More than 90 percent of the 23,000 workers at 23 CSU campuses represented by the California Faculty Association campuses have voted in favor of striking unless they receive three years of annual pay raises of 5 percent, not the 2 percent annual raises offered by the state. A rally last week in Long Beach called by the CFA was attended by more than 1,000 people, Reuters reported. The wire service’s story illustrated a seemingly united CSU faculty:

“People are suffering and hurting financially,” said Theresa Montaño, a vice president of the California Teachers Association. “Faculty members can’t pay off their debt, raise a family or buy a home.”

 

During the march, many protesters said that if faculty members don’t get the salary increase, they are ready to walk off the job. …

 

Jennifer Eagan, a president for CFA, said it’s “unfair to ask professors keep sacrificing year after year without a significant pay increase.”

Faculty seek help from union-friendly state agency

The CFA further escalated its fight with the state government on Thursday by filing an unfair labor practices allegation with the state Public Employment Relations Board. This description is from the CFA’s website:

The charge is based on language in HEERA [the Higher Education Employer-Employee Relations Act] which requires that the CSU and CFA reach an agreement on salary before the university sends a budget request to the Legislature and governor.

 

In fact, in both 2015-16 and 2016-17 the CSU made Support Budget requests that included their plan to implement a 2 percent faculty salary increase for each year. By making a budget request prior to reaching agreement with CFA on what would be needed to offer an adequate salary pool and by arguing that they have “allocated $65.5 million for a 2 percent compensation pool for all employees,” and limiting discussion of salary to that predetermined pool, the CSU has “violated its duty to meet and confer with CFA in good faith.”

 

In his remarks to the Board of Trustees on Wednesday November 18 Kevin Wehr highlighted the problem. “What you fail to understand is that deciding what you think is fair compensation for your employees before the bargaining process even begins is not bargaining in good faith,” Wehr said. “Indeed Section 3572b HEERA of recognizes that fact and says that once we reach an agreement ‘an appropriate request for financing or budgetary funding for all state-funded employees … shall be forwarded … to the Legislature and the Governor.’ You have put the cart before the horse.”

PERB has consistently ruled in favor of local government unions challenging “bad faith” decisions by governments on changes in compensation. This time, however, the ultimate target isn’t the cities of San Jose or San Diego or the Los Angeles Unified School District — it’s Gov. Jerry Brown, who cleaned house at PERB in 2011 and removed leaders chosen by Gov. Arnold Schwarzenegger, who had fought with the California Nurses Association for years.

The union seeks a 5 percent raise across the board for its members, which include teachers, librarians and counselors.

The university system is offering a 2 percent increase and says it has already boosted faculty pay by $65.5 million over the past two years.

The system’s senior faculty members were paid an average of $96,000 per academic year as of April, according to the last figures available from Cal State.

Divided on Contracting

While the issue is money, lobbying records show a divide on several other issues, most recently the use of contract employees.

Senate Bill 669 introduced earlier this year by Sen. Richard Pan, D-Sacramento, aimed at refining the parameters of contract hiring. The university opposed the measure while the union backed it and spent money lobbying for it, records show.

The legislation would have placed stricter oversight on the use of contracted employees, which is already part of the collective bargaining agreement between the union and the university.

The agreement allows contracting as long as it does not displace union members or require them to move to another campus that would require relocation, among other conditions.

The agreement also requires the university system to consider union employees for any contracting chores, provided the employees have the required skills.  

The bill was scrapped, but a similar measure restricting the University of California system, Senate Bill 376, was supported in testimony by Pat Gantt, president of California State University Employees Union.

That bill passed but was vetoed by Gov. Brown.

Both bills are similar to a measure introduced last session seeking to do the same thing. That bill failed in committee.

RELATED – How California State University beats the tuition hike freeze

Additional Legislation Causes Clashes

Last year, the two parties clashed on several other measures. Among them was Assembly Bill 2721, which would have required the university system to add another member to the board of trustees.

The measure was crafted by the union and carried by Sen. Pan in hopes of putting someone on the board to exclusively represent union interests.

The measure sailed through both chambers, 78-0 in the House and 33-1 in the Senate.

Brown vetoed the legislation, though, writing, “Since the Board of Trustees was established in 1960, there have only been four additions to the Board. The last of these was the addition of the non-voting student member in 1999.  I am not persuaded that increasing the membership of the Board beyond 25 is necessary.”

The union accused the university of “fear-mongering” regarding a measure that would have better defined extended education classes and how they applied to undergraduates.

It claimed the system was telling union members that the bill would result in layoffs. The union, which along with several other organized labor groups who backed the measure, advised its membership to ignore the threats.

The bill, carried by Assemblyman Adam C. Gray, D-Merced, died in committee.

Lobbying for Favor

Cal State’s administration and the union have both spent generously on lobbying over the past several years, often at odds.

California State this year has spent $92,000 on lobbying through June while the union has spent $83,760, records show.

Last year, the university spent $396,545 on lobby-related activities while the union spent $248,446.

