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January 2009 1
2008-2009Cal Poly Budget
PresentationUPBAC
January 2009
January 2009 2
2002/03 2003/04 2004/05 3 Year Total
CSU ($105.4) ($285.3) ($131.6) ($522.3)
Cal Poly ($0.6) ($14.9) ($7.5) ($22.9)
Summary of Budget Reductions prior to Governor’s Compact Agreement with the CSU (in Millions) – net of fee increases
January 2009 3
Review of Compact for Higher Education2004-05
Covers six years – 2005/06 through 2010/11 Adjustments to the base budget:
3% annual increase for 2005/06 – 2006/07 4% annual increase for 2007/08 – 2010/11
An additional 1% annual increase to the base budget for 2008/09 – 2010/11 for equipment, technology, & libraries
State will cover annuitant dental benefits, retirement contributions and debt service
Identifies importance of restoring more competitive salaries for CSU employees
2.5% growth per year through 2010 – 8,000 FTES/10,000Headcount per year for CSU
January 2009 4
2005-2006 Final Budget Allocations First Year of Governor’s Compact 3% Increase in Operating Funds
Compensation Technology Deferred Maintenance
2.5% Enrollment Growth Funding Fee Increase for undergraduate and teacher
credential students (8%) and graduate students (10%)
January 2009 5
2006-2007 Final Budget Allocations 3% Increase in Operating Funds
Compensation Technology Deferred Maintenance
2.5% Enrollment Growth Funding Fee Increase “buy-out” for undergraduate and
teacher credential students (8%) and graduate students (10%)
January 2009 6
2007-2008 Final Budget Allocations 4% Increase in Operating Funds
Compensation Technology Deferred Maintenance
2.5% Enrollment Growth Funding Fee Increase for undergraduate, teacher
credential and graduate (10%)
January 2009 7
CSU Compensation Funding Shortfall for 2006-2007 and 2007-2008 CSU Cal Poly
Note: Bargaining commitments exceeded funding with or without the compact.
* A portion of the 2007-2008 shortfall was effective June 30, 2008
2006-2007 $10,600,000 $613,970
*2007-2008 $30,300,000 $1,746,954
January 2009 8
2008-2009 CSU Budget Negotiations Trustees Request
Based on Governor’s Compact 2.5% for Enrollment Growth $ 68.9M 4% for General Operations 116.9M 1% for Core Academic Support 29.2M 10% Fee Revenue Augmentation 73.1M
Governor’s Budget 10% Fee Revenue Increase $ 73.1M Budget Reduction (99.3)M
Final Budget – September 2008 10% Fee Revenue Increase $ 73.1M
January 2009 9
2008-2009 Cal Poly Operating Budget The net of the fee increase and the unfunded
mandatory cost resulted in a funding shortfall for Cal Poly of $3,002,082
January 2009 10
Since the 2008-2009 Final Budget…. October, 2008
Department of Finance directed state agencies and departments of the need to cut $390 million statewide. For the CSU this amount was $31.3million
For Cal Poly this amount was $1,653,400
November, 2008 Governor proposes an additional $66.3M reduction to CSU
Estimated cut to Cal Poly will be $3,500,000
Note: Cumulative reduction very close to the original reduction proposed in the 2008-2009 Governor’s Budget ($97.6M vs $99.3M)
January 2009 11
Summary of 2008-2009 Budget Reductions
2008-2009 Summary of Budget Reductions by Division
Division/Area% of Base
2008-2009 Final Sources and Uses Base Reduction
% of Base
October 2008 One-Time Reduction
% of Base
Estimated Mid-year One-Time
ReductionAcademic Affairs: Instruction 1.30% (1,282,710)$ -$ 1.51% (1,495,457)$ Academic Affairs: Other 1.87% (938,672)$ -$ 2.18% (1,094,358)$ Administration and Finance Division Total 1.87% (503,760)$ -$ 2.18% (587,313)$ President's Office & Legal Counsel Total 1.87% (31,054)$ -$ 2.18% (36,204)$ Student Affairs Division Total 1.87% (184,358)$ -$ 2.18% (214,936)$ University Advancement 1.87% (61,528)$ -$ 2.18% (71,732)$ Campus Contingency & Unallocated 1.87% -$ N/A (1,653,400)$ 2.18% -$ Total Reduction -1.30% (3,002,082)$ (1,653,400)$ -1.51% (3,500,000)$
January 2009 12
Situation continues to worsen…..
