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Battered by the coronavirus and the related drop in state revenues, Gov. Gavin Newsom’s newly revised proposed budget for 2020-21 would deal California’s public colleges and universities a double blow: withdrawing promises of substantially higher state support and, instead, cutting funding by about 10% from current levels.
Newsom repeatedly said that the impact of the proposed cuts to the California community colleges, University of California and the California State University systems could be reduced or eliminated if the federal government provides enough additional money to the states through legislation now proposed by Congressional Democrats.
To offset those cuts fully would require about $1 billion for community colleges, $376 million for UC and $404 million for CSU.
Unless that federal rescue occurs, the 10-campus UC system and 23-campus CSU system are likely to face difficult choices in coming months about possible tuition increases, pay cuts and reductions in academic programs and services not seen since the Great Recession more than a decade ago. The 115 community colleges face similar choices at a time when unemployment is expected to send more adult students to them for retraining.
The cuts to the system’s budgets come as colleges and universities across the state have shifted to online instruction because of the spread of the virus. CSU’s campuses and some community colleges are already planning to continue holding most classes virtually in the fall.
UC president Janet Napolitano on Wednesday issued a general statement saying that UC will work with the legislature for additional funding “to see us through this difficult time” and that the focus will remain on teaching, research and public service, including the patient care provided by UC medical centers during the pandemic.
“UC stands with the governor and the legislature to help lift the State out of this economic crisis,” Napolitano said.
UC and CSU officials said it was too soon to offer details about how they would cope with the budget if it does not change much by the time the Legislature passes it by mid-June. Newsom’s plan was notably silent on tuition and his staff said it was premature for him to take a position on tuition before the universities decide whether to pursue increases.
In one silver lining for higher education in Thursday’s proposal, Newsom did not recommend major reductions to the Cal Grant program. Cal Grants are financial aid awards that don’t need to be paid back and are awarded each year to hundreds of thousands of students at community colleges, as well as CSU, UC and private campuses. The only cut Newsom recommended for Cal Grants was to reduce the maximum available award for students attending private nonprofit institutions, from $9,084 to $8,056.
In January, Newsom had proposed a relatively generous budget with funding to be upped 5% for the universities and 4% for community colleges at a time when the state projected a large revenue surplus. But now, UC would receive about $3.5 billion in state funds, which is 15% less than the January proposal. CSU would get about $3.6 billion, 14% less than the January plan; the community college system is slated for $5.4 billion in state funds, 17% less than proposed in January.
However, Newsom also proposed what is essentially an IOU for community colleges worth $662 million for the 2020-21 academic year. Officially called a deferral payment, the colleges could use their reserves or borrow money to spend $662 million during the 2020-21 academic year, which would help minimize cuts. The state would then pay them back in 2021-22.
While public higher education also receives large revenues from tuition, grants, donations and federal programs, administrators say state funding is key to basic education.
Napolitano said UC “recognizes the unprecedented challenges California is facing in the wake of COVID-19 and regrets that Gov. Newsom was put into a position to steeply reduce the University’s budget in response to the State’s dramatically diminished revenues.”
Students are very worried about how possible tuition hikes and program cuts would make UC “less affordable and accessible for students who are low-income and/or from underrepresented communities of color,” according to Varsha Sarveshwar, president of the UC Student Association.
“Devastating cuts during a devastating time for California,” Sarveshwar, who is a senior at UC Berkeley, said. “This budget underscores the need for the federal government to take responsibility and support our schools.”
CSU Chancellor Timothy P. White said in a statement that Newsom’s budget revision “is indeed daunting and portends challenging times across the California State University and the entire state.”
White cited students’ determination to pursue higher education ‘is a perfect model for how we will collectively work together to overcome the current and future challenges posed by the pandemic and the state’s economic picture.”
Charles Toombs, president of the California Faculty Association, the CSU faculty union, said he appreciated the preservation of Cal Grant eligibility but said that Newsom’s proposed cuts are “not solving the budget crisis with a lens on equity, as he claimed in his remarks Thursday.”
“We do not want to see a repeat of what happened in the last recession when faculty and students suffered through furloughs, increased class sizes, limited class offerings and tuition increases, while the CSU actually saved and hoarded funds,” said Toombs, a San Diego State professor. Highlighting past controversies over CSU cash reserves, he called on the system to spend those rainy day funds.
The California community college system, the largest higher education system in the nation serving more than 2 million students across 115 colleges, will also see major cuts.
Eloy Ortiz Oakley, chancellor of the community college system, said in a statement that he understands California faces a “difficult fiscal condition” amid the pandemic. But he added that “now is the time to support and strengthen” colleges.
In what would be the most significant cut for community colleges, Newsom is proposing to slash the dollars available through the Student Centered Funding Formula by $593 million, a reduction of about 10% “when combined with a foregone cost-of-living adjustment,” according to the revised budget.
The Student Centered Funding Formula, the main funding source for community colleges, is allocated based on schools’ numbers of low-income students, as well as their graduation and transfer rates.
The revised budget proposal also calls for decreasing spending on the system’s Strong Workforce Program by $135.6 million — a cut of more than 50%. That program aims to improve the quality and expand enrollment at career and technical education programs.
Newsom also proposed a $68 million cut to a program helping low-income students, foster youth, those with disabilities and other high-needs students. He also walked back several proposals for new spending that were featured in his January budget, including: $83.2 million to support apprenticeship programs; $31.9 million for enrollment growth; $11.4 million to support food pantries and $5.8 million to fund staff members who help undocumented students access financial aid and other resources.
Newsom noted the importance of protecting funding and eligibility for Cal Grants, which went mostly untouched.
Caroline Siegel Singh, a student commissioner on the California Student Aid Commission, which oversees the Cal Grant program, said in a statement that “now more than ever, students are struggling to afford their basic needs such as housing and food.”
“I applaud the Governor for prioritizing the Cal Grant program and the low-income California students that it serves,” Siegel Singh said.
Newsom said he would propose legislation that would allow colleges and universities to tap into surpluses in funds from such activities as parking, housing and meal plans. Those funds are usually held separately from the regular budgets and Newsom wants that changed so some of that money can go to programs that help low-income and under-represented minority students and to support online courses.
Newsom and his staff emphasized that in response to the shift to online learning, all of higher education in California — community colleges, UC and CSU — should collaborate on a joint online learning platform that would allow students to more easily find and take classes online.
At Thursday’s press conference, Keely Bosler, state finance director, praised the work “in really perfecting and experimenting with new ways” to do online learning. She added that the governor does not want online learning to replace in-person classroom learning but said it is an important opportunity for working adults and parents of young children to take online classes at nights and weekends.
Education advocates said additional federal dollars are key.
“Governor Newsom had difficult decisions to make in this 2020-21 budget proposal but it is clear things will get significantly worse if the federal government fails to provide needed assistance,” said Michele Siqueiros, president of the Campaign for College Opportunity, an organization that works to broaden college access.
Without that extra federal aid, she added, “draconian cuts to California’s colleges and universities threaten access, financial aid and college completion, ultimately hurting the state’s long-term economic stability.”
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