September 20, 2010
Good morning. It’s a good day to begin what I hope will be an exceptional year for students, faculty and staff. Welcome!
This room is full, and I know others are watching over the Internet from our Palm Desert Campus, from the Student Union Theatre, and from homes and offices, as well.
This is my 14th Convocation, and after so many sleep inducing, hour-plus presentations, this should be a good year to redeem myself with a crisp, brief, interesting 20 minutes of comments. Unfortunately, as you know by now, I can’t change. So it’ll stay predictably long and numbing.
Someone once said that the amazing thing about the human brain is that it’s already working when you’re born, but stops the very minute you start a public presentation. Too bad.
As at prior Convocations, I’ll introduce the Faculty Senate Executive Committee, new leaders of ASI, new academic department heads and new administrators.
I’ll take a few moments to recall colleagues of the university who died last year. I’ll recognize those who earned degrees, announce staff award winners and describe their accomplishments.
I’ll also discuss this year’s budget situation, some relevant regional issues, and our enrollments. I’ll then share remarks about a few key achievements over the past year, as well as outline goals for the new year. At the end of the hour, we’ll view the annual highlight video, which I also use when I give off-campus talks.
As always, I encourage your comments, whether by e-mail; at open meetings with faculty, staff and students; at the reception; or give me a call. Your suggestions and comments are particularly important during a year in which we’ll have formidable budget challenges.
To begin, I’m pleased that despite our budget cuts, layoffs only occurred in a unit that chose layoffs over furloughs. This reflects the commitment, especially, of the vice presidents, deans and department heads (to helping the university meet one of its goals, and that was to preserve employee positions).
Second, last year we had record grants and contracts activity, with $28 million in expenditures and more than $33 million in new funding, triple or more what they were just 10 years ago – and each substantially higher than the prior record. The College of Natural Sciences literally exploded with grant success, increasing new awards from $3.2 million to more that $14.5 million. Even before these new peaks, CSUSB generally ranked among the top five CSUs, with all the others much larger, and with an array of doctoral and engineering programs.
Third, when compared nationally to institutions with student demographic backgrounds similar to CSUSB students, our six-year graduation rate is in the top 11 percent. Among CSU campuses, we rank No. 1 in the first-to-second year retention of African American students and No. 3 in the retention of Latino students. In addition to being No. 12 nationally in Latino undergraduate degrees awarded, we’re No.1 in the U.S. in math degrees earned by Latinos. Thanks to all of you for furnishing our students with rich opportunities for success.
Next, led by Provost Andy Bodman and Associate Vice President Olivia Rosas, our enrollment management team looks to have weaved its way successfully through tortuous rules and the shifting sands of initial guidelines that outlined penalties for over-enrollment. However, since the rules have changed entirely, we won’t know for certain until three weeks into the quarter – the official census date – how close we are to our original target. In fact, because we received $4 million in new one-time funds, we’re expected to employ the money to enroll an additional 300-plus FTES.
I want to applaud the university community for coming together to develop a valuable new strategic plan, which will be followed this year by the development of vice presidential areas plans.
I’m also quite pleased with the President’s Academic Excellence Scholarships program, which offers scholarships to San Bernardino County students in the top 1 percent of their high school graduating classes. This fall, there will be nearly 170 students on campus who were recruited as PAES scholars – about 1 percent of our total enrollment. Overall, there have been 225 PAES students since 2002, when it started with a scant six acceptances, grew next year to 15 new students, then 25, 35, and 41, where it’s hovered ever since. These students lift the quality of the university, and they graduate at remarkable rates.
Finally, in a late development, the Pfau Library, the Water Resources Institute and the College of Natural Sciences, with some central support, were able to collaborate with UCR to bring the State Water Resources Archive from UC Berkeley to the CSUSB and UCR libraries. Given 7,500 linear feet of key maps, documents, agreements and the like, this will prove a very meaningful development – both in supporting campus research and in providing crucial information needed in the communities we serve.
Now let me offer a serious – but I hope not too dense – commentary on some factors that triggered the ravenous cuts we’ve experienced, what we’ve done about them, and what we plan to do about our priorities this year – though, as I said, we still have no guidance from the state about this year’s funding.
In terms of this staggering recession, that’s where the nation, the state and the CSU have come from – the balcony – and we’ve fallen hard. Let me offer my take on the situation.