The union’s political action committee spends heavily on the annual lobby days in April, bringing in members and running up bills for hotels and airfare. This year, the union spent $15,000 on promotional materials with a Massachusetts-based company. 

The California State University system has increased student activity fees to offset a tuition freeze, making parking and health services more expensive.

The union insists that the average CSU salary for union members has increased 8 percent since 2004, rising from $46,362 to $50,179 in 2014, while the average pay for a campus president has risen 44 percent, from $218,871 in 2004 to $314,357 in 2014.

CSU contends the proposed 2 percent raise is fair. In a statement from earlier this month, it says “the 2 percent compensation increase costs $32.8 million. The 6.2 percent total salary increase the CFA is proposing costs $101.7 million. The CSU will continue to work to improve compensation for all employees but must balance all critical priorities that support student success.”

In 2010, the California State University system issued $352 million in revenue bonds. Earlier this month, it issued $1.1 billion of the same thing. The debt issuance is standard, generally considered to be part of the process to keep pace with growth. And financial disclosures are rich with information; people can go to prison for lying on these things.

Comparing the two issuances is a tour of the massive growth of the education industrial complex, a waltz through the luxury world of public, higher education.

Sky-rocketing revenues

According to the bond filings, gross revenues in the system more than doubled in the last 10 years, from $608.7 million in 2005 to $1.57 billion in 2014. The increases were generated across the board, in fees from parking to health facilities to the student union, and from continuing education to housing.

The revenue has started flowing from places other than tuition, which has remained the same since 2011 after increasing 60 percent for full-time undergrad students between 2005 and 2009 to $4,026.

Those increases incensed students, and protests forced bureaucrats to pay attention. Proposition 30, passed by voters in 2012, increased personal income tax on people making over $250,000 to fund education as well. That increase is scheduled to end in 2019.

In the meantime, though, schools have figured out other ways into the wallets of students, thus the increased fees.

Cost of an education

A student in 2010 paid $6,427 to live on-campus, support the student union and use the health facility. The same package today costs $7,958, or 23 percent more.

Students are trying to adjust. Some are living off-campus, which has become a cheaper alternative to the dorm.

Fees aren’t the only way the system has made money. While state funding has waxed and waned, the system increased private fundraising and government grant proceeds, from $1.2 billion in 2005 to $2.1 billion in 2014. The system notes that “amounts shown are not included as part of the gross revenues and generally are restricted to specified uses.”

Growth in the number of staff has sharply outpaced increases in the number of students they serve, with growth among administrators and faculty roughly triple that of students.

Between 2010 and 2015 the number of administrators and faculty grew from 47,000 to 57,000  – or 21 percent – while rank-and-file employees increased from 47,000 to 60,000, or 27 percent. Student enrollment increased from 433,000 to 466,000, or 7 percent.

In the last decade, the system saw two years of year-over-year declines in the number of full-time equivalent students.

Accepted students aren’t dropping everything and enrolling today; in 2010, 36 percent of those accepted enrolled; in 2014 that figure dropped to 27 percent.

With the continued flow of revenue, the system’s financial obligations have jumped 22 percent to over $5 billion from $4.1 billion in 2010.

And the budget? A 26 percent increase to a $8.7 billion budget from $6.9 billion in 2010.

Lottery revenue

The system also receives state lottery revenue: $42 million in 2014, up to $49 million this year. Cal State trustees have allocated part of that to the so-called Early Start program at the state Department of Developmental Services.

A portion of the lottery proceeds also goes toward the retirement fund for system employees. The system combined lottery and other funds to send $493 million to the pension system in 2014, up from $400 million in 2010.

And just last month, a new round of raises for executives was announced.

source: Tax filings

While families struggle to help students with tuition — and as student loan debt skyrockets — California universities continue to amass multimillion- and even billion-dollar endowments.

Endowments at the state university system schools have seen massive increases since 2009, even as in-state tuition at University of California has doubled in the last decade to $12,192 and the average student loan balance tops out in California at $20,340 per student as of 2013.

Most universities point to dwindling state support as justification for tuition hikes. But most also ignore, or fail to mention, the increases in their endowments, a considerable pot of money that for some colleges boosts their assets into the billions of dollars.

“We need to be forcing these institutions to spend more of that money in financial aid,” said José Luis Santos, vice president of higher education policy and practice at the Higher Education Trust, a Washington, D.C.-based group that advocates for better higher education opportunities for students.

The University of California at Berkeley’s nonprofit endowment arm reported a fund balance of $1.3 billion at the end of fiscal year 2013, the last year for which numbers are available.

That figure represents a 73 percent increase over the school’s endowment balance of $779.7 million in 2009. The fund supports “academic research for the students, employees and faculty of the University of California Berkeley,” according to the fund’s tax form 990.

The endowment for the University of California at San Diego grew 53 percent from $299.8 million in 2009 to $460 million in 2013.

At UCLA, the endowment balance increased 65 percent over the four-year period. UC San Francisco’s fund topped them all in terms of growth, ballooning 84 percent.

Over the same four-year period, UC in-state tuition increased 71 percent.

Endowments are used as investment resources, but the spending of the yield is dictated by fund policy, which can vary. Donors can, and often do, specify use as well, such as attracting professors with certain specialties or for particular research.

