1. January 20091 2008-2009 Cal Poly Budget Presentation UPBAC January 2009

2. 2 Summary of Budget Reductions prior to Governor’s Compact Agreement with the CSU (in Millions) – net of fee increases

3. January 20093 Review of Compact for Higher Education 2004-05 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

4. January 20094 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%)

5. January 20095 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%)

6. January 20096 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%)

7. January 20097 CSU Compensation Funding Shortfall for 2006-2007 and 2007-2008 CSUCal 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

8. January 20098 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

9. January 20099 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

10. January 200910 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)

11. January 200911 Summary of 2008-2009 Budget Reductions

12. January 200912 Situation continues to worsen…..

13. January 200913 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

14. January 200914 Governor’s Special Session Proposals Comes close to addressing shortfalls through 2010-2011

15. January 200915 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

16. January 200916 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)

17. January 200917 Cal Poly Funding vs. National Average

18. January 200918 Cal Poly SUF vs. State Appropriation

19. January 200919 2005-06 % of High Cost Program SCU’s to Campus Total

20. January 200920 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

21. January 200921 Undergraduate Resident Student Fees at Comparison Universities

22. January 200922 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.

23. January 200923 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