First, we’re part of the international economy – rising and falling with it. Actually, California – due to having its housing bubble burst – may have been as much a cause as a victim of the global recession – the worst economic tailspin in about seven decades. In fact, California’s per capita income even declined 3 percent last year, the first time since before WWII.
Our state’s unemployment rate is the third worst in the nation, and the Inland Empire’s unemployment level of 15.3 percent stands second only to Detroit among metropolitan areas. It would be over 20 percent if underemployment and quitting on the job market were considered.
Complicating matters, the state has about 12 percent of the U.S. population but roughly 30 percent of its welfare cases. And you’ve heard that state prisons now consume about a tenth of the state budget, essentially the same as higher education – with each prisoner costing almost $50,000 a year, which is nearly 10 times what we receive from the state for each CSUSB student.
California’s tax structure also complicates matters, with deep dependence on income tax revenues, which decline sharply during recessions. Proposition 13’s limits on property tax increases added hurdles by limiting revenue streams – mainly those for K-12 education.
But our situation isn’t merely financial. It’s also linked to California’s totally dysfunctional politics – with the roots, I believe, branching from districts that are rigged to be “safe” for Democrats or Republicans. Because of these so-called “safe seats,” the Legislature is in fact elected by the core constituents of each party in primaries, with little real competition in the general elections.
Politicians seeking election appeal to their partisan bases – driving Democrats further to the liberal left and Republicans harder to the conservative right. The gap between the parties therefore grows, and those who are in the political center – or are liberal on some issues and conservative on others – are not vital to political outcomes.
The sharp differences in the views of the parties is especially important because it takes a two-thirds vote to pass a budget in the Legislature – and because those members who dare to break with their party caucuses will normally be punished in the next election.
Term limits have added a new wrinkle, with inexperience reigning so heavily that legislators depend even more on the advice of lobbyists who, not coincidentally, supply funding for increasingly expensive elections.
Overall, the result is that the Legislature has largely abdicated its responsibility to California’s future. By not providing funding, while at the same time politically posturing when we raise fees – despite the fact that we’re in the bottom 12 percent among public universities in what everyone else calls tuition and fees – I believe they’re endangering California’s future, where we already stand a dismal No. 46 among the states in the percentage of 19 year olds in college.
In the past eight years, controlling for inflation, state support per student has plunged 33 percent – one-third. In actual dollars, we fell from $8,700 to $5,800 per student. And since 1980, again compensating for inflation, California’s support for higher education plunged by nearly 48 percent, and in that period, higher education plummeted from 20 percent of the state budget to 10 percent, while prisons soared from 3 percent to 10 percent.
As a direct result, I believe, during this time, California slumped from No. 1 to No. 14 among the 15 most populous states in the proportion of the population with a bachelor’s degree. As you may recall, the Public Policy Institute of California estimated that our state would be short by 1 million college educated workers by 2025 – and we’re going in the wrong direction.
The public and politicians esteem higher education, but I don’t think they understand our profound economic and other impacts which multiply through the economy and society.
In general, the economic activity created on our campus alone returns more than $5 for every general fund dollar invested here. For CSUSB, overall spending is more than $300 million, when we include construction, housing, grants and contracts, and more – far in excess of the $83 million in general fund dollars that we receive. In addition, of the 70,000 CSUSB alumni, 63 percent remain in the region – and when their spending is factored in, the impact is over $2 billion.
Actually, for the state and the Inland Empire to succeed, they will need higher education to foster more investment and tax revenue. Our problems of poverty, social fragmentation, crime, homelessness, and the like all have origins in low educational achievement.
And what’s true of the importance of education at the regional level is also true for individuals. As of this past July, for example, those without high school diplomas were unemployed at nearly a 15 percent rate nationally, about 10 percent for those with high school diplomas, and 5 percent for college graduates. A similar pattern exists for income and for voting, civic participation, volunteering and the like.
We’ve already passed the record for being late with a budget. The legislative logjam may carry all the way past the November elections, though in a casual conversation I had with Assembly Speaker John Perez at an awards event over the weekend, he said the budget would be finished by the end of the month.
There’s some hope that the voter approved citizens’ redistricting committee will redraw legislative districts to eliminate safe seats, and together with the voter approved open primaries, in which the two top finishers meet in the general election, will cause candidates to appeal to independents and members of the other party and, when needed, make meaningful compromises, instead of pitching only to their respective, more ideological bases.