Santos disputes the claims of colleges who say they are hamstrung by contingencies and conditions on many endowment donations. They also contend that they cannot spend more than a specified percentage of their endowment, saving much of it for investment and future growth.

Even a small increase in spending can be significant, though, given the size of the endowment funds. The four schools CalWatchdog examined had a combined fund balance of $4 billion at the end of the 2013 fiscal year. One-tenth of one percent of that balance is enough money to cover full tuition for 329 students.

source: University of California

“Universities will tell you their hands are tied,” Santos said. “The question is, ‘Who sets these percentages?’ No one is governing these endowments other than themselves.”

Meanwhile, the salaries of administrators and top educators and researchers have skyrocketed, a fact that has not gone unnoticed by California lawmakers. Assembly Bill 837 would cap UC system salaries at the half-million-dollar mark.

From a legislative analysis of the bill introduced by Assemblyman Roger Hernández (D, West Covina):

According to the author, “the UC’s stance on increasing student tuition while at the same time continuing to pay its staff over half a million dollars is disturbing.

In 2013 calendar year, 387 employees made over $500,000 in total annual salary, with 29 others earning more than $1,000,000 per year.

In contrast, the remainder of the 268,442 UC employees earns an average annual wage of $43,520. According to AFSCME, the total UC spending increased by 40% during the 2007-2013 timeframe, while spending on UC’s richest employees increased  by 270% during the same timeframe.

When UC trustees voted 14-7 to increase tuition last fall, UC President Janet Napolitano said the rate hike was needed.

According to Napolitano, UC needs that 4% plus up to 5% more tuition each year for five years, or its equivalent from the state, to afford higher payroll and retirement costs, hire more faculty and enroll 5,000 more California undergraduates over five years. A third of the tuition money will go toward financial aid.

According to figures in a March bond issuance filing, the state has increased funding to UC by 31 percent since 2011-12, from more than $2.2 billion to more than $2.9 billion in the 2014-15 budget.

The new budget would increase the UC budget by 4 percent, contingent on no tuition increase.

UC is the state’s junior university system with 10 schools compared to California State University’s 23. But it has for years endured criticism for its generous payroll. Both systems are regulated in terms of payroll by the state assembly, which occasionally enlists measures to prevent outlandish pay.

The measures, though, have not always been successful. In the 2009-10 session, Gov. Arnold Schwarzenegger vetoed a measure that would have prevented executives in the UC system from getting a raise in years when the system’s budget was either kept the same or cut.

A measure last session would have required the California State University system to freeze undergraduate tuition and fees through 2016-17.  But according to the bill, which also inserted language to “request” the UC system do the same, the freeze was contingent on increases in state general fund support.

The bill died in committee.

Raven Rutledge is a student at San Francisco State University. She has not summered as a Wall Street intern. She is not enrolled in SFSU’s MBA program.

Yet, the environmental studies major played a lead role this summer in pressuring the San Francisco State Foundation — which manages the university’s $50 million investment portfolio — to disinvest in fossil fuels.

“I would like to know my school is putting its money in companies that are looking out for the best welfare of people,” Rutledge told the Los Angeles Times.

To her mind, that excludes corporations that produce the gasoline the vast majority of us use to fuel our motor vehicles, the coal used to generate most of the nation’s electricity, and the natural gas used to cool our homes in summer and heat them in winter.

She thinks such companies are on a moral par with such previous targets of divestment campaigns as South Africa’s apartheid regime during the 1980s and the combatants responsible for the slaughter of hundreds of thousands of innocents in Darfur during the 2000s.

The student activist has been indoctrinated by an outfit that calls itself 350.org – an allusion to the supposed safe level of carbon dioxide in the atmosphere, 350 parts per million. It demands that the 23-campus CSU and 10-campus UC systems rid themselves of their investments in the 200 companies with the world’s largest oil, natural gas and coal reserves.

Well, it was one thing for universities to sell off what little if any investments they had in South Africa or Sudan. It had next to no effect on the returns their portfolios earned.

But it is quite another thing for universities to allow their investment decisions to be influenced, unduly so, by student activists promoting some political cause or another. Indeed, by capitulating to young Miss Rutledge and her fellow global warming crusaders, the San Francisco State University board of directors very well may have violated its fiduciary responsibility.

Investments

Indeed, the foundation’s foremost responsibility is to maximize the return on its $50 million in investments, the proceeds of which are used, in part, to provide the scholarships and grants that help subsidize the expensive educations of Rutledge and her classmates.

CSU and UC schools that are considering following San Francisco State’s example have prima facie evidence of the deleterious consequences of politically-driven investment.

In 2002, the California State Teachers Retirement System divested its tobacco stocks at the urging of anti-smoking activists. In 2008, CalSTRS released a report lamenting that, had it held onto its tobacco stocks, it would have gained $1 billion.

The UC system had a similar experience. After selling off its tobacco-related investments, it lost $500 million in potential gains between 2001 and 2012.

