CFA GOVERNMENTAL RELATIONS OFFICE SPECIAL REPORT
2003-04 CALIFORNIA BUDGET

January 10, 2003



GOVERNOR RELEASES 2003-04 BUDGET

Governor Gray Davis released his 2003-04 budget proposal today in response
to an anticipated $34.6 billion budget shortfall by the end of next year -
nearly 45 percent of the entire state budget.  Davis proposed that over half
the budget deficit be addressed with budget cuts and savings, including a
$326 million cut to the CSU budget.  The Governor's proposal represents a 12
percent cut to the CSU's 2002-03 general fund ($2.68 billion).

Governor Davis has proposed the following 2003-04 budget reductions for the
CSU:

Unallocated base budget reduction                       $142.8 million
Reduction in student service funding                    $ 53.2 million
Reduction in academic and institutional support         $ 58.1 million
Reduction in outreach funding                           $ 12.6 million
Reduction in CalTeach funding                           $  2.0 million
Reduction in Bilingual Teacher Recruitment              $  2.0 million
Increase student-to faculty ratio from 18.9 to 19.9     $ 53.4 million
Reduction in Student Fellow Program                     $  0.5 million

The Governor maintained his commitment to student access by providing $150.9
million to fund 16,000 additional full-time equivalent students (FTES) in
2003-04 and backfill for 8,000 unfunded FTES in 2002-03.

The 2003-04 budget also assumes a 25 percent increase in undergraduate fees,
and a 20 percent increase in graduate fees. These would be in addition to
the 10 percent undergraduate and 15 percent graduate fee increases approved
last month by the CSU Board of Trustees.

Budget hearings are beginning next week to address the $10.2 billion that
Governor Davis has proposed to cut in the current year, which includes the
$59.6 million reduction to the CSU. CFA is working with the Governor's
office and legislative leadership to protect instruction and student service
programs from these cuts.

CFA issued a press release calling on the CSU administration to become a
stronger advocate for students by defending student access and protecting
the CSU's instructional mission.  The press release appears below.

CFA is working to reduce the overall magnitude of the 2003-04 budget
reductions and ensure that instruction programs are protected.  CFA will
provide further analysis of the 2003-04 budget next week.

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FOR IMMEDIATE RELEASE
January 10, 2003


FACULTY PREDICT DIRE CONSEQUENCES FOR CSU IF PROPOSED BUDGET CUTS ARE
IMPLEMENTED

SACRAMENTO - The union that represents the faculty who teach in the 23
California State Universities predict dire consequences for higher education
if the cuts in Gov. Davis' proposed 2003-04 budget are implemented.

The California Faculty Association went on to call on the CSU Trustees and
Chancellor Charles Reed to join with the faculty union in a campaign to
persuade the Governor and the legislature to preserve  one of the finest
systems of higher education in the world.

Susan Meisenhelder, CFA President, said "We realize that budget cuts are
necessary given the state's fiscal problems.  But there is no way the CSU
system can withstand a $326 million cut in one year without compromising
students' access to higher education and the quality of education that
students receive."

The $326 million total in proposed cuts, about 12 percent of the CSU's base
budget, include $53 million to raise the ratio of students to teachers.
Increasing this ratio will be unbearable for students who will who will be
hard-pressed to get individual attention from teachers in overcrowded
classrooms and difficulty getting the classes they need to graduate. The
proposed cuts also include $143 million left to the CSU administration's
discretion, and the elimination of some outreach activities, student
services, and teacher education programs.

CFA noted favorably that the governor's proposal includes funding for the
current over-enrollment of 8,000 students and to expand enrollment for
16,000 more, which is appropriate during a downturn in which many people are
out of work and seek more education.

Lil Taiz, Vice President of CFA said, "The problem is that we are already
crowded. If we reduce the number of classes and teachers, students will be
jammed into classrooms like sardines, unable to get a teacher's attention,
and it will be harder for them to finish degrees. That would be a disaster
for our students and bad for the long-term health of our state."

She added, "The CSU educates most of our K-12 teachers, our nurses, our
local and state government leaders, our engineers, our artists and our
businesspeople. We need these people to be well-prepared and out there
serving our state and contributing to the economy."


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