CSU officials say proposed nearly 8% state cut and compact deferral would force deep program, staff reductions

At a finance committee meeting of the California State University Board of Trustees, trustees, university presidents and system budget staff warned that the governor’s 2025–26 budget proposal — which includes a near 8% cut to CSU’s state general fund and a deferral of compact funding — would force steep program and personnel reductions across the system.

The committee heard systemwide budget staff lay out the numbers, campus presidents describe actions already taken, and trustees discuss an intensified advocacy campaign to try to restore funding before the May revision. Ryan Storm, a budget staff member who led the system budget presentation, said the governor’s proposal “included a nearly 8% cut to the CSU state general fund appropriation. This would be a $375,000,000 ongoing reduction to our state support.” Storm also described a proposed deferral that would push compact payments into later years as two one‑time payments of $252,000,000 planned in 2026–27 and 2027–28.

The compact deferral and cut would widen a projected and systemwide budget gap that trustees and presidents said has already driven multi‑year reductions in courses, staff and programs. Trustee Lydia Lopez, who convened the committee, told colleagues the system faces “tough times” and warned that, while the governor signaled support by deferring compact payments, “the odds that we will ever get that money are not good.” She added, “There are no easy reductions left.”

Why it matters: CSU receives roughly 60% of its funding from the state; officials said that even with recent tuition increases and prior compact funding the system cannot absorb a $375 million ongoing reduction without cutting into core student services and instruction. Budget staff said campuses used about $266 million of one‑time funds last year and that system reserves stood at about $777 million — roughly 33 days of operations — and are expected to be drawn down further as campuses smooth short‑term deficits.

Campus examples and immediate impacts

Three presidents described specific impacts: San Francisco State President Lynn Mahoney said the campus had cut roughly 15% of full‑time equivalent positions since 2019 and reduced course sections by 19% since 2022. Mahoney warned of further harm to students and faculty if the state enacts the proposed reductions, saying, “Cutting jobs may provide a temporary financial fix, but it risks undermining the very foundation of the university's mission to provide high quality education.”

Sonoma State President Cathy Cutrer described a planned $24,000,000 deficit for the next fiscal year and detailed targeted actions the campus is taking to close the gap. She said the campus expects to eliminate about 23 degree programs affecting roughly 302 enrolled students, 27 tenured or tenure‑track positions, 19 full‑time lecturer positions and approximately 60 part‑time lecturers. Cutrer also said Sonoma plans to discontinue NCAA Division II intercollegiate athletics, a move that affects 11 teams with rosters the campus described as ranging “from about 195 to 235 students annually” and 36 coaches and staff; she said the university will continue to honor scholarships and is working with the NCAA and conference to place athletes elsewhere when possible.

Cal State Monterey Bay President Vanya Quinones said her campus has absorbed $23 million in cuts over two academic years (about 16% of its state allocation) and that a further 8% reduction would “jeopardize what we have done to stabilize the future of our university,” including harms to retention and graduation. Quinones reported an early retention decline after prior cuts and warned that repeated reductions erode capacity to recover.

Systemwide effects

Budget staff said campuses have already reduced course offerings and student support: one system slide cited the elimination of roughly 1,430 course sections at several campuses in a single year (equivalent to about 35,000 student seats) and the trustees’ 2024 action to suspend or discontinue 136 programs systemwide. Staff emphasized that about 75% of CSU operating costs are employee compensation, and that fixed costs such as health care have grown sharply; staff said employee health care costs increased about $129 million over two years with another $60 million expected in the next year.

Advocacy and next steps

System leaders outlined a layered advocacy campaign aimed at the governor and Legislature. Vice Chancellor Sachs and Nathan Dietrich said the system had already held dozens of meetings with state officials — including more than 60 engagements since adoption of the CSU budget plan last fall — and planned coordinated events including CSU Advocacy Day in March and a Trustees Advocacy Day in late April. Staff asked trustees and campus constituencies to mobilize alumni, students and local advocates for hearings that will occur through the spring and around the May revision.

Formal action taken

The committee opened with and approved the consent agenda. A motion to approve the consent agenda was made and seconded; a roll call recorded unanimous affirmative votes by the trustees present and by the chancellor.

What the committee did not do

The session was informational for the budget proposal; there were no formal policy votes on cuts, program closures or campus‑level actions. Presidents and trustees emphasized that campus decisions to close programs or reduce staff are local actions driven by campus budgets and that the Board will continue to press the state for restored funding.

Ending

Trustees closed by urging intensified outreach to local legislators, media and constituency groups. System leaders said they will continue close monitoring of the May revision and continue “all hands on deck” advocacy to seek restoration of compact funding and alternate solutions to an ongoing reduction.