That’s why student activists like Rutledge decided they would not attempt to get the UC’s $45.5 billion retirement system to divest its fossil fuel investments. They were afraid the system’s pensioners would revolt.

So, instead, they have decided to target UC’s $7.1 billion general endowment fund, urging the UC board of regents to vote this fall to jettison its investments in oil, natural gas and coal.

Taking their talking points from 350.org, the UC and CSU student activists maintain that fossil fuel stocks can be easily replaced by investments in “green” energy, including solar power, wind farms and biofuels.

But that’s just a fiction, as evidenced by the performance of the NASDAQ Clean Edge Green Energy Index Fund, which includes such stocks as First Solar, Hexcel and Teslas Motors. Since its market peak, the index fund has lost nearly 50 percent of its value.

That just goes to show why UC and CSU fund managers should not be taking investment advice from college undergrads who major in environmental studies, who know next to nothing about buying and selling equities.

By John Seiler

I feel sorry for today’s college kids, who run up tens of thousands of dollars of debt only to graduate into a slow jobs market.

Gov. Jerry Brown actually is advancing some decent ideas to help the kids:

“Brown hopes to use state purse strings to force down their expenses, hold the line on tuition and fees, and graduate more students more quickly.

“He wants more teaching, less research and more online courses to save money and increase offerings. He says more students should be accepted from California’s community colleges.

“The universities must ‘reconfigure themselves so that they are more effective and they’re able to do excellent work, but do it in a way that will not keep the costs escalating,’ said the governor, who attended UC Berkeley.”

Both the UC and Cal State systems now employ more administrators than professors.

And here we are, almost two decades into the widespread use of the Internet — much of which was created right here in our own California universities — yet schools don’t use it enough for teaching. Probably at least half of classes could be taught using such great tools as the Khan Academy and Udacity, with the university administering tests. Doing that, you probably could cut college costs in half.

Udacity

Brown is aware of this:

“Amid a push by Gov. Jerry Brown to expand online course offerings at public colleges and universities, San Jose State University and an online education startup Tuesday announced a deal to provide three entry-level courses for credit online.

“The pilot program, if successful, could eventually be expanded statewide, officials said. It is unusual because of the low price — $150 a course — and because it makes courses available to students who are not enrolled at the university.

“The deal with Palo Alto-based Udacity Inc. was announced after Brown approached Udacity founder Sebastian Thrun in June.”

We need more such innovation. Modern universities expanded greatly after World War II brought an influx of veterans on the G.I. Bill. Universities operated like the centralized factories of the day, with a gigantic “plant” (university buildings) that produced a “product” (diplomas) for a “market” (jobs in business and government).

But before then, universities were looser, less rigid arrangements. The Internet allows such a more humane system to come to the fore again.

Commentary

Nov. 5, 2012

By Bey-Ling Sha, Ph.D.

There comes a time in every parent’s life when she has to decide how much she is willing to sacrifice for the good of her children’s education. In our family, I have given up time, money, sleep and emotional tranquility to support the education not only of my own children, but also other children in California’s public schools.

Like many other parents, I began with basic school fundraisers to support various programs lost to budget cuts, such as art, music and field trips. Most recently, I have been promoting Proposition 38 as part of the California State PTA’s biggest fundraiser in history. Sponsored by attorney Molly Munger, Prop. 38 would raise $10 billion per year for the next 12 years and allocate those funds directly to schools, bypassing the black hole that is the California state general fund. I support Prop 38. wholeheartedly, without reservation.

The California State PTA is a major endorser of Prop. 38, but it has remained officially neutral on a competing tax-increase measure, Proposition 30, Gov. Jerry Brown’s initiative to raise taxes $6 billion a year. On Saturday, I resigned as the PTA’s Prop. 38 chairman in San Diego and Imperial counties. Now, I can speak as only myself, as a parent who cares about education funding in the long term, for at least the next 12 years, and not just the next 12 months.

In a word, Prop. 30 is dirty. It is a short-term, stop-gap measure that irreparably harms public education in California in the long term. As someone who hopes to live in California long enough to send her grandchildren to its public schools, I simply cannot support Prop. 30 at the ballot box, although I have come to this decision only after much, much reflection and soul searching.

California voters are being told that Prop. 30 must pass to prevent $6 billion in education trigger cuts this school year. That is true. But, it’s true only because the state Legislature and the governor have already taken those funds from education and used them for other stuff. Why? Because they figured that voters would raise taxes on themselves to fill a funding hole for education, but not necessarily for something else.

Next year?

But what about next school year? Prop. 30 essentially keeps K-12 education funding level, which means that we still would be 47th out of 50 states in per pupil funding. Regarding higher education, even Lt. Gov. Gavin Newsom has publicly said that Brown is misleading college students to believe that passage of Prop. 30 will prevent 2013-2014 tuition increases at campuses of California State University and the University of California systems. (It won’t.)

And what about the school year after that? Most voters don’t seem to realize that Prop. 30 is a constitutional amendment that permanently moves a portion of the state prison responsibilities (and its corresponding budget) down to the county level. This is called “realignment,” and it sounds great in theory. But, here is the dirty part: Realignment shrinks the state general fund. Oh, so what?

