutions of higher education.

The elements of this framework include:

7a. The California State University is a public teaching-centered institution. The State of California must maintain its basic commitment for public tax support of this institution now and into the future. As a result, the CSU must acknowledge, ensure, and document, that it is fully accountable to the people of the State of California.

7b. The public tax base must be supplemented by private revenues in order to assure continued access and quality in the future. A policy framework that identifies how private revenues can be used to supplement public funding is needed to allow this to occur.

7c. There are public and private benefits to investment in higher education, and the system of finance should recognize both aspects.

7d. Students and their families should bear responsibility for paying a portion of the costs of their education, because there are substantial returns specifically to the individual from achievement in higher education. The State of California must adopt a more realistic and stable long-term student fee and financial aid policy as part of a new state policy framework.

7e. The fees paid by students may increase as they move from undergraduate to graduate and professional education. Professional fees for post-baccalaureate education may reflect differences in program costs; such fees must be matched by adequate financial aid for eligible students. This policy must be monitored carefully to ensure the continued strengthening of graduate programs, and that access is increased, not decreased.

7f. Student fees should not be a barrier to higher education for academically qualified but financially needy students. Economic access can be maintained despite increases in fees through appropriate financial aid programs, which should be maintained as a public priority.

7g. The CSU shall maintain the tradition of not charging differential fees within baccalaureate programs to reflect cost differences, both because of the essential breadth of the curriculum and the potentials for such differentials to serve as barriers to student exploration and choice of alternative courses of study.

7h. The goals of educational quality and institutional efficiency can be complementary. Effective management, including attention to institutional goals and outcomes, must be achieved as a shared responsibility between the faculty and the administration. The public must believe that costs being charged are reasonable and that quality is being maintained, through evidence provided in an accountability system that includes public reports.


PRINCIPLE 8: The responsibility for enhancing educational excellence, access, diversity, and financial stability shall be shared by the State, the California State University system, the campuses, our faculty and staff, and students.

The options presented in support of this principle fall into two categories, those providing revenues, and those increasing savings through productivity.

Revenue Options

8a. The CSU must continue relentlessly to pursue state general funding to meet the core needs of the institution. Base funding for the institution must be provided for enrollment growth, quality and capacity.

8b. Steps need to be taken to develop a stable long-term student fee and financial aid policy as part of a long-term funding compact with the State of California. Student fee increases should only occur as part of a planned and managed financial compact among the institution, the state, and the students. Students should know when they first enroll in the CSU what their fees will be when they graduate. In keeping with current Trustee policy, one-third of all revenues from fee increases should be reserved for institutional financial aid.

Productivity and Reinvestment Options

8c. Cornerstones proposes a "faculty development and reinvestment" program, in which the CSU and each campus anticipates opportunities to increase productivity over the next decade. Productivity increases seem particularly likely if retirements occur as anticipated, and an increased proportion of replacement faculty are hired into tenure or tenure-track positions at junior levels. An additional element of the strategy is the commitment to integrate faculty replacement planning with faculty development policies and resources to expand professional development for CSU faculty.

8d. Policies to guide how reinvestment and development occurs must be developed at both the system and the campus levels as part of the university's long-range policy and planning efforts.

8e. Other options to increase productivity include reductions in remedial education costs, increased administrative efficiencies, and a reduced time-to-degree afforded through better counseling and course scheduling. CSU faculty should also examine the prospects for increased productivity through the use of teaching techniques that effectively employ technology.