Contrary to the master plan’s promise of an education that’s as nearly free as possible, CSUSB students now pay 47 percent of the direct cost of their education. In fact, California contributes less to our students’ education than does Alabama, Arkansas, Mississippi, West Virginia and many other states. When grants, fundraising and other revenues are added to the mix, the state’s share of each student’s education free falls to less than 40 percent.
Now if California contributes less than many other states, and students pay less than at all but 12 percent of public universities, we’re apparently working with less funding than virtually anywhere.
In fact, if we didn’t have the 2009-10 fee increases, which generated $14 million, there would be far fewer students at CSUSB, far fewer course sections, and far fewer faculty, staff and administrators. More concretely, if our employees average $55,000 to $60,000 in salary and benefits, without that fee increase, there would 250 fewer of us at CSUSB and perhaps 6,000 fewer employees in the system.
Unfortunately, the master plan expired long ago. The UC knows this and now charges more than twice as much as we do, while protecting those in need.
I believe we hurt our poorest students by limiting our charges. Why? Because our neediest students are readily covered by financial aid. In fact, 56 percent of CSUSB students don’t pay any fees at all, and another 8 percent pay only partially.
With a rise in Pell grants to $5,350, the availability of Cal Grants and state university grants, as well as scholarships, and with $120 million in financial aid available at CSUSB, the needy wouldn’t pay even with fee increases. Plus there’s also the new Obama tax credit for higher education costs for families with incomes up to $180,000 a year. In general, dependent students from families making $70,000 or less have their fees covered. In addition, if we had higher fees, we would receive more funding from federal sources, because federal assistance is linked to tuition levels.
A 5 percent fee increase was already adopted for this year, and another 5 percent will likely be proposed. Even with these additions, CSU fees will be lower than each of the 15 CPEC comparators were a year ago. Together, the higher fees would generate about $6 million for our campus, and the funds are part of our budget plan. Given that our best guess is that we’ll need to make up $12 million in baseline funds for the year, without the fee funding, you can simply extrapolate the impact there could be on student programs, access and job security.
What’s the budget picture apt to look like? You’ll recall that last year, between budget cuts and unfunded mandates, we needed to find $26 million. After raising fees 32 percent, we still faced a greater than $17 million deficit. A little more than $10 million of this shortfall was covered by furloughs, which came to an end on June 30.
The $10 million saved by furloughs must be found in the coming year. When added to some modest increases in mandatory costs, we project a baseline deficit of approximately $12 million, which assumes our state baseline funding remains the same as last year.
We don’t expect to be cut any more this year. Because of maintenance of effort clause in the federal stimulus funding, the state cannot further reduce higher education spending without losing stimulus funds for other state programs.
When encountering possible budget deficits, there are only two choices. Either we raise more revenue or we reduce spending. In accord with system directives, which were caused by the difficulty of offering quality programs while simultaneously taking painful cuts, we targeted nearly a 10 percent reduction in FTES – more than a thousand fewer students.
Both for enrollment and fiscal reasons, we shifted summer sessions from state funding to the College of Extended Learning. This helped reduce our state-supported enrollment for next year, while it also secured $6 million in campus revenue and budgetary savings.
The fee increases are intended to counter-balance the reduced fee collections that result from this year’s lower enrollment. So the rise in fees won’t lead to any new net revenue. About $1 million of the remaining campus baseline reserve funds will also be applied toward the deficit.
Therefore, this year’s anticipated shortfall is $5 million. That is, $12 million in an overall deficit, minus $6 million from the summer, minus $1 million in reserve funds, leaves a $5 million shortage. We’ll continue to try to protect academic programs, as we have in past years.
Especially now that we’ve gotten – less than two weeks ago – notice that we’ll receive $4 million in one-time stimulus funds, we’re quite likely to be able to achieve the necessary cost savings without layoffs of permanent employees. However, as welcome as the funding is, it’s only a stopgap measure for this year alone. Unless we have added baseline funding, it’s possible that some temporary employees won’t be renewed, and there’s the possibility of some permanent employee reassignments. While such actions would be unfortunate, they’re far less severe than those on various other campuses across California and elsewhere.
