Wednesday, March 23, 2011

Chancellor's Dislike for Unions is Growing

The following letter was sent to CSU Chancellor Charles Reed after the CSU Chancellor crossed a picket line and conducted a closed-door meeting at a hotel in Long Beach which is listed by multiple labor unions on their "Do not patronize" list.

Dear Chancellor Reed:

As you know, the Closed Session on Executive Personnel Matters of the California State University Board of Trustees on Monday, March 21 is scheduled to take place at the Long Beach Hyatt Hotel. This is a hotel that is known to be listed on a union “Do Not Patronize” list.

As you also may be aware, we do not schedule events at hotels that have been placed on “Do Not Patronize” lists as an acknowledgement of our concern that these establishments may be engaging in harmful practices toward working Californians.

As statewide public officials who serve as ex officio members of the CSU Board of Trustees, we believe that the entire Board of Trustees should maintain an ongoing relationship of mutual respect between the University and its many union employees. Therefore, we are asking that the University not hold events at locations that are on “Do Not Patronize” lists.

Additionally, in these tough economic times, it would seem to make more sense for the University to utilize the meeting space at its headquarters, as it does in most other instances, rather than contract with any private entity for outside meeting space.

We appreciate your attention to this situation.

John Perez, Speaker of the Assembly,
Tom Torlakson, Superentendent of Public Instruction
Gavin Newsom, Lt. Governor

The signed copy of the letter may be viewed here.

Tuesday, March 22, 2011

CSU to Cut 10,000 Students?

Today's Sac Bee had coverage of the March Board of Trustee's meeting in Long Beach. The implications of having the proposed tax extension fail are becoming even more alarming:

California State University campuses may cut enrollment by 10,000 students for the 2011-12 year as part of a larger plan for dealing with budget cuts, officials told trustees during a board meeting today in Long Beach.

Gov. Jerry Brown has proposed cutting the CSU budget by $500 million, or 18 percent, if legislators and voters approve a series of tax extensions. At the board meeting, CSU officials presented some big-picture strategies for handling the cuts. In addition to cutting enrollment, they said they'll ask CSU's 23 campuses to collectively cut $281 million and the chancellor's office to reduce its budget by $10.8 million. Staff reductions appear likely, though few specifics were given.

"Because 84 percent of CSU's operating cost is for personnel, the CSU will need to reduce expenses in that area by at least $250 million," a statement from the university says.

CSU will not consider furloughs unless the budget cuts are deeper than $500 million, said CSU Chancellor Charles Reed. That could happen if Brown's proposed tax extensions don't get on the ballot or are rejected by voters. In that case, Reed said, the CSU could see cuts of $1 billion.

"A reduction of that level would force us to reexamine potentially drastic measures including much larger cuts to enrollment and increased tuition fees among other strategies," Reed said in a statement.

Trustees also heard a report from a consultant who compared compensation for CSU presidents and faculty with compensation at comparable universities across the country. The consultant found that CSU pays lower salaries than its comparison schools but gives more generous benefits and retirement plans.

The average salary for CSU campus presidents is $292,830, compared with $444,556 for presidents of comparable schools. The average salary for CSU faculty is $85,083, compared with $99,882 at comparable schools. But benefits for CSU presidents were 25 percent higher than the comparison group and benefits for faculty were 21 percent higher.

On balance, the consultant concluded, when salary, benefits and retirement are combined, CSU presidents come out behind comparable schools by 26 percent, while faculty are 1 percent behind, making them pretty much on par with their peers.

Source: Sacramento Bee 3.22.11

Friday, March 11, 2011

What if the Tax Extension Fails?

If Gov. Jerry Brown fails to get his tax-hike extension proposal before voters, a partisan standoff in Sacramento will then block budget-balancing cuts, a competing onslaught of citizen initiatives will hit the ballot, and the state will teeter on the brink, Brown tells George Skelton in today’s Los Angeles Times.

“It’ll be a war of all against all,” Brown said.

Brown has proposed closing the state’s $26.5 billion deficit half with cuts and half with extensions to temporary income, vehicle and sales tax hikes – the latter of which he wants to put before voters in June. But he needs two Republican votes in each chamber to qualify the measure for the ballot. As of this morning, he hadn’t found those four votes. He had hoped to have enough support for the Legislature to vote today to put the measure on the ballot.

Five GOP senators – including Tom Harman, R-Huntington Beach – have broken ranks with their fellow Republicans and have implied their support if Brown agrees to a slate of reforms to the budget, pensions, business regulations and taxes. Brown has not accepted the package, but has indicated there’s further room for negotiation.

If no deal is reached, Brown said he would send a budget to the Legislature in which the gap is closed solely by cuts, which would included slashing K-12 education spending.

“Then the Democrats change it and put in gimmicks,” Brown tells Skelton over lunch in his 1,400-square-foot Sacramento loft. “Then I veto it. Then everybody sits there until we run out of money….

“There’ll be initiatives on taxing wine and beer and oil companies and a split roll (proposing higher property taxes for commercial real estate). “And Republicans will counterattack” with anti-union measures and efforts to undermine the public sector.

“There’ll be an unleashing of left and right forces. Everyone will come out fighting. California will become a battleground…. It’ll be a war of all against all. The loser will be the people of California.”

Source: OC Register

Note: If the tax extension measure fails, the direct cut to the CSU could be as high as $1 billion dollars.

Wednesday, March 2, 2011

Budget Committee Confirms $500 Million CSU Cut

From a statement released today by the Chancellor's Office:

Joint Legislative Committee Confirms Cuts to the CSU’s Budget

The Budget Conference Committee acted Friday to confirm Gov. Jerry Brown’s proposed cuts to higher education, which include a $500 million reduction to the CSU’s 2011-2012 budget.

The Budget Conference Committee, which is made up of five members of each house, has been meeting to work out the differences between the Assembly and Senate versions of the budget bill. The meetings are part of the annual budget process, which has been expedited this year to meet the governor’s request for a completed budget by March 10.

The accelerated pace is based on the governor seeking a special election in June for voters to approve an extension of the personal income tax and state sales tax, as well as the vehicle license fee, due to expire by June 30. The tax extensions and other tax changes will provide over $10 billion in revenue to help the state close an estimated $26 billion deficit.

If the governor cannot garner the two-thirds vote from the legislature needed for the special election, or if the election is held and voters reject the tax extensions, the CSU may face additional significant reductions.
The current proposed budget cut of $500 million would drop the CSU’s level of state support to just under $2.3 billion, the same level of support it received more than a decade ago, but the university is now serving nearly 70,000 more students.

CSU Chancellor Charles B. Reed and several other CSU officials have been meeting regularly with legislators, the Department of Finance and the Legislative Analyst’s Office to underscore that continued reductions in the CSU’s funding will stall the state’s economic recovery and ultimately place its future at risk.

CSU-related spending supports more than 150,000 jobs annually in California and the CSU each year provides 95,000 job-ready graduates to the state’s most competitive industries—industries which account for nearly 5 million jobs in California.