January 2009 13
Legislative Analyst's Office Report to the Joint Convention of the California Legislature December 8, 2008
2008-2009 Budget Package (September) Flat General Fund spending from 2007-08 to 2008-09
($103 billion) Reliance on one-time solutions Assumed 2009-10 operating shortfall of $6 billion
Updated November Projections $28 billion problem
$9 billion current-year problem $19 billion operating deficit in 2009-10
January 2009 14
Governor’s Special Session Proposals
Comes close to addressing shortfalls through 2010-2011
2008-2009 2009-2010Revenue Increases1.5 cent sales tax (three years) $3,540 $6,643Other (ongoing) $1,180 $2,943Totals $4,720 $9,586
Expenditure SavingsPropositions 98 $2,500 $729All Other $2,004 $5,391Totals $4,504 $6,120
(in Millions)
January 2009 15
Legislative Analyst's Office Report to the Joint Convention of the California Legislature If Gap was solved through Tax Increases
alone 2 cent sales tax increase 15% personal income tax surcharge 2 percentage point corporate tax rate increase
If Gap solved through spending reductions alone Eliminate funding for UC and CSU Eliminate funding for welfare payments Eliminate funding for developmental services,
mental health, and in-home supportive services
January 2009 16
2009-2010 Governor’s Budget – CSU(in millions) 10% Fee Revenue Increase $131.6
Special Session Reductions -66.3 BSN Nursing Program Increase
3.6 Mandatory Costs -84.6
Health, New Space, Energy, Financial Aid
Total Surplus/Deficit ($15.7)
January 2009 17
Cal Poly Funding vs. National Average
21.6%
12.3%42.5%
66.0%57.5%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
Cal Poly National Average (2004-05)
State University Fee Cal Poly's Other Fees/Tuition State Appropriation
January 2009 18
Cal Poly SUF vs. State Appropriation
10.1%19.2%
26.6%
89.9%80.8%
73.4%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
1987/88 1997/98 2007/08
State University Fee State Appropriation
January 2009 19
2005-06 % of High Cost Program SCU’s to Campus Total
SLO
San Jose
Humboldt
Pomona
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
0 5 10 15 20 25
January 2009 20
Fee Revenue % of Budget
National Average excluding California is 42.5% California's Average is 30.3%
California would have to increase student fees by approximately 69% to equal the national average
January 2009 21
Undergraduate Resident Student Fees at Comparison Universities
January 2009 22
Cal Poly Budget Goals and Principles Goals
Structurally balanced budget supporting: High quality academic programs. High quality faculty, students, and staff. Academic programs consistent with polytechnic mission and
the needs of the State of California. Student success demonstrated by high retention and
completion of degrees in a timely manner. Support services that demonstrate an adherence to
professional and ethical standards. Exemplary care of grounds and facilities.
Compliance with laws, policies, and quality service practices.
January 2009 23
Principles The Cal Poly budget is decentralized. Program decisions and budget management are the responsibilities of those
assigned with the management and leadership of their campus operating units.
Funding for program priorities is to be addressed first within the vice presidential divisions and, if needed, then through the campus Sources and Uses process.
The President, in consultation with the vice presidents, approves new funding priorities or funding reductions in the Sources and Uses process.
Budget and enrollment decisions are made with the entire campus in mind, including the impact on auxiliaries.
Enrollment must be consistent with available resources, including the campus-based fee revenue.
The University should adhere to an enrollment policy that stabilizes enrollments and minimizes enrollment oscillations.
The University budgetary process should be open and include all constituencies.
Faculty, students, and staff are entitled to timely budget, financial, and enrollment information.
Cal Poly Budget Goals and Principles