Well, education funding in California is determined each year as a percentage of the state general fund. Basic math tells us that X percent of a smaller number will be smaller than X percent of a bigger number. So, Prop. 30’s realignment provision, by shrinking the state general fund, actually reduces the funds for public education in the long term.

Californians should know better than most Americans that ballot-box wins today often are societal losses tomorrow. Exhibit A: Proposition 13, which froze state property taxes. Prop. 13 was a win for tax-averse voters in 1978, but it is one fundamental cause for the chronic state funding shortages today.

Will Prop. 30 be the Prop. 13 of this generation? That nightmare is what compels me to write this piece for public consideration, rather than merely in my personal journal.

Going public is scary. I teach at San Diego State University, which will see part of $250 million in trigger cuts if Prop. 30 fails. My university president and my faculty union are public supporters of Prop. 30. My children attend San Diego public schools whose teachers are promoting Prop. 30. Most of my personal friends and colleagues in the education community support Prop. 30.

But, I have decided that I am willing to sacrifice not only time, money, sleep and emotional tranquility in the interest of public education. I am also willing to sacrifice peace at the office, popularity on the playground, and privacy in my life to say what needs to be said: The children of California deserve better than Prop 30. And so do all Californians.

Bey-Ling Sha is the mother of a 7th grader and a 5th grader. She lives in San Diego.

Katy Grimes: Beware the student zombies at CSU Sacramento and CSU Sonoma. The California Faculty Association is sponsoring a flash mob today at the colleges, “with staff and students in costume, dancing to Michael Jackson’s ‘Thriller,’ with lyrics adapted to support Proposition 30.”

This is such responsible behavior from the faculty association, a group of adults supposedly who support college education.

“Faculty, staff and students at several CSU campuses have come up with a ghoulish way to promote the election on campus,” the Faculty Association website says.

“Faculty at East Bay, Sonoma and Sacramento will put a Halloween spin on their electoral efforts Wednesday as students and faculty – in full Halloween costumes – will perform spontaneous flashmobs for campus onlookers.”

Take a look at the California Faculty Association board, made up of a bunch of leftist Political Science, History and Anthropology professors. The protest today should be renamed Night of the Living Dead. 

“This just proves how self-focused and infantile the left is,” said Lance Izumi, Director of Education Studies at the Pacific Research Institute. “They love street theater.

“Who really thinks that these charades change anyone’s vote?” asked Izumi. “…only students and aging hippies.”

By John Hrabe

Congratulations or condolences?

It’s hard to say which is more appropriate for Timothy P. White, the newly appointed Chancellor of the California State University system. White takes over the top job at the country’s largest and perhaps most beleaguered public university system. Over recent years, Cal State has been fraught with controversies involving its executive compensation policies, state budget cuts and an endless series of tuition hikes.

In the press announcement of White’s hiring, CSU Board Chair Bob Linscheid said, “Tim White’s background and experience reflect the institutional values and mission of the CSU.” Institutional values? Linscheid should have just called the new chancellor a company man, who will do whatever it takes to protect and preserve the Cal State institution.

Now — more than ever — Cal State needs someone who isn’t a bureaucratic insider. The unimaginative educrats in the Cal State Chancellor’s office only see two options: increase revenue or cut spending. Since Cal State administrators aren’t about to give up their lucrative benefits, they’ve engaged in an unabashed and illegal campaign for Gov. Jerry Brown’s multi-billion dollar tax increase, Proposition 30.

“With slightly more than one month remaining until the November election, CSU campuses are hosting a variety of informational events detailing the impact of Proposition 30 on campuses and the university system as well as voter registration drives,” Cal State explained in a recent government-sponsored press release. “The 2012-13 California state budget includes a mid-year ‘trigger’ cut tied to Proposition 30 and if the measure is not approved by voters, the CSU budget will be cut by $250 million.”

The Howard Jarvis Taxpayers Association has fought back against Cal State’s blatant campaigning. HJTA president Jon Coupal told ABC News last month, “When they specifically reference Prop. 30 and the revenue that it would provide, then they’ve crossed the line.”

Coupal is right, but that doesn’t mean anyone should be surprised by Cal State’s actions. Cal State and its new chancellor are stuck in the old structure. In response to 2009 budget cuts, White told the Inland Valley Daily Bulletin, “The Regents action to raise fees was the ‘least lousy’ alternative in front of UC. Because the state is providing insufficient funding for UC, raising fees was the only choice left to help maintain the high quality programs Californians deserve and expect.”

Two years later, White’s response hadn’t changed much. “You’re not only cutting access. You’re also cutting out the seed corn of tomorrow’s innovations,” he told the San Bernardino County Sun as a part of an education summit to “drum up support for a special election and an extension of current tax rates.”

Earlier this year, then-UC Riverside Chancellor White told the New York Times, “I’d be lying if I said what we offer students hasn’t been changed and that there hasn’t been a degradation of the learning environment.”

