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May Budget Revision Restores $366M to CSU

Chancellor Charles Reed says reinvestment in higher education is vital to the state’s economic recovery.

Gov. Arnold Schwarzenegger’s May revision of the state budget continues to include the proposed restoration of $305 million to the California State University’s 2010-11 budget, as well as an additional $60.6 million to support enrollment growth across the CSU’s 23 campuses.

"Gov. Schwarzenegger has made supporting higher education a priority and we appreciate the continued commitment of his administration," said CSU Chancellor Charles B. Reed in a statement released May 14.

"The return of these funds will allow us to restore and preserve student access at campuses across the state. By reinvesting in California’s public universities, we will all ultimately benefit from the creation of jobs, which is vital to the state’s economic recovery and prosperity."

CSU's Economic Impact on the State

An updated economic impact study released earlier this week by the CSU reported that CSU-related expenditures support more than 150,000 jobs and create more than $17 billion in economic activity annually. 

The report found that SDSU contributes $6.5 billion annually, roughly 36 percent of the entire CSU's impact in California. Additionally, every $1 that the state invests in the CSU has a return on investment of $5.43. 

Restoration serves more students

The $305 million would serve to backfill a "one-time" reduction to the CSU budget for 2009-2010 and would allow the university to serve 21,000 more students than it can serve under existing state funding levels. The $60.6 million would fund the expansion of enrollment by more than 8,000 additional students system-wide. 

In the governor’s January proposal, this additional enrollment funding was contingent upon the state receiving a threshold amount in federal aid for other state programs. The May revision removes this contingency. 

In addition, the governor's May budget revision proposal includes the restoration of new competitive CalGrant awards, which would benefit an estimated 1,600 CSU students and thousands of community college students who will ultimately transfer to the CSU.

Despite this additional proposed funding, the CSU’s level of state-funded support remains well below that of previous years. Since 2007-08, the CSU has seen a reduction of $625 million in state support. To offset the lack of funding, the CSU implemented cost-cutting measures including enrollment cuts, student fee hikes, employee furloughs and layoffs.

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