A Message from the Chancellor: Financial Update

As part of my continuing effort to keep the CUNY community informed of local and national economic developments and their effect on CUNY, I am sharing the latest budget-related information from the state and city.

On November 12, Governor Paterson announced a series of actions that would generate $2 billion worth of savings in the current fiscal year (2008-09). These initiatives were intended to address the state's projected deficit of $1.5 billion this year. The State Division of the Budget projects that the deficit will grow to $12.5 billion for the next fiscal year.

Governor Paterson called for a special session of the legislature on November 18 to address the deficit and his proposed plan. However, agreement could not be reached on his proposals. No action was taken by the New York State Legislature.

The Governor's proposals included, for both CUNY and SUNY, a $600 tuition increase. This increase would have been effective for the spring 2009 semester, resulting in a $300 increase for full-time resident undergraduate students at the senior colleges. As of the fall 2009 semester, the tuition increase would have been a full $600 per year, raising CUNY's full-time resident undergraduate rate to $4,600 at the senior colleges.

For the first time, a governor proposed an investment plan that would allow a portion of the revenue from a tuition increase to be returned to SUNY and CUNY. Governor Paterson specifically proposed that CUNY and SUNY keep 10 percent of the additional revenue generated from this tuition increase in the current year. For FY 2009-10, the universities would retain 20 percent of the additional revenue for investment purposes.

The Governor also proposed reducing per-student base aid to community colleges by 10 percent. This would have resulted in 2009 in an $8.4 million reduction for CUNY's community colleges, the equivalent of a $270-per-FTE decrease. In addition, Mayor Bloomberg recently announced proposed reductions to CUNY of $5.1 million in city support for this year, and $9.5 million in reductions for next year. This is subject to the approval of the City Council.

Governor Paterson will release his FY 2009-10 Executive Budget on December 16.

CUNY previously sustained reductions of $17.7 million during the adopted budget process and $50.6 million during a special legislative session last August. These reductions were principally handled through prudent planning over the past year, based on our anticipation of an economic downturn, and the implementation of strategies to minimize the impact of cuts. Then, as now, the University's first priority in navigating this fiscal situation is the maintenance of our core academic mission and the protection of our services to students.

At the same time, the University continues to experience unprecedented student demand, with a record enrollment of 244,000 students. A November 11 article in The New York Times detailed the surge in applications to CUNY's six community colleges, which now serve almost 82,000 students. Linking a 15 percent increase in applications in September and October to the current economic crisis, the article describes how the community colleges are truly an engine for workforce development in New York City.

Up to $300 Tuition Increase for Undergraduates for Fall 2009

On November 24, the Board of Trustees Standing Committee on Fiscal Affairs met in anticipation of the full Board of Trustees meeting scheduled for December 8, 2008. The committee approved a resolution authorizing a tuition increase of up to $300 per semester for full-time resident undergraduates at senior colleges, up to $200 per semester for full-time undergraduate resident students at community colleges and comparable increases for graduate and professional programs and nonresident students, with a portion of the increase to be used for investment programs at both the senior and community colleges.

CUNY's 2009-10 Budget Request proposes to establish a $10 million Student Financial Aid Initiative, with revenue generated by increased tuition and philanthropy, to be used by colleges to assist students who would be placed at risk of continuing their matriculation because of tuition increases and to drive down the cost of textbooks for all students. CUNY has made a commitment that no student in need of financial assistance will be denied access to the University. CUNY has also created a new student jobs initiative to help students obtain part-time and full-time work and internships to help meet the costs of attending college. This includes a special arrangement between the University and the United States Census Bureau to host job testing opportunities at CUNY campuses.

CUNY has not had an undergraduate tuition increase for the past six years. In 2003, tuition was increased by $400 per semester for the senior colleges and by $150 per semester for the community colleges.

As many of you know from media reports, on November 18, the Board of Trustees of The State University of New York (SUNY) approved a $310 tuition increase for SUNY undergraduates in January 2009, along with an additional $310 increase in the fall, and a multiyear rational tuition policy.

Based on current finances, I do not intend to propose a tuition increase for the spring semester.

As part of our budgetary process, the three working groups I convened this fall-one to examine the University's core expenses, another its bylaws and policies, and a third the entrepreneurial use of its physical assets-have been meeting to study CUNY's present and future financial health. We will continue to be guided by the principles of our CUNY Compact, a shared model of financing that advocates a focus on public investment, private philanthropy, institutional efficiency, and a rational tuition policy.

In the meantime, we should be aware that the state's financial difficulties are affecting business operations at all agencies, including CUNY. For example, delays in purchase requisitions for equipment and facilities work have already been reported. We are working to resolve these delays and any other impediments to an efficient flow of business.

This month has also seen great progress at CUNY. Mayor Michael Bloomberg and State Assembly Speaker Sheldon Silver announced at a November 13 press conference that the Fiterman Hall project at Borough of Manhattan Community College received full funding of $325 million. The University can now proceed with the deconstruction of the existing structure and the rebuilding of a new Fiterman Hall. As you know, Fiterman Hall was irrevocably damaged in the 9/11 attacks, and its rebuilding is critical for the rapidly growing BMCC campus and for the entire Lower Manhattan community. Funding was the result of the committed work of many public officials, including Governor Paterson, Mayor Bloomberg, Speaker Silver, and the New York City Council, particularly Councilmembers Charles Barron and Alan Gerson, chairs of the council's Higher Education and Lower Manhattan Redevelopment committees, respectively. Many organizations and groups partnered on the development of the new Fiterman Hall: the Fiterman Hall Community Advisory Committee, comprising representation from community groups, such as Community Board #1 and the Alliance for Downtown New York, schools, such as Stuyvesant High School and PS 89, labor organizations, such as the New York City Central Labor Council, government officials, safety groups, regulatory agencies, and many more; BMCC President Antonio Pérez and the college's administration, students, faculty, alumni, and foundation; and CUNY's Board of Trustees, chancellery, University Faculty Senate, University Student Senate, Professional Staff Congress, and others. I am deeply appreciative of the tireless collective effort to make a new Fiterman Hall a reality. In this economic climate, especially, its rebuilding sends a national signal that New York City is moving forward and investing in its future.

I also extend my warmest congratulations to student David Bauer (Hunter College High School, City College, Macaulay Honors College), who was recently chosen as one of only 32 Americans to receive a Rhodes Scholarship, which awards funding for study at the University of Oxford in England. David, a senior chemistry major, came to CUNY as the winner of the 2005 Intel Science Talent Search and has since won both a Truman Scholarship and a Goldwater Scholarship while at the University. David is the third CUNY recipient of a Rhodes Scholarship in the last five years, joining 2004 winners Lev Sviridov and Eugene Shenderov. All of us at CUNY are deeply proud of David's success.

The future of our city depends on the talents and skills that students like David are developing in CUNY's classrooms and labs, and on the innovative research and outreach led by our world-class faculty. Our students' success is our city's success.

CUNY has never been stronger. I am confident that the University will meet its budgetary challenges with resolve and resilience, maintaining its commitment to academic progress and integrity and to supporting our students' educational success. Thank you for your many creative and dedicated contributions to that most important effort. Please accept my very best wishes during this Thanksgiving season and beyond.



Matthew Goldstein

November 24, 2008