Got any good New Years resolutions? Well, Governor Schwarzenegger thinks he has one: he started the year a bit early by having his Department of Finance director, Mike Genest, unveil his (the Governor’s) 2009/10 budget proposal on December 31. The Governor was not present, and, once again, there wasn’t much good news. The proposal marked the starting point of a process that will culminate in next year’s state budget, effective July 1.

 

In his budget proposal, the Governor continues the themes of his legislative special session proposals, including some tax increases mixed with some budget cuts, the latter targeting public employees and eroding state programs. For example, it features one two-day furlough per month and the loss of two holidays for civil service employees. That concept was raised in the special session for the current budget year and was also in a bargaining proposal to SEIU Local 1000. The state will close many state offices the first and third Fridays of each month starting in February, with employees not being paid for those days.

 

According to the CSU response to midyear cuts, CSU won’t implement the request from the Governor, and there is no immediate threat to the salaries or holidays of represented employees in the CSU system.

 

The true impact of the Governor’s proposal on the CSU budget will not be known for some time, as the Legislature still has to finish the work on the mid-year budget problem. The CSU has projected those impacts in its CSU Response to 2009/2010 Governor's budget. By all measures, the Governor’s budget does not fully fund the CSU and falls way below the higher education compact that, until the very recent past, funded enrollment growth and compensation increases. In addition, the Governor’s budget assumes a 10 percent student fee increase to backfill some of the general fund budget cuts. The end result is that the proposed budget is “flat,” that is, it’s the same funding level as last year and does not fund some of the ongoing increased costs within the CSU system. The CSU ends up with a negative funding of $15 million below last year when accounting for costs, increased student fees notwithstanding.

 

The CSU Trustees request is best represented in its 2009/2010 Budget plan summary, outlining two years of budgets and a third-year request. It is important to note that the CSU budget is made up of about 70 percent general fund dollars and the remainder from student fees, grants and contracts. The state budget crisis impacts the CSU directly, because the general fund is made up of tax dollars that are allocated by the legislature and signed by the Governor in the budget each year.

 

Why should you care? If you work for the CSU or want the CSU continue its mission, you must understand it’s in your interest to support revenue solutions for the state budget. Yes, that means taxes of some fashion, all in an effort to help stabilize the state budget and prevent deep cuts to the CSU and other state agencies.

 

 

The National Conference of State Legislatures has issued a report showing that only 12 states have sound budgets with no projected deficit. These numbers were issued last November, and, if anything, things have gotten worse since then. It is clear that some relief for the states is needed from Washington D.C. to help shore up programs and services. California’s problems gets worse the second year. That is why there needs to be a revenue solution to improve the annualized budget picture so not to destroy whole programs with deep cuts.

 

The Chronicle of Higher Education reports: “As state legislatures convene in the coming days and weeks, colleges will be battling to stave off large cuts, with governors in places like Arizona, Missouri, and Ohio asking public colleges to prepare for budget reductions of as much as 25 percent.”

 

There is no easy solution, but more and more universities see that the only alternative may be revenue increases from taxes or student fees. The alternative would be deep program cuts.

 

This budget year will be one of the more challenging ones. It will be important for everyone to know the impacts and what is at stake. Although the CSU won’t suffer cuts as deep as some other state programs, there are no guarantees, so that could change at any moment.

 

The causes for concern seem to be coming from all sides: I received some brief feedback from a legislator today indicating that no budget solution is close to being voted on and that no one at the Capitol really has any idea when there will be one. This is a time for everyone to stay informed and to make their voices heard.

 

 

# # #

 

 

0 comment(s) so far...

Login to Add Your Comment