There are also some slender rays of hope. Governor Schwarzenegger continues to include restoration of the $305 million in cuts last year to the CSU system that he and the Legislature promised were one-time. CSUSB’s share of that $305 million is roughly $12 million. There’s also an additional $60.6 million system funding proposed for added enrollment. In fact, the governor said that he won’t sign a budget that fails to include his higher education priorities.
In addition, both the Democrats and Republicans also have the $305 million and $60.6 million in their respective budget proposals.
Unfortunately, we can’t rely on that funding. By the time the governor and Legislature agree on a budget, it may include all, some or none of those funds. Since we’re already nearly three months into the fiscal year, we must plan for no change in our budget.
As we have in the past, we’ll simply play the cards we’re dealt as thoughtfully as possible. And we’ll continue with the broad elements of our ongoing approach – being transparent, offering multiple venues to keep everyone informed, being open to advice from all sources, protecting academic programs without overly compromising the rest of the campus, spreading cuts as much as possible over several years, concentrating on a mix of long- and short-term strategies, and seeking ways to make the crisis work for the long-term benefit of the university.
I’ll offer updates as the budget landscape comes into better focus. Whatever the outcome, I’m confident that the character, integrity, talent, creativity, honest effort and commitment you’ve demonstrated during this cycle of budget challenges will sustain us by productively focusing on our core teaching, research and service missions, as well as preserving employee jobs.
Just a word about enrollments: a year ago, we registered just short of 18,000 students. In the past decade, our freshman class has more than doubled, with African American enrollments nearly tripled and Latinos up more than fourfold. In fall 2009, the latest with complete data, 46 percent of the freshman class was Latino and 14 percent was African American – each no worse than the third highest in California. And, overall, 70 percent of our graduates are the first in their immediate families to complete a bachelor’s degree – which is about triple the average.
As I said earlier, because of funding and a system directive, we reduced state-funded enrollment by nearly 1,000 FTES. We did this by declaring impaction, setting application deadlines, not accepting lower division transfer applicants, strictly enforcing probations and disqualifications, and making certain that super seniors – those with more than 210 credits – would graduate in a credit-efficient manner. At the same time, we sought to be especially attentive to veterans, foster and disadvantaged youth.
Let me now chat a bit about our priorities. You’ll recall that I appointed a blue ribbon efficiency-effectiveness committee last year. It was chaired by provost-emeritus Lou Fernandez and contained several CSUSB faculty and staff, as well as retirees such as our previous budget director, Bill Takehara, as well as former presidents of other institutions of higher education.
After receiving suggestions from the campus community, the committee formulated various recommendations. They’ve been shared with you previously, and I’ll present later this quarter a full report on the disposition of the committee’s recommendations.
Given the importance of the coming year, you won’t need to crane your neck to know what we’re doing. In fact, I want to comment at some length about our priorities.
We’ll engage in various strategies to help make the university more effective. And given budget cuts, we’ll also seek to reduce expenses and raise revenue. Most of the approaches are rooted in strategies I’ve outlined in many prior communications and budget meetings or were recommended by the efficiency and effectiveness committee, to whose members we owe thanks for thoughtfully working without compensation.
Our revenue improvement targets include increased fundraising and grants and contracts funding by 15 percent or more over the next two years. In order to promote fundraising, we’ll centralize development officer reporting lines by early winter quarter in order to create teams, focus on major and planned gifts, as well as on campaigns, including planning for the 50th anniversary.
We’ll also seek to double the size of the foundation board to about 140, both to involve more potential donors and have many of them participate on college boards. And we’ll shift responsibility for our endowment to the advancement office.
To control cost and further increase grants and contract activity, we’ll co-locate pre and post grants business operations, and I’m considering having it all report to the associate provost for research, Jeff Thompson. In any case, we’ll target a 15 percent minimum increase in grants and contract funding over the next two years.
We’ve already shifted summer sessions to the College of Extended Learning to enhance revenue, and we’ll also target a 10 percent increase in return from the bookstore and food services.
To better integrate enrollment processes, the associate vice president for enrollment services now reports to the provost rather than to student affairs. During the year, there will also be an emphasis on improving data, as well as focusing on college, department and graduate-level enrollments.
