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California State University, Long BeachCalifornia State University, Long Beach
CALIFORNIA STATE UNIVERSITY, LONG BEACH
TO:Jane Conoley, President
FROM: David Dowell, Provost and Senior Vice President for Academic Affairs
Mary Stephens, Vice President for Administration and Finance
Co-chairs, 2015-16 Resource Planning Process (RPP) Task Force
DATE: October 23, 2015
SUBJECT:

2015-16 RPP Task Force Budget Recommendations (Addendum)

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This memo transmits the final budget recommendations of the 2015-16 Resource Planning Process (RPP) Task Force. The original 2015-16 RPP Task Force Report issued in June 2015 was based on state budget information and Chancellor’s Office campus budget allocations at that time. The final state budget enacted by the governor over the summer contained additional funding for the CSU that also meant additional budget allocations for CSULB. This memo addresses these campus funding changes and resultant budget recommendations.

Summary of June RPP Task Force Report

  • The June RPP Task Force report was based primarily on the Governor’s May Revise budget proposal for a $157.5 million CSU funding increase.
  • The chancellor allocated $64 million of the proposed $157.5 million from the governor’s budget proposal to the campuses. A total of $16 million was allocated for enrollment growth, $16 million for mandatory cost increases (healthcare and new space), and $32 million for 2 percent compensation increases for all employees except faculty.
  • The chancellor held the balance of $93.5 million until further notice. This amount was expected to fund faculty compensation increases (pending collective bargaining), student success and completion initiatives, additional enrollment, and the financing of physical plant maintenance and infrastructure.
  • CSULB’s estimated share of the funds allocated by the chancellor was approximately $600,000. In addition, we estimated that campus revenues would increase by about $1.5 million due to resident enrollment growth and an increase in non-resident enrollment.
  • RPP recommended supporting the increased instructional costs for the allocated enrollment increase by allocating almost $1.2 million for instruction.
  • RPP also recommended allocating $800,000 for current year compensation increase shortfalls, a salary set-aside for the Chief Information Officer, risk pool premium increases, and State University Grant adjustments.
  • In order to respond to the Chancellor’s directive that campuses implement their own salary equity adjustments for faculty and staff, CSULB identified permanent funds totaling $1 million from the campus-wide utilities budget to fund equity adjustments. RPP recommended allocating $960,000 to process faculty equity adjustments effective January 1, 2015 and $250,000 to process staff equity adjustments effective July 1, 2015 (both including benefit cost increases).
  • The recommended allocations exhausted the available new resources and the repurposed utility savings and in fact created a $84,446 deficit, but this deficit was considered manageable.

Final State Budget

The final state budget for 2015-16 enacted by the governor included $217 million in additional funding for the CSU, $60 million more than in the May Revise budget. Given this positive change in funding to the CSU, the Chancellor’s Office also revised campus budget allocations. In addition, after analyzing 2014-15 actual enrollment demographics and related fee revenues, we were able to revise revenue projections for 2015-16.

  • The chancellor allocated $126 million of the proposed $217 million from the governor’s final budget to the campuses, $62 million more than previously allocated. Of the $62 million increase, $42 million was allocated for enrollment growth, and $20 million was allocated for student success and completion initiatives.
  • The chancellor continues to hold the balance of $91 million until further notice. This amount is expected to fund faculty compensation increases (pending collective bargaining), financing of physical plant maintenance and infrastructure, initiatives to encourage campuses to attain certain performance measures and other systemwide initiatives.
  • CSULB’s budget allocation by the chancellor increased $4,237,000. The majority of this increase is attributable to enrollment growth funding of $2,291,000, student success initiatives of $1,021,000, and a retirement rate adjustment of $542,000. In addition, we estimated that campus revenues will increase by an additional $3,729,000 due to resident enrollment growth and an increase in non-resident enrollment. Together, CSULB’s sources of funds have increased $7,966,000 since the June RPP Task Force Report.

Recommendations of the Resource Planning Task Force

The budget recommendations of the RPP Task Force can be broken into two categories: changes to line items previously identified and described in the June RPP Report; new line items since the June RPP Report.

