Chancellor Reed says he's putting pressure on state to ease CSU crunch

By Rory Sa

CSU Chancellor Charles Reed will present the CSU Board of Trustees a preliminary budget for the 2004/2005 fiscal year.

The proposed budget for the CSU system goes before the CSU’s board of trustees on Friday. It will be sent to the governor’s office and the legislature to be incorporated into the initial 2004-05 budget proposal, which will be unveiled by the governor in January.

“ We’re providing very strong messages to the governor and the legislature; higher education is vital to California’s economic recovery,” Reed said.

“ Universities are the engines that drive the economy of California,” he said.

Despite a cut of $304 million the CSU system increased enrollment of 17,000 students, for a total of 314,000 students enrolled in the CSU system. Reed anticipates an annual increase in enrollment of 4-5 percent each year, through 2010.

Reed warned that the CSU system would be unable to increase enrollment in 2004/05.

“ It’s the first time in the history of the master plan that there’s instructions not to grow,” Reed said, referring to the traditional agreement between the state and the CSU regarding funding.

The budget anticipates an increase of $24.7 million in fee revenue due to new enrollment growth.

The system will ask the legislature to fund what Reed called mandatory costs, totaling $57.6 million.

This includes $26 million for health-benefits increases for faculty, $9.5 million in compensation increases for faculty, $15 million or more for assorted insurance costs, including workers’ compensation and property insurance, $4 million for utility costs and $3.1 million to handle the assorted costs of opening new buildings.

The insurance request includes $5 million in fire losses within the last three months, which includes $3 million to compensate for the fire at the Fresno State lab school.

Reed will also request $5.7 million for financial aid, $100 million for a 4-percent faculty and staff increase and $25 million to improve technology, libraries and handle deferred maintenance duties.

Reed also wants the legislature to restore the $304 million in cuts made last year. “We’ll show the trustees a picture; it’s not a pretty picture,” Reed said.

While Reed does not anticipate further fee increases, he does not see a decrease in student fees either. “Fee increases will not be rescinded,” Reed said.

“ We’ll be lucky to get the [$300 million] back,” he said.

If further budget cuts are necessary, Reed said the CSU system will reduce winter and spring semester enrollment. “This budget deficit didn’t get here overnight and it won’t go away overnight,” he said.