State Budget Crisis Hits Cal State East Bay

  • January 9, 2009

To: The Campus Community

From: President Mo Qayoumi

Earlier today, California State University Chancellor Charles Reed sent an e-mail to all CSU employees, addressing the serious impact of the current state budget impasse and grim prospects for the CSU in the governor's proposed state budget for 2009-2010. I urge you to review that message because it details measures that all CSU campuses must take to address this fiscal crisis while, at the same time, preserving access and quality for students, and maintaining jobs.

The chancellor announced a variety of actions to reduce costs system wide, including restrictions on travel, cancelling orders for non-critical equipment and supplies, and a hiring freeze for all positions except those essential to operations. In addition, a salary freeze through 2009-2010 has been implemented for all vice president level positions and above, including presidents, vice chancellors and the chancellor himself.

For the CSU, the governor's budget would make permanent $66.3 million in budget reductions proposed for 2008-09 and it assumes that the board of trustees will increase student fee rates by 10 percent (setting aside one-third for student financial aid).

As I explained in a communique to all employees and students on Dec. 1, the University has taken a strategic multiyear approach to its budgeting and is making decisions based on the priorities developed in our seven mandates, the Academic Plan, and the Strategic Planning Summary and Priorities for Implementation. Some of the most important decisions in this process have been made by the President's Cabinet, the college deans, and the associate vice presidents in consultation with the University Planning, Assessment and Budget Committee.

The combined effect of budget reductions for 2008-2009 and proposed additional reductions for 2009-2010 means that Cal State East Bay will have to start the new fiscal year on July 1 with a budget of $144.2 million, which is 7.7 percent smaller than it started with this year.

The President's Cabinet has approached making this reduction by identifying the core functions of the University, starting with direct instruction, student access, and academic quality. In each division, the vice presidents and their managers have proposed how they can provide basic services more effectively, using approaches such as the following:

  • consolidating functions with the goal of reducing the need for management positions;
  • streamlining admissions and evaluations processes;
  • enhancing online services and substituting self-service operations where appropriate; and
  • extending the length of time before computers and servers are replaced.

The University already has taken measures such as leaving positions unfilled as they become open through resignation or retirement and cancelling more than 150 courses and consolidation of others where enrollment levels are low.

Student Services Building Construction Halted

California's cash-flow crisis is also forcing all CSU campuses to suspend and shut down state-funded design and construction projects in response to the state's freezing of $600 million in general-obligation and lease revenue bonds used to finance these projects. System wide, hundreds of projects are affected. At CSUEB, all work on the Student Services and Administration Building has been halted until at least June 30. The cost to the state of this delay, and eventual re-start of construction, on a building already 65 percent complete could run as high as $1.5 million.

However, work will begin at the end of February on the new Hayward campus Recreation and Wellness Center because its funding comes from student fees and not state bonds. This $42 million, 55,000 square-foot facility will be located on the site of the current Student Services Hub.

The University Planning, Assessment and Budget Committee met today to review the latest budget data. Composed of faculty, staff, students and administrators, it will continue to be an important sounding board throughout this process. If you have ideas you would like the committee to consider, I invite you to send them to the chair of the committee, Dr. Michael Mahoney, provost and vice president for Academic Affairs, michael.mahoney@csueastbay.edu.

I will continue to meet with the cabinet, the Academic Senate, and other representative campus groups to share more information about the budget as it becomes available. I will continue to keep the entire campus community informed with periodic communiques.

Finally, I want to echo the chancellor's encouragement to our students, faculty, staff, alumni, and labor unions to work together to tell our elected officials and our East Bay business, community and civic leaders that higher education is an investment that benefits the entire state.

Thank you for your ongoing commitment to this great University.

KH

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