News from John D. Welty
- State Budget Cuts to CSU Impact Service to Students
- President Welty discusses 'daunting' budget situation
- Spring Assembly 2009 speech
- Message from Welty on fiscal crisis
- Fiscal Situation
Update: Budget Message From President Welty
February 23, 2009
Fresno State President John D. Welty offers a second video update on the ongoing state fiscal crisis and his plans.
The transcript of his message is presented below:
I was pleased that last week the legislature and governor acted to adop t a budget for the state of California for 2008-09 and 2009-10.
As we have analyzed that budget it appears that the proposal that the governor advanced in late December is in fact in the budet. The one addi tional item that appears in the budget that impacts Fresno State is the potential of an additional $50 million cut if the stimulus bill does n ot reach a certain level in the state of California by the first of April. We will be examining that in more detail. I think the good news is that the parameters that we have set to build our budget plan for 2009- 10 appear to be intact. Thus, the vice presidents and deans - - as they are working with in their areas - - will be using the same plan that they had adopted as they prepare their plans for Feb. 27. When I receive those plans on Feb. 27 I will then be forwarding that to the University Budget Committee for comment and it appears now that we will, in fact, be able to adopt a budget plan for the 2009-10 year by early to mid- April. As soon as I receive the budget plans from the vice presidents we will be issuing those more broadly and they will be placed on the Web site.
State Budget Cuts to CSU Impact Service to Students
February 20, 2009
The California State University will face an increasingly challenging fiscal situation over the next 17 months and beyond as a result of the budget package passed by the Legislature and signed by Gov. Arnold Schwarzenegger today (Feb. 20). The budget reduces state general fund support to the CSU for the current fiscal year, 2008-09, by $97.6 million, and calls for an additional $66.3 million cut for 2009-10.
Overall, the reduction places CSU $283 million below its operational needs, or approximately 10 percent.
Also, the 2009-10 budget includes an additional $50 million cut to the CSU, depending on the size and scope of the federal stimulus package.
"While we recognize the severity of the state's fiscal crisis, the budget does not provide the resources the system needs to meet the needs of our students and fund our operations," said CSU Chancellor Charles B. Reed. "This will impact our ability to maintain quality and services for our 450,000 current students, and we have already been forced to reduce incoming student enrollment levels for this fall."
Fresno State President John D. Welty said the university will be assessing the budget cut's impact on the campus.
"We are working diligently, quickly and collaboratively – in consultation with students, faculty, staff and administrators – on ways to minimize the impact of budget cuts on our students and on Fresno State's long-term educational mission, so vital to our region," he said. "I'm confident that our recently adopted campus budgeting principles are guiding us in the proper direction."
This is the second year in a row the CSU has received no funding for enrollment growth or increased operational costs such as energy and health benefits. CSU is already serving 10,000 students for whom the state provides no funding. As a result, the system has been forced to reduce enrollment levels by 10,000 this fall to align with student funding provided by the state.
As the CSU prepares the majority of California's workforce in key industries including nursing, agriculture, business, public administration and technology, the budget cuts will have a direct impact on the state's economy and limit CSU's ability to provide graduates for these key areas.
President Welty discusses 'daunting' budget situation
January 20, 2009
California State University, Fresno President John D. Welty discussed the campus budget at the annual Spring Faculty/Staff Assembly today (Jan. 20, 2009), noting that the university faces a "daunting" situation that will bring "painful" moments.
Welty said the current fiscal year still has many challenges, and he is focused onto ensuring that "we can cover salaries and mandatory obligations in this constrained environment."
"I am continuing the hiring freeze that was implemented in early 2008-09 and adding severe restrictions on travel and procurement activity. All of us must make efforts to curtail spending and preserve campus cash balances for all state, non-state and foundation funds," he said.
Fiscal uncertainty continues into 2009-10, and Welty announced a campus budget summit for Feb. 12. He and key university leaders will discuss how the campus might deal with potential funding reductions, and he is asking faculty and staff to offer suggestions. Budget reductions are expected, and the president said he is already working with the vice presidents to enact reductions in the most prudent and practical way possible.
"Although the situation worsens by the day, the Legislature and Governor talk, but don't act to resolve it," Welty said. "I urge all of you to contact your State Senator and Assemblymember and implore them to act immediately. We, as citizens – and our students – deserve and demand action."
Even though the state halted funding for thousands of public works projects, including the Fresno State Library, Fresno State will be able to open most of the library, but with sparse furnishings, Welty said.
"Because serving our students is our No. 1 priority, on Feb. 20 we will open the new north wing's collection level, first, second and third floors, as well as the renovated south wing."
Click here to read President Welty's entire speech.
Click here to view the Assembly.
Message from Welty on fiscal crisis
December 19, 2008
Dear Faculty, Staff, Alumni and Friends:
Like you, I have been following with concern the disturbing international, national and state economic news of recent months. As the state of California faces an unprecedented fiscal crisis, you may have questions and concerns about the impact on our university.
I want to reassure you that we have been making plans to meet these challenges for the past two years, when signs of a financial downturn appeared on our radar. When the California State University directed budget reductions at all 23 campuses this fall, we were well-prepared to act.
Let me offer you some information about our response to the challenges.