Structural deficit

Even if Prop. 30 passes, it’s a temporary fix for Cal State. That’s because Cal State’s structural budget can’t cope with incremental institutional cost increases. Pensions, health care and energy costs are all up at Cal State. Meanwhile, state support of higher education, like every other budget item, is down.

To underscore this point, CalWatchDog.com has reviewed more than three decades of budget, enrollment and tuition data to evaluate the biggest claims in higher education. Cal State administrators say that state support of higher education is down. Taxpayer groups point to extravagant executive compensation for top administrators. Faculty members claim that their pay and benefits are static. Students complain that their tuition bills have skyrocketed. Parents argue that their tax dollars are funding more foreign and out-of-state students to boost revenue.

Who’s right? Everyone. And that’s exactly the problem. The institution is broken.

State Legislators Have Approved Record Budget Cuts to Cal State

In the past decade, there has been a fundamental shift in how taxpayers and students split the bill for a Cal State education. In 2000-01, the state spent more than $2.47 billion in general fund expenditures on the Cal State system, while student fees accounted for $482 million dollars of the overall budget. In 2012, the state’s general fund contribution fell to $2.01 billion, and student fees have risen to $1.593 billion— a 230 percent increase in a little more than a decade.

In 1999-2000, the average full-time equivalent Cal State student paid just 20.3 percent of the cost of his education. Nearly three-quarters of the bill was paid by state taxpayers, with the remaining 5.6 percent picked up by other sources.  In 2010-11, the average full-time equivalent Cal State student paid 37 percent of his total education costs. The state’s portion fell to 55 percent.

According to a January 2012 report by the state’s independent Legislative Analyst’s Office, “recent tuition increases and state funding cuts” could raise the Cal State students’ share to 46 percent. However, the LAO also points out, “Because they do not account for facilities costs, these figures actually over-state the share students pay. Facilities costs, which are difficult to calculate, can add roughly 20 percent to the annual cost of education.”

Who should pay what? There’s plenty of room to debate how the bill should be split. But, it’s clear that the financial burden has changed dramatically in the past decade.

Cal State Tuition Has Skyrocketed

Following with the shift in overall state budget funding, tuition has skyrocketed for Cal State students. In less than eight years, tuition has risen 150 percent, from $2,334 per year in 2004 to just under $6,000 this fall. In just the past two years, the cost of attendance for a Cal State student living off campus has increased by $2,602 — from $23,712 to $26,314.  Tuition represents 83 percent of these increased education costs.

According to the LAO, not all students pay these higher tuition bills.  “Nearly half of all undergraduates at California’s public colleges and universities receive grants or waivers that fully cover education fees,” the LAO explained in a report titled, “Higher Education: Answers to Frequently Asked Questions.”

Don’t forget that student tuition and fees are tax-deductible thanks to the American Opportunity Tax Credit, which is worth up to $2,500 per year in federal tax credits per student. Again, the LAO says that tax credit helps “39 percent of CSU families (who) received about $270 million from this credit in 2009, averaging close to $2,000 per student.”

Cal State President and Top Administrators Have Enjoyed Lavish Perks and High Salaries

CalWatchDog.com has provided extensive coverage of Cal State’s excessive presidential pay and benefits. The average base salary of the state’s 23 college presidents is just under $300,000 per year, a figure that does not include other widely reported benefits such as a car allowance, bonuses paid by tax-exempt college foundations and free housing.  Cal State presidents receive perks and benefits worth as much as 50 percent of their base salaries, or more than $145,000 per year.

According to an analysis of payroll data by the California Faculty Association, Cal State presidents awarded 486 pay raises to top managers from 2008-10. Cal State Chancellor Charles Reed handed out another 80 pay raises to his chosen bureaucratic elite.  Those figures excluded promotions for staff that have internally changed positions. “On an annualized basis, these discretionary raises added $6.5 million to the cost to run the CSU system,” the study concluded.

Foreign and Out-of-State Students Fill More Slots at Cal State Universities

In 1975, Cal State admitted 391 foreign students and 1,698 out-of-state residents. Combined, foreign and out-of-state students made up less than 1 percent of the entire student body. Last year, Cal State accepted 11,489 foreign students and 4,053 out-of-state residents, which combined to account for 3.6 percent of the student body.

The increase in the number of foreign students — from 391 to 11,489 — is a bit of a statistical exaggeration. In the early 1980s, foreign students represented roughly 3 percent of the student body, peaking in 1981 with 10,231 foreign students.

Regardless of which year you pick as the starting point, it is true that foreign and out-of-state residents account for a bigger portion of the student body. Since 1975, the average combined percentage of foreign and out-of-state students has been 2.94 percent.  In 2011, these groups accounted for 3.6 percent of the student body.

Increased Institutional Costs: Faculty Health Premiums Have Increased

The California Faculty Association, which represents 23,000 employees on the 23 campuses, recently ratified a new contract agreement. Employees didn’t receive pay raises, but they did preserve their health benefits. Many state agencies pay 80 percent of employee health plan premium costs. Cal State is a bit more generous and pays 95 percent of the bill.

