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University Update

University Update

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TO: All Faculty and Staff
FROM: Sally Roush, Vice President, Business and Financial Affairs

Sept. 25, 2008

Budget Message #8

On Tuesday, Governor Schwarzenegger signed a $144.5 billion budget plan for the state for the fiscal year that started July 1.

The approved budget as it affects the CSU, and thus SDSU, relies on the Governor's May revised budget which added back to the CSU approximately $97 million. For SDSU, our planned $12.3 million reduction thus becomes $4.4 million across all divisions of the university. This is good news only in the short run. Challenges remain, which we are meeting through reduced enrollment, larger class sizes and reduced spending.

Reduced funding also will impact salary increases. Because the Higher Education Compact with the Governor was not funded, the CSU will have to reopen salary and benefits negotiations with many of its labor unions for fiscal year 2008-09. The collective bargaining contracts have provisions that require the unions and the CSU to meet and confer over compensation, in the event that the CSU did not receive the level of funding contained in the Compact with the Governor.

As reported by numerous analysts, the 2008/09 approved California budget does not address the underlying structural problems that have repeatedly created huge gaps between California's spending commitments and revenues. Therefore it is very possible that there will be mid-year budget reductions, and that almost certainly there will be further budget reductions in fiscal 2009/10.

The President's Budget Advisory Committee (PBAC) at SDSU will meet in October to review numerous budget issues including the final approved state budget, our actual enrollment and revenue collections for the fall 2008 semester, and to discuss how best to position the university in light of possible mid-year reductions and/or a further reduction in 2009/10. In the past, such PBAC deliberations have proven valuable in preparing for future budget issues.

I appreciate the support demonstrated by our participation in the Alliance for the CSU. Those activities surely resulted in a better budget outcome for the CSU and SDSU. I anticipate that the Alliance efforts will continue to be important going forward, and I urge you to remain informed about the budget.