E-mail Notice
The notice below was originally shared with the university community via e-mail.
January 30, 2008
2008-2009 Budget Update
To: Staff and Faculty
Dear Colleagues,
The budget situation in California is discouraging at best. The State is
anticipating a $14.5 billion deficit for the 2008-09 budget year. In
acknowledgement of that deficit, the Governor's budget, issued January
10, 2008, identified a $312.9M cut to the CSU's 2008-09 budget. In
addition, the proposed budget did not fund the Trustees' request to buy
down the potential student fee increase of $73.2M. In effect, this
reduces the budget by $386.1M ($312.9M+73.2M). In summary, the
Governor's 2008-09 budget only funds the CSU for the current 2007-08
level of enrollments, even though the CSU had plans to enroll 10,000
additional students in the 2008-09 academic year.
In accordance with the multi-year Compact reached with the Governor
several years ago, the CSU had requested $288.2M in general fund and
student fee support to address critical needs such as compensation
agreements and enrollment growth. In addition to Compact-level funding,
the CSU also requested $155.2M to address other critical needs such as
additional enrollment growth, student services and increased
compensation.
The Governor's proposed budget reduction of $312.9M and failure to
buy out student fee increases would
1. deny access to an additional 10,000 students;
2. threaten to undo the tremendous success CSU has achieved in its
outreach to under-served students over the past three years;
3. jeopardize the collective bargaining contracts negotiated last
year, seriously affecting the CSU's ability to recruit, hire and
retain qualified faculty and staff;
4. weaken California's economy by not investing in workforce needs
in areas such as nursing, engineering, agriculture and biotechnology.
What does this mean for Humboldt State University? The answer is
uncertain at present, but we must plan for a substantial reduction next
year. In addition to this year's expenditures, we expect to have
increases in compensation costs, CMS costs, utilities, maintenance, and
other needs that could total between $2M and $4M. While we have some
flexibility in allocating money to these areas, it is almost certain that
we will have at least $2M more in expenditures in 2008-09 than we have
had in this fiscal year. If we have to reduce our budget based on the
Governor's current projections, that will probably mean an additional
reduction of about $4M for a total reduction of $6M. The good news is
that our additional enrollment will result in new revenue in 2008-09 of
about $3M from student fees, but we will not be receiving any State
general fund allocations for those students above our funded enrollment
target of 7034 FTES. Thus, with our additional expenditures of $2M (best
case) and a reduction of State allocations of $4M and additional revenue
of $3M, we will need to reduce our expenditures in 2008-09 by about $3M
under optimistic assumptions.
How are we going to plan to take these reductions? First, we need to
carry over as much of this year's allocation as possible in order to help
us plan effectively for next year's budget reductions. Please scrutinize
your expenditures for the remainder of the year very carefully. Each
reduction we make this year will help mitigate the reductions in 2008/09.
Second, we should reduce or eliminate, if possible, the recruitment of
new faculty, staff and administrators to the university. Third, I will
work with the vice presidents to prepare a plan for targeted reductions
in our budget to bring our expenditures into line with the revenue we
anticipate having in the next fiscal year. This plan will be presented
to the University Budget Committee for its review as well as to the
appropriate committees of the Senate, the Staff Council and other campus
groups. We do not expect to have a final appropriation from the State
until summer at the earliest so we must begin to plan now based on our
best assumptions of what the future holds.
All of us at Humboldt State University should be proud of the effort we
have made to achieve the enrollment growth that will provide for a
healthier financial future. It's particularly hard for me to report this
budget information to you because for the first time in many, many years,
HSU was poised to enroll approximately 7,400 annual average full-time
equivalent students (FTES). This is more than 300 FTES above our current
enrollment target of 7,034.
Although HSU will not have campus-specific information for some
time, the following steps can be expected:
1. The Legislative Analyst's Office will review and release its
analysis of the Governor's budget proposal by mid-February.
2. The CSU will issue the campus-specific preliminary budget in early March.
3. The Governor's May revised budget will be published by the third
week in May.
4. Legislative debate over the budget will occur in May and June and
perhaps beyond.
5. A budget signed by the Governor is due by July 1, but this
deadline frequently is missed.
As the budget process unfolds, I will continue working with the
Chancellor's Office and the legislators to make sure that HSU's voice is
heard, and I will keep you informed as budget details become available.
In the meantime, please do not be too discouraged. We must not allow
budget challenges to consume all of our energy. We have students who are
depending on our teaching and guidance as they pursue their dreams, and I
believe that our shared commitment to public higher education will carry
us through these economic difficulties.
Sincerely,
Rollin C. Richmond
President