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Uses of Revenue
Uses of Revenue

The 2017–18 CSU Support Budget recommends an expenditure plan based on increasing state General Fund and tuition revenue from enrollment growth in order to cover the cost of new expenditures. The expenditures outlined in this plan address the university’s fundamental priorities for the 2017–18 fiscal year. These include increases for Graduation Initiative 2025, employee compensation, enrollment growth, academic facilities and infrastructure, and mandatory costs.

Graduation Initiative 2025

The 2017–18 Support Budget plan includes $75 million for Graduation Initiative 2025. In 2009, the CSU set out to improve six-year completion rates and halve achievement gaps for first-time freshmen by 2015. With state support, the CSU was able to make modest investments in tenure-track hiring, increase course taking opportunities, enhance advising and education plans, improve academic and student support, and leverage data for campus decision making. Building on the success of Graduation Initiative 2009 the CSU decided, in consultation with campus leaders and other key stakeholders, to raise the bar even higher.

Graduation Initiative 2025 is focused on aggressive goals for both freshman and transfer students. By more than doubling the four-year rate from 19 percent to 40 percent systemwide and raising the six-year rate from 52 percent to 70 percent for freshmen, in combination with two- and four-year graduation rate goals for transfer students, the CSU will contribute its share of the bachelor’s degrees needed in California by 2030. The CSU is also committed to fully eliminating achievement gaps for underrepresented, low-income and first-generation students. The $75 million request represents the first year of a multi-year investment that is needed in order to achieve the CSU’s ambitious new graduation and student success goals.

Five Priority Areas for Graduation Initiative 2025

With $75 million distributed across the CSU based upon an allocation model which considers the student populations of each campus, these resources will allow campuses to prioritize the investments they make to improve time to degree, eliminate student achievement gaps, and ensure every student has access to the tools, resources and guidance needed to achieve.

  1. Tenure-Track Faculty Hiring: Campuses will continue to prioritize the hiring of tenure-track faculty and to improve the ratio of tenure and tenure-track faculty to lecturers, as well as improve student/faculty ratios. These funds will enable campuses to hire more tenured and tenure-track faculty systemwide. This increase will provide opportunities to offer more sections of high-demand courses.
  2. Improved Course Taking Opportunities: Campuses will develop infrastructure to accurately predict student demand for course sections, will organize the schedule of classes to prioritize the delivery of courses required for degree completion, and will strategically allocate campus resources to align with demand throughout the college year.
  3. Enhanced Advising and Education Plans: Through the hiring of more professional staff advisors and investing in the use of technology to provide clear and accurate education plans, the CSU has prioritized this critical component of academic and student success. Investing in advising will improve opportunities for students to focus on specific academic and career goals, improving both student services and institutional efficiency.
  4. Academic and Student Support: By identifying and supporting academic and student services and programs which have systemic, campus-wide impact, campuses will scale-up a range of successful strategies to improve retention and completion.
  5. Actively Leveraging Data: Campuses will continue investment in improving student information systems and the use of available data to facilitate more strategic and intentional campus decision making.

Compensation Increase

The CSU Board of Trustees recognizes comp​en​sation for faculty, staff and management as a key element of the university’s success. Continued investment to make progress toward competitive salaries is critical for the CSU to fulfill its primary mission of access to an affordable and high-quality education. A competitive compensation package is essential to the CSU’s ability to recruit and retain faculty, staff and management employees who contribute to the CSU’s mission of excellence.

This budget plan calls for approximately $194.2 million to fund compensation increases, which consists of two parts: current contracts ($139.1 million) and a compensation pool increase for new contracts open in 2017–18 and non-represented employee groups ($55.1 million).

Current Contracts: $139,138,000

T​he $139.1 million for current compensation commitments includes permanent replacement of one-time funds toward compensation costs in 2016–17 ($33.0 million), costs associated with a June 30, 2017 increase ($21.9 million), and costs associated with a July 1, 2017 compensation increase ($84.2 million) for faculty and staff with existing collective bargaining agreements.

Open Contracts &​ Non-Represented Staff: $55,056,000

The $55.1 million for new contracts will fund a compensation pool increase effective July 1, 2017 for represented and non-represented employee groups without existing commitments for 2017–18.

Funded Student Enrollment: $38,​507,000

The 2017–18 budget plan includes one percent enrollment growth, which is equal to 3,616 California resident FTES based on a 2016–17 enrollment base of 361,644.

​2016-17 Resident FTES Base​361,644
​2017-18 Resident Student Enrollment Growth (1%)​3,616
​2017-18 RESIDENT FEES​365,260​

 

The cost to fund one percent enrollment growth is derived using a marginal cost rate of $10,649 per FTES. New enrollment requires new funds for direct instruction, academic support, student services, institutional support, and plant operations totaling $38.5 million.

Academic Facilities and Infrastructure: $10,000,000

The 2017–18 budget proposes $10 million to address the CSU’s most urgent facilities maintenance and utilities infrastructure needs. Under current bond market conditions, this amount would finance approximately $150 million for much needed capital projects. The CSU prioritizes critical infrastructure and utility renewal projects and facility renovation to support academic program needs. The $10 million request will also enable the CSU to fund limited physical capacity growth to serve growing student enrollment.

However, the budget request will only allow the CSU to keep pace with our aging infrastructure. It will not reduce the deferred maintenance backlog, which currently stands at approximately $2 billion, when funded projects are completed. The backlog is expected to grow at an estimated $143 million per year as facilities continue to age and limited funds are available.

Mandatory Costs: $26,000,000

Mandatory costs are expenditures the university must pay regardless of the level of funding allocated by the state, and they often increase independent of the state budget condition. These costs include increases for employee health, dental and retirement benefits, and the operations and maintenance of newly constructed facilities. Additionally, funding is included in 2017–18 to address increasingly greater compensation costs due to changes in federal overtime rules and state minimum wage laws. Without funding for these types of mandatory cost increases, campuses must redirect resources from other program areas to meet these obligations. In order to preserve the integrity of CSU programs, the 2017–18 plan provides for the following increases in mandatory cost obligations.

​Health Benefits​$912,000
​Dental Benefits​2,429,000​​
​Retirement Benefits​7,000,000​​
​Maintenance of New Facilities​776,000
​Federal and State Mandates​14,883,000
​Total​$26,000,000