University Budget Committee (UBC) and Budget Forum II

1. University Budget Committee (UBC) and Budget Forum II May 23, 2008 8:00 a.m. – PAC 134 Kathy KaiserUBC Chair/Facilitator

2. Purpose of UBC/Budget Forum To acknowledge that we are a comprehensive University that must work collaboratively to plan, prioritize, and solve fiscal challenges in order for us to succeed. Strategic Mission/Values – “We affirm that we are “One University” where collaboration, mutual support and trust, and common goals define our work together and the spirit of its engagement.”

3. Purpose of UBC/Budget Forum To provide enhanced fiscal information to enable faculty, staff, students and other interested parties to achieve a deeper understanding of the University’s budget and related processes. Strategic Priority #5 – “Believing that we are accountable to the people of the State of California, we will continue to diversify our sources of revenue and strategically manage the resources entrusted to us.”

6. CSU & California’s Budget Process • Oct/Nov – CSU Trustees adopt Support Budget • Jan - Governor submits Proposed Budget and Budget Bill introduced to Legislature (Senate/Assembly budget committees) • Ongoing – Director of Finance issues guidelines for budget preparation to agencies and departments • Feb - Legislative Analyst’s Office prepares analysis of proposed budget • Mar to May – Legislative budget hearings and CSU constituent briefings • May – Governor submits “May Revise” Budget • May to June – Budget Conference Committee reconciles and adopts Budget • June – Legislature votes on Budget and Governor’s signs Budget (Budgets have been signed as late as August or September in past)

7. State Budget Advocacy • Campus Budget Rally (800 + attendees) • Alumni Legislative Day • Lt. Governor Garamendi campus visit • Alliance for the CSU, Call to Action

8. What Have We Been Doing? November through February • Budget Forum I • 2 UBC planning meetings • Analyzed Governor’s Proposed Budget • FAC/Cabinet budget planning meeting • Review of LAO analysis

9. What Have We Been Doing? April through May • 2 UBC planning meetings • 2 FAC/Cabinet budget planning meeting • Analyzed Governor’s May Revise • Budget Forum II • Meetings with Foundation Advisory Board, University Advisory Board, and College of Ag. Advisory Board

10. Governor’s May Revise • Pro-education May Revise Budget • Governor proposes to put $97.6 Million back into CSU budget • Flat State allocation • No provision for rising CSU costs • Risks: • Governor proposes to borrow $15 Billion from future Lottery revenues over next three years requiring a vote in November. • Contingency Plan: 1 cent increase in sales tax if voters reject lottery borrowing • Budget pressures continue: • CSU faces $114 Million in unfunded mandatory costs • Partially offset by 10% State University Fee increase approved by Board of Trustees which will generate “net” revenue of $73.2M • 2008 State Education Bond: status and related impacts

11. LAO Analysis of May Revise • Overly optimistic estimates about the potential growth in lottery sales and profits. • May cause future impacts to public education • Potential impact: $5 billion over next 12 years • Budget reforms are seriously flawed • Budget shortfall locked in • Loss of legislative authority • LAO Alternative Budget for CSU • Eliminate CSU enrollment growth funding ($48.1m)

12. What Does This All Mean?

13. State of California State of California Higher Education 10.3% of State Budget Higher Education 10.3% of State Budget Highest Impact on Resources “General Fund Only” California State University 23.4% of Higher Education Budget January Proposed Budget Numbers No State Bonds Issued No Marginal Cost funding for over-enrollment All Compensation & Mandatory Costs to Fund (new space, utilities, benefits) CSU, Chico 4% of CSU System Budget <$10.8M> - Proposed Budget

14. State of California Higher Education 10.3% of State Budget Moderate Impact on Resources “General Fund Only” California State University 23.4% of Higher Education Budget May Revise Budget Numbers No State Bonds Issued No Marginal Cost funding for over-enrollment All Compensation & Mandatory Costs to Fund (new space, utilities, benefits) CSU, Chico 4% of CSU System Budget <$7.0M> – May Revise

15. State of California Higher Education 10.3% of State Budget Lowest Impact on Resources “General Fund Only” California State University 23.4% of Higher Education Budget May Revise Budget Numbers State Bonds Issued No Marginal Cost funding for over-enrollment Partial Compensation & Mandatory Costs to Fund (new space, utilities, benefits) CSU, Chico 4% of CSU System Budget <$2.1M> – May Revise

16. Next Steps…

18. Multi-Year Budget Approach Excerpt from Strategic Priority #5 – “We will demonstrate the determination to allocate resources in terms of clearly articulated priorities and how those priorities contribute to making the University even more outstanding than it now is.” UNIVERSITY 10% Budget Reduction over the next 2 Years

19. “One University”Four Strategic Priorities • Student success, learning and progress toward degree • Generation and wise stewardship of University resources • Commitment to local / regional service in the North State • Commitment to diversity

20. Enrollment Forecast

21. Data provided from Enrollment Management

22. PREDICTING 2008/09 ENROLLMENT FTES Targets : CSU Target 15,109 CSU, Chico Target 15,870 (07/08 Actual)

23. Fall 2008 New Student Enrollment

24. Total Number of Students Expected for Fall 2008 Scenario 1 Estimated continuing students 12,261 Yield from applications 5,221 Total predicted 17,483 (16,259 FTES) Scenario 2 Estimated continuing students 12,261 Yield from “Intent to Enroll” 4,555 Total predicted 16,816 (15,639 FTES) Predicting Fall 2008 Enrollment

25. University Budget Committee Kathy Kaiser – UBC open dialogue • Observations • Comments • Questions…

26. Conclusion • Recap of budget planning efforts • Actively monitor State budget process • Marshal additional resources • Philanthropic efforts • Grant and contract activities • Continue advocacy efforts with “Alliance for the CSU”

27. Closing Thoughts “Cabinet does not make every decision…everyone at the University needs to be empowered to find ways to cut costs and save money where we can.” “Never leave the room for any reason during a budget cutting session.” - Len Wood Audience Questions?