Health care isn’t getting any cheaper. In 2011-12, Cal State spent an additional $36.4 million in health care premium increases. According to the Cal State budget analysis, “The total increase in CSU health care costs due to contribution changes during this five-year period is nearly $104.4 million.” And that money was to maintain the status quo. Employees didn’t get better health coverage or see their premiums decrease. Over the last five years, it’s cost more than $100 million more to keep things exactly as they are.

By Ariel Carmona Jr.

In recent years the California State University system has worked to jump-start many incoming freshmen through the controversial Early Start Program. But in the wake of the ESP, a number of educators across all CSU’s 23 campuses have expressed concerns over the restructuring of student remedial programs in the cash-strapped CSU system.

Thus far, the CSU Board of Trustees is steadfast in its implementation of the program, despite opposition and lingering questions about funding and about the impact it might have on low-income and disadvantaged students.

An ad hoc group calling itself the Access and Equity Workgroup, composed of more than 200 CSU faculty and staff representing all the campuses, addressed the CSU board of trustees earlier this year at the board’s headquarters in Long Beach.

The Early Start Program was enacted by outgoing CSU Chancellor Charles Reed via Executive Order 1048 in June 2010. The ESP creates a new 2012 mandate for CSU freshmen who have been given regular admission, but lack college-level proficiency in mathematics, English, or both.

Under the ESP, incoming freshmen needing assistance in math and/or English are required to enroll in remedial classes prior to the term they have been admitted — summer prior to fall. If students needing remediation do not participate in the program, with some exemptions, they will not be permitted to enroll at a CSU campus, barring extenuating circumstances.

“The goal is to help students not only complete remediation, but to be successful in all their courses. Fewer students who need to repeat courses because they have developed strong competencies will result in less cost to the system,” said CSU spokesperson Michael Uhlenkamp.

According to information made public by CSU, system-wide the bulk of entering first-time freshmen (60 percent) needed remedial courses. While at some CSU campuses, more than 75 percent needed remediation. The California Faculty Association reported that, in 2009, the level reached 93 percent at one campus, Dominguez Hills.

CSU Faculty and staff concerns about the ESP

Educators have said the ESP will disproportionally impact low-income students and students of color, many of whom must work during the summer to support their families and pay for their education costs.

CSU data of regularly admitted first-time CSU freshmen needing remediation in math and/or English reveal several things. Despite being academically CSU-eligible and in the top third of their high school class with an average GPA above 3.0, these students tend to come from high school districts with higher numbers of African-American and Latino students, greater poverty and fewer credentialed teachers. A greater number are English-language learners.

“Potentially students between high school and university education could have a job, could have family obligations and they could want to have a school-free summer before they start the very demanding project of going to college,” said Dorothy Wills, California Faculty Association president at Cal Poly Pomona. “Obviously there are an awful lot of entering students who do need remediation. So I guess the idea behind the executive order for Early Start was to beef it up even more to take some of the pressure off the English and Math departments. But offering the programs in summer and making them mandatory is perceived by most of us as being discriminatory.”

Cal Poly Pomona Associate Provost Claudia Pinter-Lucke refutes the assertion that participation in the program would be a hardship to students. “I would say that’s probably the weakest argument against Early Start,” she said, “The students can go to whatever campus they live closest to, so they don’t have the expense of long drives or airplane flights. A number of classes are offered online so students can do it from their homes, or they can do it after work if they need to work to raise funds for their expenses during the school year.”

Pinter-Lucke said there’s financial aid being offered by the chancellor’s office, which pays all fees associated with the program. In addition, each of the campuses has additional financial aid for which students can apply. Cal Poly has set up 1.5 unit classes designed to get students used to college expectations. “The whole point of these 1 unit classes was to give students a lower cost option than the full three semester unit or four unit quarter courses.”

Where is the funding coming from for Early Start Programs?

CSU confirmed the funding for Early Start is coming from the same funds already in place at each campus used to support all remedial programs. But neither Cal Poly Pomona nor Cal State Los Angeles administrators responded to questions regarding how much funding is already in place at each institution for remediation. Pinter-Lucke said virtually all work for the program is being done by current Cal Poly Pomona employees as part of their existing job duties and as part of the academic affairs department budget. So there has been no increase in expenses for the program.

“We’ve had it in our budget for seven years, so it really is a line item for us,” said Pinter-Lucke, adding that the only change has been that CSU has now made it a mandatory program.

The cost of the program to students is $182 per unit and it does not fluctuate at each campus. CSU does not agree with the contention that mandatory ESP classes place an financial burden on minority or low-income students, because financial aid is available to qualified students. Fee waivers are available to those who qualify for the entire cost of the program.

However, Uhlenkamp confirmed that some of the lottery funding given to CSU by the state is being diverted to provide financial aid for the ESP. And since lottery funds are state funds, that makes AB 540 students ineligible for the financial aid waiver to cover the program this summer. According to information made public on their website, CSU states that, as laws change in early 2013, AB 540 students may become eligible for ESP fee waivers, providing a mechanism is developed to estimate family support. “Overall, Early Start is largely expense-neutral in so far as students will finish their remediation requirements earlier.”

