New CSU Budget Honors
Governor Arnold Schwarzenegger has signed a new state
budget that provides $226 million in new revenue for the
California State University, fully funding the trustees'
budget request for 2006/07, and providing enough funds to
eliminate student fee increases scheduled for fall
The proposed budget provides nearly $2.8 billion in
state General Fund revenue to the CSU, representing a 7.8
percent increase over the current 2005/06 budget year
appropriations. Included in this amount is $54.4 million above
the state's General Fund commitment in the Higher Education
Compact to eliminate a proposed fee increase of 8 percent for
undergraduate and 10 percent for graduate students.
"The budget the governor signed is good for the
students, their families, and the CSU," said CSU
Chancellor Charles B. Reed. "The elimination of the fee
increase provides financial relief to middle class students,
affording them more time to study and less time working to pay
for the additional fee increase.
"This budget underlines the governor's commitment to
offer more students an opportunity to achieve a college degree
and to meet the demand for an educated workforce that can only
strengthen California's future," Reed said.
As agreed to in the compact, the budget provides a 3
percent general fund increase of $75.8 million for general
The budget provides the CSU with $61.3 million for a
2.5 percent enrollment increase. This increase will open
university doors for more than 11,000 additional students. The
2.5 percent increase in enrollment is projected to generate
$26 million in revenue. The budget provides a permanent
outreach funding appropriation of $7 million and also provides
nearly $2.4 million to support nursing education and $1.1
million for teacher training in math and science.
"The CSU was subject to three years of budget
reductions that resulted in a loss of more than $500 million
to the university," said Richard West, CSU executive vice
chancellor and chief financial officer. "This budget
recognizes and begins to address some critical funding issues
faced by our campuses, as well as the impact of those budget
reductions on students, faculty, and the delivery of education
in the classroom."
"These funding priorities are consistent with the
trustee's budget recommendations," said Roberta Achtenberg,
chair of the CSU's Board of Trustees. "Funding for nursing
programs and for K-12 teachers of math and science is critical
to address certain specialties where California has a great
need for more qualified professionals."
The CSU will use $70.1 million to fund costs of direct
instruction, academic support, and student services associated
with enrollment growth. In 2006/07, the CSU will have
approximately 435,400 students.
The CSU plans to use $77.4 million of the Higher
Education Compact to fund a 3 percent compensation pool for
all employees. In addition, in 2006/07 the CSU will initiate a
five-year strategic plan to begin reducing significant salary
lags for all CSU employees. The CSU's 2006/07 budget plan
includes $16.6 million for the first year of the plan.
Combined, they represent an overall compensation increase pool
in 2006/07 of 3.64 percent. With respect to the compensation
for represented employees, the amount of such compensation is
not predetermined, but shall be subject to collective
bargaining. This applies both to the 3 percent compensation
pool as well as increases to reduce salary lags.
The budget plan also allocates $33.6 million for
mandatory costs -- expenditures the university must pay
regardless of its financial condition -- including health
benefits, new space, energy, and service-based salary
increases. It also allocates $10 million to fund long-term
needs in technology, libraries, deferred maintenance and
The newly approved budget increases allow California
resident students entering the CSU to avoid expected fee
increases. Instead, they will pay state university fees at
current year levels: $2,520 for undergraduates, $2,922 for
teaching credential students, and $3,102 for graduate