Prudent fiscal planning
Over the last five years, the campus fiscal strategy has involved planning for reductions by designating permanent funding on a one-time basis to campus initiatives. In fiscal year 2007-08 this flexible strategy allowed the campus to advance deferred maintenance, central technology initiatives and graduate program augmentations; however, because of its one-time designated funding strategy it's possible to suspend these initiatives in order to mitigate budget reductions to the campus community. Coming into Fiscal Year 2008-09, campus reserves from each Vice President, along with other central campus resources were applied to the initial $4.61 million base budget reductions in order to lessen the impact to the campus community.
On October 23, the CSU system was required to make a mid-year budget reduction totaling $31.1 million. At Fresno State, we were required to reduce spending by $1.7 million.
Our planning efforts allowed us to take immediate action: freezing all faculty and staff vacancies and an across-the-board three percent operating budget reduction. We made additional one-time cuts in deferred maintenance, Plan for Excellence projects, graduate education projects and technology to reach the $1.7M target.
While the steps we took were difficult, they were enacted with one goal: shielding students from any impact of budget reductions so that they could continue their progress toward completing their degrees.
Just two weeks later, on November 6, the governor proposed further budget reductions of $66.3 million to the CSU for the current budget. The proposed mid-year target would be added to the previous reduction to the final 2008-09 budget that was $215 million below CSU's operational needs.
That mid-year reduction has not yet been enacted. Anticipating further reductions, however, CSU Chancellor Reed declared systemwide impaction for 2009-10 because the system is serving 10,000 students for whom the state provides no funding. Therefore, the CSU must limit new admissions in 2009-10 to an enrollment supported by the state.
At Fresno State, we have been carefully managing our enrollment over the years and we are over-enrolled by only 2.8 percent. Our enrollment this fall is 22,622. Our target for 2009-10 is 22,100 – about 500 fewer new students.
Because we expect a further reduction in our state budget, we have developed a plan that includes across-the-board reductions in operating expenditures, reducing our reserves, student employment and equipment expenditures and continuing the position freeze. This will allow us to meet our commitments to students for spring semester classes.
Economic impact on our Endowment
In addition to state general fund budget reductions, the turmoil in the world financial markets has impacted our endowment, managed by the Fresno State Foundation. Endowment funds are used for scholarships for our students and also for funding certain chairs, professorships and programs. Our endowment, one of the largest in the CSU, was over $100 million in the first half of 2008 but has lost approximately 26 percent of its market value because of the stock market downturn.
Our Foundation's Board of Governors has been reviewing the impact on our endowment and will meet in early February to determine action for the coming year.
Legislative action needed
The California budget shortfall is the most serious in the state's history and worsens with each passing day. It is imperative that our Legislature take action quickly to address the situation. You may wish to contact your state Senator and Assemblymember and urge them to move swiftly on resolving the California fiscal crises.
Looking to the 2009-10 academic year
Our vice-presidents and I have been engaged in significant discussion and financial modeling as we consider next year's budget. We are working in the collaborative spirit that is a hallmark of our campus.
The governor will release his proposed budget in mid-January, and it will provide guidance for what we can expect in the next academic year. At our Spring Assembly on January 20, I will report on the proposed budget and its impact upon our campus. At that time, I will outline a planning process for 2009-10.
As in the past, our community will be invited to participate and we will rely upon our governance system to seek your ideas and to help review proposed actions. I also will put forth principles to help guide us as we develop these plans.
Year-end thanks
As our semester comes to a close, I'd like to express my heartfelt holiday greetings and my appreciation for all of your efforts.
While I don't have many answers to questions about what's ahead, I do know that we as a campus community have the commitment and strength to deal with whatever circumstances unfold.
Today, as perhaps never before, we need to work collaboratively and confidently to develop a plan and innovative solutions that will allow the entire University community to maintain and enhance our marvelous work.
The people at great universities, like Fresno State, work together in all times – difficult or not – to protect the academic mission and ensure that students continue to receive the excellent education to which they are entitled. I know that will always be our goal, because our students are our future.
I wish each of you a safe, restful holiday season.
John D. Welty
President
Fiscal Situation
October 23, 2008
As you know, we are experiencing a global economic crisis of extraordinary proportions. It is clear that this crisis is having an impact in the State of California, and the CSU has been informed by the state Department of Finance that the system needs to cut $31.3 million from the amount previously authorized in the 2008-09 budget. Fresno State's share of the reduction is $1,706,600. Therefore, we will take the following steps:
- Effective immediately, all position vacancies are frozen. Any exceptions to filling staff and managerial positions must be reviewed by Cabinet and approved by the President. Additionally all temporary, student or intermittent hiring should be approved by the appropriate Vice President.
- Effective immediately, all faculty searches are frozen. Any exceptions to filling faculty positions must be reviewed and approved by the Provost.
- Allocations to each divisional area for operating costs will be reduced by 3%. This reduction does not include personnel expenditures.
In addition, previously allocated funds are reduced by the following amounts:
- Plan for Excellence, $320,000
- Graduate Augmentation, $250,000
- Deferred Maintenance, $250,000
- Technology, $50,000
Though the Governor and the legislature have not made decisions on any additional cuts beyond the $31.3 million, Chancellor Reed has asked campus presidents – as a precautionary move – to review the impact of possible additional cuts and report back to him.
Our University community has previously faced difficult fiscal times, and we have worked together to resolve these issues and remained focused on our academic mission to provide opportunities for our students and to serve our region. Because we have been able to minimize disruption in the past few years through a spirit of cooperation and a commitment to one another, I am confident that we will work through this challenging fiscal situation. I shall continue to work with campus leadership as we face these very difficult times.
Thank you for your cooperation.
