GOVERNOR PROPOSES 12% INCREASE IN CSU BUDGET

Governor Gray Davis proposed a $267.9 million or nearly 12 percent increase in the 2001/02 general fund budget of the California State University today (Jan. 10). The increase, when combined with the $23.6 million in projected fee revenue from enrollment growth, would bring the total CSU base state budget to about $3.5 billion.

"Time and time again the Governor has demonstrated his strong commitment to higher education. This budget is another example of that," said CSU Chancellor Charles B. Reed. "State support for the California State University budget has increased by nearly $834 million over the last three years, and this budget would continue that remarkable investment in the California State University's future."

The budget focuses on four key areas: ensuring student access at a time of rapidly increasing enrollment; maintaining a high quality education, in part through recruiting and retaining the best faculty and staff; improving student academic preparation through K-12 collaborations; and contributing to California's economy and workforce development by investing in key academic programs.

The Governor proposed a $62.3 million increase for an additional 8,760 full-time equivalent students predicted to enroll in 2001/02. An additional $16 million has been allocated to support year-round operations for 3,138 full-time equivalent students to attend in the summer.

The Governor also proposed an increase of $81.5 million for a 4 percent compensation pool for all CSU employees to keep salaries competitive and reward outstanding performance. The CSU has also requested an additional 2 percent employee compensation increase, and will work with the state to secure those funds by the May budget revise.

The 2001-02 budget is consistent with the Governor's Higher Education Partnership Agreement, which brings stable, long-term funding to the CSU in exchange for a commitment by the CSU to be accountable through specific performance measures.

Budget items within the partnership agreement include:

• $10 million for academic programs important to California's workforce and economy such as agriculture, engineering, computer science and nursing.
• $8 million to expand CSU K-12 academic preparation from 150 to 300 targeted high schools and help reduce the need for remedial education.
• $10 million to complete the CSU technology infrastructure build-out.
• $5 million to significantly increase access to networking services for students, faculty and staff on each campus and to expand CSU electronic library resources.
• $4 million for libraries.
• $4 million for deferred plant maintenance.

In addition, funding in the Governor's budget beyond the partnership includes:

• $3 million for the final investment in new campus costs at CSU Channel Islands.
• $17.5 million for the Governor's Teacher Fellowship Program, which provides $20,000 fellowships for individuals to attend teacher preparation programs and then teach in underperforming schools after attaining teaching credentials.
• $18.5 million for the Governor's Education Technology Professional Development Program, which will train 12,500 teachers in the use of technology in the classroom and curriculum that focuses on improving the quality of teacher instruction and the level of student learning.
• $20 million in one-time funding for long-term critical instructional equipment.
• $650,000 to initiate a Central Valley Economic Incubator at CSU Fresno to serve high technology firms having engineering and computer science needs.
• $1 million for the Diagnostic Writing Service (DWS) to help students and teachers identify students' writing and reading deficiencies and allow teachers to develop a program to strengthen students' skills necessary to succeed in college.
• $3 million for three areas of applied research activities:
  • $1 million for the Agricultural Research Initiative, a collaborative partnership among CSU agriculture campuses that supports high-impact applied agricultural and natural resources research, development, and technology transfer activities.
  • $1 million for the CSU Program for Education and Research in Biotechnology (CSUPERB), a broad-based multi-campus program designed to promote critical biotechnology growth needs in the state.
  • $1 million for marine studies as matching funds in collaboration with a federal research initiative to increase CSU applied research activities in this field.

The CSU will continue to work with the state to fund the following items that were included in the Trustees' budget request but not yet in the Governor's budget:

• $40.8 million for an additional two percent faculty and staff salary increase above the partnership to continue to reduce the faculty salary lag.
• $12 million to improve student services by providing additional academic counseling and encouraging students to stay on course toward degree objectives.
• $5 million to help create an employee housing assistance program - a key issue in attracting high-quality faculty and staff.
• $3 million for joint use of facilities and collaborative programs among the CSU, University of California and California Community Colleges to better use existing resources.
• $3.1 million to fund the entire intersegmental request for the Diagnostic Writing Service to cover exam costs for two-thirds of California's high school juniors.

The 2000/01 budget request does not include any student fee increases. The annual CSU fee of $1,428 has not increased since 1994 and is among the lowest in the nation.

NOTE: The increase in the CSU budget announced by the Governor and the CSU vary slightly because different base budgets are used due to differences in accounting practices for carry forward funds, retirement benefits, one-time funds, and fee revenues.

10 January 2001