To advance international programs and enrollment, we consolidated the International Center and the International Institute. The new unit will be named the Center for International Students and Programs, and will report to academic affairs through Associate Provost Jenny Zorn. Given their predictable importance in this new century, there will be continuing emphasis on China and a new focus on linkages to India. Our two-year goal will be at least a 20 percent increase in international enrollment on campus, as well as a 20 percent rise in the number of our students studying abroad – which I’m pleased to note reportedly more than doubled to 265 last year.
Other academic priorities for the year involve a review of CSUSB’s general education curriculum, and an examination of how we must respond to Senate Bill 1440, which will require us to accept a 60-semester hour community college associate degree and limit how many additional credits we might require for a bachelor’s degree. In addition, we’ve undertaken a long-term focus on our 6-year graduation rate – which now stands at about 47 percent -- quite high given the socioeconomic and other characteristics of our students, but we want to move it higher. Part of the strategy will be to examine early start options for students who need remediation.
The provost will also work with others to reinvigorate the honors program – in part by better connecting it with PAES scholars. And if we do receive additional baseline funds, among the highest targets will be hiring more tenure-track faculty.
In addition, where possible, we’ll redouble efforts to create helpful synergy-creating partnerships. For example, to enhance service and reduce cost for transportation, hotels, and rental cars, we’ll partner with UC’s Connexus travel program. We’re also working with UCR to seek economies in security, parking and utilities at the Palm Desert Campus. And under contract, we’ll serve local community colleges, school districts and others as a dispatch hub.
We’ll continue on our facility development schedule – with completion of the nursing lab, renovation of the recently expanded health center, construction of the privately-funded observatory, planting of a non-state-funded conservation garden, planning for the new wing of the library, and pursuit through lease-revenue and private funding of a $62 million theater addition to our performing arts facility.
My office and each of the divisions have been charged to identify 10 percent administrative costs saving over the next two years by close examination of operations and process streamlining.
We’ll also hire an internal auditor to coordinate audits, respond to findings, follow-up on recommendations, and undertake internal audits in high-risk areas.
Our facilities personnel have already helped us save considerably from utility initiatives such as L.E.D. lighting, a well to serve half the campus’s landscape needs, and major solar installations. Once two wind turbines and a fuel cell are in place, we’ll be able to cover with green energy one-half of our peak daytime load and save considerably, as well. Smart metering of buildings will also help locate inefficient energy uses.
Actually, to conserve, we’ll also seek to be as paperless as possible, and we’ll centralize about 200 obsolete servers, which should save one-half on electricity. To further cut unnecessary costs, we’ll package laptop and related purchases several times a year, reemphasize the use of energy-saving verdiem software, and shift students to g-mail, which is free and results in significant university savings. In addition, we’ll review the coverage and deployment of video cameras on campus.
The faculty senate recommended, and I’m inclined to authorize, that smoking be confined to 16 outdoor sites.
Finally, depending on the final budget for the year, I may ask the faculty senate and others to examine whether to consider a shift to a semester calendar.
Crisis conditions, stress and ambiguity test us as individuals and as an institution. How we respond to fiscal and other challenges is a pivotal measure of our individual resilience – which, in turn, determines the university’s ability to adapt.
In difficult times, we sometimes want to hunker down and narrowly define our own work. But life is an echo, as the Chinese expression suggests, and what we send out comes back.
We’re a community in that we have a shared membership and a shared fate. Whether we’re a healthy community is up to us – not anyone else – in how we interact with one another and how we meet the headiness of success and the challenges of adversity.
We also need to speak clearly – and wherever possible with one voice – about student needs and campus funding. Sometimes we get not what we asked for, but what others think we want – or even think we need. So we must concentrate on our communications both internally and to those whose support we need. That communication will be an important priority for the year.
Finally, let me thank you for providing the support necessary for us to work through the budgetary crunch we’ve experienced. I encourage your ongoing input and feedback. For us to succeed we need to remain collaborative and collegial, avoiding the kinds of destructive divisions that now beset many universities, as well as engulf Sacramento and Washington.
The ultimate goal of higher education is to be agents of change – to help create a better world through our research and creative activities, through our service, and through the provision of quality academic programs that give our students opportunities for fuller lives.
Thank you for attending this morning and congratulations to each of you for contributing to the university’s success in being a meaningful agent of change! I’m proud to serve with each of you.
For reference, the video of the speech is located in ACM's Video Library under the link "Convocation 2010.”