San Francisco State University

President Corrigan's ViewPoint

ViewPoint by President Corrigan is published in First Monday for the faculty and staff at SFSU on the first Monday of the month during the fall and spring semesters by the Public Affairs and Publications offices. EXT 8-1665. pubcom@sfsu.edu


November 6, 2000

At my recent monthly breakfast with the Academic Senate Executive Committee, I learned that across campus there may be considerable concern - even alarm - about the state of the University's budget. The closure of the residence apartment building and the failure of the Village at Centennial Square to open on time, together with more recent news of disappointing fall enrollment figures, may have fueled fears of mid-year budget cutbacks.

Let me assure you that no such danger exists. The picture, while not all that we would wish, is not dire. I think it is important that you have a realistic view of the campus' finances, and that starts with a status report on each of these three issues that have given rise to the budget anxiety. So here is where we are.

The Village is not a drain of any significance on University resources. This project, as you know, is being undertaken by the SFSU Foundation, which means that general fund monies are not the source of funding - nor is our general fund budget drawn down by the loss of rental revenue. As part of our effort over the years to provide alternative housing for students, we have incurred some costs from the University budget -Treasure Island and Presidio shuttle buses, for instance - but the campus is not going to experience a negative impact from these expenditures.

Furthermore, as with all major construction projects, this one includes contractual provisions that provide for penalties and cost recovery if the contractor has not met the completion deadline. We are optimistic that we will be successful in resolving the legal dispute in a manner that will leave both the Foundation and the University free of financial loss due to this project.

Unlike the Village, however, the residence apartment building (RAB) is a University budget matter. When we closed the building, we were concerned not only about loss of rental revenue but about our continuing obligation to meet the bond payments and some related CSU system charges - some $2.2 million annually. However, I am pleased to report that the Chancellor's Office has agreed to assume responsibility for these payments, at least for this year. They will review that decision annually, but we are assured of the money for 2000Ð01, and believe we can count on it in future years as well. We are in litigation with the RAB's builder, and we fully expect that eventually we will be reimbursed for our losses, including loss of student revenue.

Enrollment is the area with the greatest potential to do serious harm to our budget. However, it is also the area in which we have the greatest power to eliminate the problem. It is clear that enrollment has to be a campus-wide responsibility and concern - not just a matter for the Enrollment Management staff.

But while we are facing real enrollment issues, we are getting something of a budgetary reprieve this year. The enrollment facts are these: We had anticipated, and were budgeted for, an increase over last year. However, like several of our fellow Northern California CSU campuses, we have an enrollment problem. Our FTE is some 1,200 below target - about 5 percent - a shortfall that pushes us into the possible payback zone. (The CSU allows campuses up to 2 percent leeway, but when enrollment declines past that point, the campus can be subject to a mid-year reduction.) Such a reduction, which could amount to several million dollars, would have a significant impact on our budget.

Once again, however, we have received an understanding and supportive response from the Chancellor and his staff. We made the case that much of our failure to meet the target was beyond our control, particularly our loss of 1,430 student beds, which hit hard at a point when we were seeing more first-time freshmen and Southern California interest in the University. Accordingly, the Chancellor's Office has agreed not to penalize us with a mid-year reduction. However, we have an obligation to see that next year's enrollment reaches at least this year's target. If it does not, we are vulnerable to a significant budget cut.

We need to ensure that that does not happen. And a critical period is at hand: building the schedule for the Summer Semester. Summer Semester may be the key to maintaining our budgetary support because it holds great promise for enrollment growth. Last summer, we achieved 800 FTES through CEL. For summer 2001, we are considering that number a base, converting it to general fund FTES in a fully state-supported Summer Semester. We believe we can build by another 600-800 FTES. To do so, we need a strong summer schedule that responds to student needs. Departments will be funded to offer these courses, and we are depending on widespread cooperation and support from deans, department chairs and faculty. A state-supported Summer Semester has become vital to our future well being, and all academic areas have a stake in it.

With an enlarged Summer Semester, and with even a modest increase during the academic year, we anticipate that we can recover and meet an increased target. We have not at this point determined what that target should be.

Although, thanks to Chancellor Reed and his staff, we have not had to absorb potentially devastating losses from housing and the enrollment shortfall, we have made one significant budget adjustment this year: In order to stretch our dollars and be able to maintain momentum in various campus initiatives, including the appointment of new tenure-track faculty, we eliminated one budget category - the University emergency fund - and devoted that $1 million-plus to other uses. But a University must have emergency funds - the unexpected always arises during the year - and to meet emergency needs, we established a salary savings program for staff and administrative - but not for faculty - positions. The monies we gather centrally between the time when a position falls vacant and when it is refilled, or when it is filled at a lower salary, are allowing us to rebuild an emergency reserve.

I am pleased to report on one piece of good news. We are closing the gap in FTE support that has plagued this campus for more than 30 years. At one time, we calculated that had we been funded at the level of San Diego State, we would have received an additional $23 million annually. We are closing in. For 1999-2000, our dollar support per actual FTE - $9,047 - compared pretty well with San Diego State's $9,302, and that $23-million gap shrunk to $5.16 million. I believe that we will see the continuation of this positive pattern.

So as we take stock of our 2000-01 budget, we can say that while we are certainly not flush, we are far more fortunate than we might have been. Now, through a shared effort to increase enrollment, we can help to build a budget that will support our shared aspirations for this campus.


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