  • RPP recommends that dollar amount changes to line items previously identified and described be allocated as prescribed. These dollar amount changes total $4,042,091. The largest change is to enrollment increase instructional costs due to enrollment growth ($2,410,138), PERS retirement rate change ($542,000), State University Grant adjustments ($415,000), and risk pool premium increases ($319,507). The remaining smaller changes are for additional staffing and operating costs needed to operationalize the Chief Information Officer function ($100,000), campus compensation equity adjustments ($171,000), and an adjustment for the deficit from the June RPP plan ($84,446).
  • RPP recommends that the following new line items totaling $2,618,300 since the June RPP Report also be allocated as prescribed:
    • A total of $1,387,300 for student success and completion ($1,221,000), assigned time per CFA agreement ($148,800), and E-Advising base budget costs ($17,500).
    • A $750,000 increase of the university benefits pool. This is required due to the increased faculty and staff hiring that has been and continues to occur since enrollments have increased and budgets have improved.
    • A $231,000 increase for staffing requirements related to Title IX compliance, Disabled Student Services, and Counseling and Psychological Services. The increased staffing is necessitated by changes in federal/state law and changes in student population and needs.
    • A $250,000 estimate to address faculty salary inversion issues.
  • The sum of the two categories above is $6,660,391. This represents the total additional budget requirements that have been identified since the June RPP Report. When these additional requirements are funded by the additional resources of $7,966,000, a surplus amount of $1,305,609 remains.
  • RPP recommends that this surplus of $1,305,609 be set aside for another round of faculty and staff compensation equity adjustments.

The table below summarizes all the budget changes described above. The changes are categorized in an attempt to provide further context and rationale for the many changes that have occurred since the June RPP Report.

Changes Since June 2015 RPP Plan

Sources:

Additional allocation from CSU $ 4,237,000
Aditional CSULB revenues $ 3,729,000
Total Additional Sources $ 7,966,000

Uses:

Line item in CO budget $ (4,907,645)
Student success and completion $ (1,221,000)
PERS retirement rate change $ (542,000)
Risk pool premium increase $ (319,507)
State University Grant $ (415,000)
Enrollment increase instructional cost $ (2,410,138)
Addresses unavoidable cost already incurred $ (250,746)
Offset deficit from May 2015 plan $ (84,446)
Assigned time per R03 $ (148,800)
E-Advising base budget $ (17,500)
Addresses unavoidable cost in future $ (750,000)
Increase university benefis pool $ (750,000)
Addresses need created by changes in Federal law and Chancellor's Office regulation $ (75,000)
Title IX $ (75,000)
Addresses need created by changing student population $ (156,000)
Disabled Student Services $ (76,000)
Counseling position $ (80,000)
Presidential direction $ (521,000)
2015-16 campus faculty equity adjust. $ (121,000)
2015-16 campus staff equity adjust. $ (50,000)
Faculty salary inversion adjust. $ (250,000)
Chief Information Officer costs $ (100,000)
Total Additional Uses $ (6,660,391)
Set-aside for faculty/staff compensation equity adjustments $ (1,305,609)
Revised Surplus / ( Deficit ) $ -

Concluding Thoughts

A controversial issue was the lack of funding for staff hiring. With the exception of a few hires related to Title IX and counseling, the proposed budget does not support additional staff hiring. With increasing enrollment, many offices on campus from academic departments to Enrollment Services to Financial Management and more have very high workloads and some staff hiring is very justifiable. The RPP Task Force, however, was interested in using what funds are available for compensation for current employees rather than additional staff.

The proposal for a Chief Information Officer (CIO) generated questions among the RPP Task Force. It is important to note that the Task Force was not unanimous in its support for the additional funding proposed for the CIO line item, and, in fact, there was some vocal opposition. A number of Task Force members expressed the opinion that hiring a CIO should result in reduced costs, not additional costs. However, the co-chairs were not alone in believing that technology will drive changes in service delivery and in pedagogy at an increasing rate. The current campus situation is one of non-integrated major information systems, inconsistent technology standards, and limited support for mobile computing. The campus needs to bring increased vision and integration to our major technology enterprises to support key future needs. First, the academic division has built an infrastructure for digital teaching and learning that will require support from the campus infrastructure. Second, the campus needs to integrate the HR, Finance, and Student PeopleSoft systems to create a business intelligence data warehouse and dashboards. Third, we need to develop robust infrastructure to support mobile computing, as this is the clear direction of much technology. Fourth, a CIO needs to manage the soon-to-be developed server and storage services to ensure security and reduce duplication. Finally, some auxiliary systems need to be integrated into the campus infrastructure. Accomplishing these complex objectives will likely require a greater investment in IT-related staff and operating costs.

The original proposal was to add $300,000 to the June recommendation of $200,000 for a total of $500,000 set-aside for the Chief Information Officer function. The $500,000 would be set aside for the salaries and benefits cost for the CIO position, other required staffing, and operating costs needed to operationalize this new function. However, in view of the lengthy discussion and debate about the merits of setting aside a total of $500,000, the co-chairs have decided to recommend a lesser amount. The proposal has been reduced to add $100,000 to the June recommendation of $200,000 for a total of $300,000 set-aside for the CIO function. This revision most likely only delays a future commitment that will be needed to support the campus information technology infrastructure.

The Task Force would like to acknowledge the continued hard work and resolve shown by the entire university community. CSULB remains a vital, premiere institution of higher education. This would not be possible without the energy, creativity, dedication and positive attitude of our faculty, staff and students.
C:
  • Associated Students Officers
    All CSULB Employees

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