Fall 2012 Convocation Speech

"Tough Present, Hopeful Future"
President Ruben Armiñana

Fall 2012 Speakers
August 20, 2012

Ruben ArmiƱana
President

Andrew Rogerson
Provost and Vice President for Academic Affairs

Margaret Purser
Chair of the Faculty

Karen Paniagua
Associated Students President

Marybeth Hull
Staff Representative to the Academic Senate

President Ruben Arminana

Welcome to the beginning of the 2012-2013 academic year. I join all of you in extending the warmest welcome to our new students, and to those students who are returning, it's great to have you back. This rhythm of approximately a quarter of our students beginning as new students each year and about the same number graduating at the end of the year is one of the special characteristics of the university and one that ensures change. There is always joy at the beginning and end of the academic year because we fulfill our mission of providing educational opportunities to a new cohort of young and inquisitive minds, and after a few years we can see that we have done well in preparing the graduating seniors for a life of achievements. Despite all the financial difficulties facing higher education in California, we are lucky to be a part of such a noble enterprise. As an institution and as individuals we have a great and positive impact upon our students, their families, and their communities.

I am also pleased that this convocation is being held at Weill Hall, our newest university space that will serve as a gathering place for so many academic and performance activities. Spaces are very important for human activities, and without a doubt this is a magnificent space, but what goes on in this Hall - bringing together education, music and performance - is what is really important. All components and spaces of the Green Music Center must enhance the academic quality and experiences of Sonoma State University and help in bringing the people of California and others to this university. The numerous and diverse activities planned for this and coming years make clear that excellence is achievable when vision, hard work, perseverance, and the support of many come together. This should serve as a model for our students for what they too can do. This is one of the reasons that I have great hopes about the future.

Unfortunately, actions taken in the last few years and contemplated in the next few months are presenting great challenges for the university and are compromising the quality of higher education that we are committed to provide to our students. California has gravely disinvested in its public colleges and universities. The state's support for higher education as measured against California's personal income is at its lowest level since 1965. The prosperity of our immediate future demands that we should be investing more in our students, the creative workforce and the future innovators, but California is doing the opposite and instead enormous amounts of resources have already been taken away and there are threats of more reductions beginning in January. Collectively the people of California must shout loudly and unambiguously to the Governor and the Legislators "STOP!!! Stop allowing the deterioration of what once was a world renowned public higher education system by continuing to make annual cuts to education. These cuts threaten our primary hope for a brighter future for California, which is an educated, talented, creative, and innovative workforce that can help California rebuild its economy. Not supporting education will irrevocably damage our State's future." We need to rebuild, not tear down education.

Let me give you a status report of where we are:
We began the fiscal year with a flat budget, no additional state appropriations to the prior year, 2011-12, which included $750 million in reductions. For your information, this budget reflects $968 million less than the peak state support of nearly $3 billion that was provided in the fiscal year 2007-08. In addition, the CSU has funded $135 million in mandatory costs increases, such as employee health care benefits and the costs of operating and maintaining new space. In prior years the state funded these mandatory costs. When you add the reductions and the mandatory costs, the CSU has $1.103 billion less to spend on its students, employees and facilities. This is the lowest state appropriation to the CSU since 1996, despite inflationary costs and teaching 95,000 more students (roughly 11 campuses the size of SSU).

Tuition and fee increases have resulted in many negative comments directed mainly to the Board of Trustees and the Administration of the CSU but these negative feelings should have been directed to the Governor and Legislature who are responsible for shortcomings in the funding of higher education. These tuition and fee increases account for only $593 million since the 2007-08 benchmark year leaving a net negative impact of $510 million. Since Sonoma State University accounts for approximately 2.3% of the CSU budget, our share of the negative impact is $11.73 million or close to 30% of our budget. I often tell business executives that if they were to lose 30% of their budget in such a short period of time they would have closed the doors and they agreed. Instead, we have covered this major resources gap with a number of strategies including management reorganization and downsizing, increasing class size, reducing instruction and student services, not replacing retiring faculty, staff and administrators, cost reductions at all levels, deferrals of purchases and projects, reduction in enrollment, and the utilization of one-time resources. As I said we have managed by spending one-time only funds so once they are spent, they are completely gone. So, this is what we call the structural deficit. We are still looking for $1.2 million to close this structural deficit by the end of the fiscal year.