If it ain’t broke…

“There were several prototype programs throughout CSU before Early Start was adopted by all the campuses,” said Uhlenkamp. “As these programs were complementary, most of them continue side by side with Early Start.”

Pinter-Lucke said the number of admitted freshmen who needed remediation at Cal Poly Pomona had gone down from fall 2005 to fall 2010 (from 56 percent to 42 percent). And last fall, 93 percent gained full proficiency before their second year, versus 86 percent system wide. “I would think that is in part because of the emphasis we put on remediation in Early Start from the beginning,” Pinter-Lucke said. “You can see that they [CSU] felt that something needed to be done to improve the number of students who remediate after a year in college.”

“We have something like an 80 percent rate for those students to proceed into their academic programs and eventually graduate, so remediation when they take it on our campuses is effective,”  said Wills. She added she does not understand why the Board of Trustees has gone ahead with Early Start, considering existing programs such as the Bridge Program and the Educational Opportunity Program are already in place.

“These are very good programs, and they perform the service of orienting students to university life, which is very important to these students,” Wills said. “The ones who are in the remedial classes and the ones who come for Bridge tend to be lower income students. Not at Cal Poly so much, but Dominguez Hills, East Bay. Not the more elite institutions. So does the ESP compete with EOP programs? In terms of student attention, student time and scheduling, if it does, that’s not a very good thing, because it further harms students who are already disadvantaged, educationally speaking. The motivation for it really escapes me.

“The CFA [California Faculty Association] does not approve of this program. Insufficient consultation was done. There seems to be a compelling motivation for handling it the way they are handling it. In the case of our campus, with the 1.5 credits it seems like a useless exercise in a very undemocratic handling of students, compelling them to take a little course. How is that going to help anybody? They are not going to be college ready after one unit of instruction.”

Hurdles

“There are always hurdles to overcome and adjustments with any new initiative,” said Uhlenkamp in response to assertions that the ESP will require substantial resources for design, implementation, and sustainability; and that it places differential burdens on individual campuses. “It is still early, but initial feedback from the rollout of Early Start points to the initiative being quite successful,” he said. Uhlenkamp adds evidence that programs such as the ESP are effective will be forthcoming when data from the system’s first experience is fully analyzed.

In terms of funding, the CSU was unable to provide overall figures of the system wide cost of implementing the program. “We don’t know, we’re still tallying the figures,” said Uhlenkamp, who added final results would mostly likely become available in November. He said CSU has allocated the same amount of funding the system would normally earmark toward remediation programs, but did not provide data what that amount might be. “The idea is, you don’t need to run as much remediation during the year because you’re starting in the summer.”

Others are not convinced of the program’s effectiveness. Nor do they approve of the way it has been implemented. The CSU English Council, comprised of members throughout all the CSU campuses, put out a position statement in opposition to the ESP in 2010 and again in fall 2011. It partly reads, “No valid evidence has been presented to us that Early Start is effective, and we do not feel students should be forced to enroll in programs whose educational value is unproven.” It goes on to cite a number of reasons why the council feels the program is both punitive and unnecessary.

Paul Browning, spokesperson with the Public Affairs Office at Cal State Los Angeles, said via e-mail that criticisms about the program are a bit premature. “I don’t believe anyone here at CSULA has formed opinions about these objections as of yet. At this point, we are just offering, running and monitoring the program,” he said.

However, Kimberly King, a psychology professor at Cal State L.A. and member of the Early Start Task Force, has been vocal in her opposition to the program. King went on Southern California public radio station KPCC in 2010 to express her views on the mandate, saying requirements which sounded easy to fill actually would not be. “We already have data based on our research that students from low-income backgrounds, and in particular African-American students, have a higher rate of incomplete applications,” King said at the time.

Since then, so far a total of eight resolutions against the mandatory program have been enacted by faculty, including by its English Council and campuses at Dominguez Hills, Los Angeles, Sacramento and San Luis Obispo. More such resolutions could be circulated in the near future.

Class staffing

One concern is the staffing of the classes. While professors are not required to be members of the faculty union to teach at the CSU level, Wills also cited concerns over the quality of instruction. “One version of how they were going to staff this had to do with brining community college teachers into the picture, which was obviously a problem with our faculty if it were supplanting them in the classroom,” Wills said. “We want university faculty to teach university students. Nothing against community college teachers, a lot of them teach as lecturers anyway. But we wanted to have something to say about who got hired to teach.”

Educators at various campuses said they wondered why counselors were not included in the system wide implementation of the program. “I don’t know if that’s the case, I don’t know who participated in all the conversations all the way through,” said Uhlenkamp.

In terms of staffing, Uhlenkamp said the hiring of teachers is all handled at the campus and departmental level and that in most cases it depends on the availability of faculty during summer at each individual campus.

Wills added that there remain lingering questions regarding instruction. “As the budget for remedial classes swells, it takes away from the instructional budget for more advanced instruction and more advanced courses,” Wills said. “So that those two departments, English and Math, are going to see a loss of lots of sections of Calculus and other advanced sections in math and a loss of sections in the English major. We need to divert more of the general fund to instruction and take it out of some of these shenanigans that the administration gets up to.”