Critical Challenges Ahead

The University plans proactive steps to manage financial strains and maintain hard-fought academic gains.

Millions of dollars in state budget cuts, reductions in state Tuition Assistance Program (TAP) awards and a murky economy pose critical challenges to the University this fall as rising enrollments continue to set records and a revitalized CUNY soars as an attractive higher education destination for students.

With the state budget enacted for Fiscal Year (FY)2011, the University has sustained up to $205 million in cuts since FY2009, forcing budget tightening across the campuses and further straining resources needed to match enrollments that are rising again this year.

As per Gov. David Paterson's vetoes of all legislative restorations, all TAP awards are reduced by $75; TAP will no longer be available to graduate students. Effective Spring 2011, students will have to accumulate credits at a faster pace in order to remain eligible. CUNY officials worked with the New York State Education Department to soften some of the new restrictions and are continuing to seek ways to ameliorate the impact. At the same time, a $200 increase in the maximum federal Pell Grant award for 2010-2011 is available for eligible students.

Chancellor Matthew Goldstein said at the Aug. 30 meeting of the Board of Trustees' Committee on Fiscal Affairs that the University would take proactive steps to manage the financial strains wrought by the state cuts, in order to maintain CUNY's hard-fought academic gains, programs and services, and to protect students. "It will get worse before it gets better," Chancellor Goldstein said of the fiscal situation.

He asserted tuition increases might be in the offing. "We are going to have to make some decisions on the revenue side," said the chancellor, who has advocated for small, annual tuition increases as part of the CUNY Compact, a public-private financing model aimed at creating a predictable funding stream for the University.

"This is the opening salvo for a serious discussion about what we face today in terms of our resources to manage the University, and create the necessary investment vehicles for us to continue to feed the University," he added. "We cannot stay where we are because the students are the ones that are going to suffer here."

The budget enacted by the Legislature for FY2011 provides CUNY senior colleges with $1.86 billion, and includes $84.4 million in operating budget reductions: $63.6 million in reduced state support and $20 million to be achieved from workforce actions, according to Associate Vice Chancellor for Budget and Finance Matthew Sapienza, who made a presentation at the committee meeting detailing the cuts and their impact.

The "acute strain" wrought by the reductions means "colleges will not be able to make planned investments, including critical hires that are needed to keep pace with growing enrollments," his report said.

The community colleges, which have seen a 43 percent enrollment surge since 1999, will sustain a $20 million loss to their operating budgets in 2011. This follows a $14 million mid-year combined state-city cut, including $7 million from college base budgets. As a result, the FY2011 community college allocation model is funded at only 90 percent, compared to the FY2010 allocation which covered 99 percent of proposed expenditures.

State base aid per Full-Time Equivalent (FTE) student will continue to decline at the community colleges; for FY2011 it has been lowered by $285 to $2,260, and since 2009 has come down by $415, Sapienza noted. Another concern: The community colleges' $186.8 million in state support includes $32.8 million in federal stimulus funds, which are non-recurring.

While feeling the pinch, CUNY's community colleges are seeing much of this fall's nearly 1 percent enrollment growth, according to early reports. Preliminary figures show University enrollment increasing from 260,000 to 262,000, compared with last year's record 6 percent jump. This includes increases in CUNY's online programs; the Online Baccal-aureate program had 902 students enrolled as of Sept. 1, up from 729 last fall, and the Online M.S. in Business, launched last fall with 35 students, had 86 new students enrolled so far with a total of 143 in the program.

The early figures also show the senior colleges becoming more competitive. Mean SAT scores of admitted students at the top-tier senior colleges have increased by up to 53 points, to as high as 1216 this year. Retention is stronger, too; more CUNY students than last year are choosing to stay in their colleges rather than transfer, the early figures show. As student applications flooded in last spring, the chancellor instituted a wait list for the first time in CUNY history, slowing admissions and redirecting wait-listed students to other programs, as a way to preserve academic quality amid tightening resources.

"If we admitted all of these students they would not get an experience that was real," he said.

Two-thirds of the 5,000 students on the wait list, approximately 3,300, were admitted to community colleges from the list this fall. Some 1,700 remaining students took up the University's new offer of low-cost remedial classes -- including the new CUNY Start skills immersion program and CUNY CLIP language immersion, to prepare for entry to community colleges in January 2011.

Other budget cuts taking effect include the city's reduction for the Vallone Scholarships program at CUNY, from $9.5 million to $6 million; the state budget's reduction of some $750,000 from CUNY Child Care centers and its elimination of the CUNY LEADS program for disabled students. The state and city budgets contain virtually no new funding for CUNY capital projects, Sapienza reported to the fiscal affairs committee.

"At the end of the day," the chancellor said, "we must increase revenue. Action is going to have to be taken in some way to sustain us."