Welcome back to another year at The Beach!
I love the excitement of starting a new school year. I want you
to know how proud I am to serve as your President. I have never
had a better job and I have never worked with a better group of
men and women.
This is the ninth year that I have shared
a budget message with you and I am pleased to tell you that I believe
this year's budget is a responsible one, especially in light of
the current state and national economic climate. After extended
negotiations, the Governor signed the 2002-2003 State Budget on
September 5th. While many state and local government entities experienced
an overall reduction in their budgets, the final budget provides
the CSU with a modest increase which will fund the System's two
highest priorities: enrollment growth and salary increases for our
employees. As we go through the academic year, we must remain mindful,
however, that the State's financial uncertainty could result in
changes in our budget for this fiscal year.
Chancellor Reed is to be commended for his
leadership and political effectiveness during an uncertain budget
year in Sacramento. I also want to thank the Board of Trustees for
securing a budget that allows the CSU to respond to the educational
needs of our students. As I reflect on this budget message, I am
grateful for the excellent planning process that we have on this
campus. I am very appreciative of the diligent work of the Resource
Planning Process (RPP) Task Force in developing a very prudent and
responsible budget plan for the University.
California's Economy and the Budget
The State Budget was constructed during
an economic downturn that has left California with an estimated
$23.6 billion budget shortfall. Given the current fiscal conditions,
the Governor could not fully fund the Trustees' entire budget request
for fiscal year 2002-2003. Nevertheless, I believe higher education
fared well in the budget process. The final State Budget provides
a net increase in general fund support for the CSU, and for the
eighth consecutive year, there will be no increase in system-wide
mandatory student fees for California residents.
Mandatory budget cuts that we were asked
to make earlier in the year were offset by additional funds to accommodate
the increase in student enrollment that we experienced last year.
The budget provides for a modest 1.5% average salary pool, which
helps us maintain our commitment to provide competitive salaries
and to attract and retain the very best faculty scholars and most
talented staff. Even though we face some difficult budget conditions
in the near future, we remain committed to continuing our work with
the Chancellor's Office in support of keeping faculty and staff
Compensation remains a high priority and
we will continue to seek additional salary fiends as the State's
I am delighted that CSULB continues to be
one of the most popular institutions in California. We have built
a successful student recruitment program that continues to attract
high-achieving students, while maintaining our historical commitment
to access Applications received for the fall term numbered over
43,000, which is a 10% increase over last year's level and an all-time
high for this campus. This fall, we will have approximately 34,600
students studying on the campus, which is 1,300 more students than
The quality of the applicants is equally
impressive, particularly for the freshman class. With an average
GPA of 3.41, I believe we may have the most academically prepared
freshman class in the history of this campus. It is good to see
that 97% of our freshmen are full-time students who will draw on
our full range of services and participate in the many exciting
activities available on our campus. Our residence halls are at full
occupancy with waiting lists of students who want to live on campus.
This year, we will have 101 new President's
Scholars, which means we will have a total of 377 California Valedictorians
and National Merit scholars studying on the campus. This talented
pool of students continues to transform our campus community.
Our greatest challenge continues to be how
we deal with the institution's increased popularity as a campus
of choice for high-achieving students. We are simply growing too
fast! As I have said before, this is a good problem for the University
Controlling enrollment growth, however, is
the critical first step in maintaining our educational effectiveness.
We must have a sound enrollment plan that attempts to "right-size"
the campus to match our available resources. This will ensure that
the students we do enroll get the classes they need and can make
timely progress toward their degree objectives. This Fall is the
first term that the freshmen admission standards were higher than
the regular CSU requirements.
Our Enrollment Management Committee, which
has been formalized as an Academic Senate committee, is charged
with monitoring our enrollment trends and recommending adjustments
to the admissions criteria to ensure optimum size and our commitment
to a diverse student population.
The economic downturn increases the challenges
that the University faces in maintaining the momentum achieved over
the years. It places an even heavier dependence on emphasizing the
University's endowment and fund-raising activities. As many of you
know and have heard me say before, I am absolutely convinced that
continuing to build our endowment is the right way to secure the
future of this University.
New Campus Budget Authorization for 2002-2003 and Contingency Planning
This year's budget planning was particularly
challenging because of the possibility of several widely differing
outcomes, including the knowledge that the State may face similar
budget challenges for the next few years. Fortunately, most of what
the Governor proposed in the May Revise survived in the final budget.
Therefore, I am able to support all of RPP's recommendations for
fiscal year 2002-2003.
CSULB will receive a General Fund increase
of roughly $13 million, or a 5% increase over last year's budget.
Of this amount, $6.5 million is earmarked for employees' compensation
and benefits, with the balance being used to offset budget cuts
from the State and to cover mandatory expenditures. We also have
carryover funds from the prior year, which permits me to authorize
a non-base allocation of $2.029 million to the Division of Academic
Affairs for new faculty to accommodate our increased academic year
enrollment target of 835 full-time equivalent students.
While the allocation for additional faculty
resources is the only new authorization, the 2001-2002 base budgets
for all operating divisions will be preserved. This will provide
the colleges and other units with some much-needed stability as
we face another difficult and uncertain budget planning year.
Considering that there is a high probability
for a leaner budget in 2003-2004, including the possibility of a
mid-year reduction in our base budget, I am asking each of the divisions
to maintain their contingency planning through the Fall semester
until we can make a better assessment of the potential risks we
are likely to face in the next fiscal year and thereafter.
I am very proud of the way in which all
of you have managed your budgets over the past twelve months. I
am absolutely convinced that we can continue the vigorous momentum
that we have built over the past few years. As we continue to work
together in a committed, caring and collegial environment, I am
confident that the frailties of the economy will not keep us from
accomplishing our goals.
Thank you for your support and your individual
contributions to CSULB. This University is truly a wonderful place
in which to work, teach and learn. I hope you know how proud I am
to serve you as your President.