This past November the Board of Trustees approved a tuition and fees increase of about 9% effective this fall semester which would yield an estimated $132 million net of financial aid and this would help the campuses with their structural deficit. In addition, spring semester enrollment is cancelled at half of the campuses, and for the other half, including Sonoma State University, it is limited only to transfer students from the community colleges in the SB1440 program. We expect that these transfer students will be very few. I am particularly concerned about the restrictions imposed on admitting new teaching credential students who often come in the spring semester and I expect an enrollment decline in the schools of education at all campuses. All students will be waitlisted for admissions to the 2013-14 academic year pending the results of Proposition 30 in November.

When the Legislature passed and the Governor signed the budget for this fiscal year, it included the expectation that the voters would approve the Governor's recommended tax increases in the November 2012 general election Proposition 30. If the voters reject this tax measure, then there would be automatic trigger reductions to balance the budget including $250 million for the CSU. This means that the state reductions would amount to $1 billion in the current year with one quarter of that billion to be achieved in the six month period of January 1 to June 30 of 2013. The pain would be enormous with only cruel choices ahead. Everyone at the university- students, faculty, staff, administrators, and community- would be deeply affected. The university would be very different.

In addition, the Legislature approved an expenditure of $125 million for the CSU and a similar amount to the UC beginning with the 2013-14 fiscal year and contingent upon the voter approval of the tax increases and the roll-back of the tuition fee increase this year. Given that we had already approved and collected the tuition and fees for the fall semester, the CSU has agreed to reimburse the students this amount if the tax measure is approved and we then hope that the approved funding for the next fiscal year becomes a reality. We all know that the State has not been able to keep many of the promises to education. At the same time, in the best of circumstances this legislative action creates an additional $132 million deficit this year, a continuing $8 million shortfall in revenues, and adds significant administrative costs associated with the reimbursement process.

Given all of these actions, even under the best-case scenario of the governor's tax initiative approval in November, the effective gap in our fiscal resources against the 2007-08 benchmark year would increase to $557 million. For SSU our share of this gap is approximately $12.8 million. This is unsustainable. Despite all the reorganizations, cost cutting measures, reductions in personnel, decreases in enrollment, and the expenditure of one-time resources, all of it combined would not be enough to close the gap. The university would have to be reconstructed in radical ways with the closing of programs and activities and a reformulation of the traditional ways of providing instruction. We would have to become a different university. Next month the Board of Trustees will consider a number of measures to address the $250 million trigger reduction; but I suspect that the measures would be significant and cruel.

The answer to this drastic situation rests with a greater commitment of the State of California through its Governor and Legislature to fund its public higher education. And this is where I have hope for a better future. When you are at the bottom of the well, there is only one way out and it is up. A recent study by the Stanford Institute for Economic Policy Research ("Public Higher Education in California: Examining the Fiscal Landscape of the 21st Century", April 18, 2012) concluded that unless significant actions are taken soon, the present conditions would lead to the end of all the state support for the UC and the CSU in ten years. Our 33 public universities would become for all practical purposes private institutions depending on at least doubling the cost of student tuition and fees and relying much more on sponsored research and philanthropy. This would be a very tough scenario for many of our institutions and workable for only a few; but the value of the report lies in that it clearly shows where we are going unless change is coming and soon. The continuous decline of state support will eliminate the public from higher education in California. The consequences for workforce development and job growth are enormous and the quality of life for Californians would be severely impaired.

The U.S. Secretary of Education, Arne Duncan, has chastised the states, including California, for cutting spending on higher education using the familiar phrase, "penny wise-and pound foolish." He said that the majority of the states are "undermining their own economic growth" and that, "Disinvestment is not the strategy that other countries are choosing." (The Chronicle of Higher Education, August 9, 2012).

Despite all of these negative issues I remain hopeful for a better future. This optimism is not based on a Pollyannaish characteristic of my mental attitude but it is based on the belief that Californians know that the bottom of the well has been reached and that there is only one strategy left and that is to reinvest in public higher education. This need to reinvest is not totally based on the fact that it is the good and right thing to do, it is the only thing we can do to achieve a better future. It is a rational strategy of self-preservation. It will not happen right away, but it has to be soon.

In the meantime, we will continue to do the best that we can do for our students. We will invest ourselves in their educational pursuits through the sharing of our knowledge, skills and life experiences. We will nurture and prepare them to be active citizens and leaders in society, capable of pursuing fulfilling careers in a changing world. They will develop a love of life-long learning, have a broad cultural perspective, appreciate intellectual and aesthetic achievements, and will be concerned with contributing to the health and well-being of the world at large. We will do this not just because it is our mission to do this but because our students are our hope for a brighter future.

Best wishes for this new semester.