CFA GOVERNMENTAL RELATIONS OFFICE – SPECIAL REPORT
“GOVERNOR'S MAY REVISE BUDGET PRESERVES STUDENT ACCESS – FOR NOW”
May 15, 2002

GOVERNOR'S MAY REVISE BUDGET PRESERVES STUDENT ACCESS – FOR NOW

Governor Gray Davis released his revised budget plan yesterday, telling
reporters he was forced to use every tool at his disposal to address a
budget shortfall now projected at $23.6 billion – a substantial increase in
the $12.5 billion estimated state deficit at the beginning of the year.

To cover the deficit, Governor Davis proposed $8 billion in cuts, primarily
to Medi-Cal and welfare-eligible recipients. Additionally, Governor Davis
proposed increasing the Vehicle License Fee to its 1998 levels and providing
a surcharge on cigarettes. The revised budget assumes a one billion
reimbursement by the federal government for "anti-terrorism" measures, and
$400 million in federal reimbursements of state Medicare costs. Davis has
also proposed borrowing hundreds of millions of dollars to compensate for
the bulk of the budget shortfall.

Under the revised spending plan - known as the “May Revise” - which is based
on the state's actual revenues, the CSU would receive $50.4 million less
than the allocation proposed in the Governor's January 2002-03 budget plan,
which provided the CSU with a net general fund increase of $28.1 million.
Taken together, the result is a net reduction of $22.3 million to the CSU
budget.

The May Revise proposes a mix of spending increases and targeted spending
cuts for the CSU. The cuts include $70 million in spending reductions,
including $43 million in cutbacks designated for information technology,
instructional equipment, library materials, and deferred maintenance (the
amount of reductions in each category would be decided by the CSU, and these
reductions could not be absorbed by other non-designated categories,
according to the state Department of Finance). However, Governor Davis
provides a partial offset to this reduction by allocating an additional
$19.5 million to fully fund the enrollment growth of 3,008 new full-time
equivalent students (FTES). This brings the total 2002-03 enrollment growth
allocation to $98.8 million (15,278 FTES).

CFA is proposing budget language to protect CSU instructional and student
service programs from the budget cuts, and directing the CSU administration
to adhere to minimum levels of funding educational and student support
needs.

The legislative budget subcommittees are expected to complete their
deliberations by the end of next week, and a joint budget conference
committee with Senate and Assembly representatives will convene shortly
after. The legislature is required to complete its budget work by June 15,
but the deadline has seldom been adhered to.

Please forward any budget related documents that might be of interest to
CFA's budget campaign – especially documents that outline campus budget
reductions – to Andrew Lyons at <alyons@calfac.org> or David Hawkins at
<dhawkins@calfac.org>. Or phone the CFA-GRO office at (916) 441-4848.