State Budget Crisis: Payments Delayed and Furloughs Enacted, CSU Exempt
As the governor and legislators continue to negotiate over a budget plan to close the state's estimated $42 billion budget deficit, State Controller John Chiang this week began delaying payments to state programs, vendors and other businesses for 30 days. If a budget accord is not reached, the controller has warned that these delays could be extended or he may be forced to begin issuing IOUs. Under the State Constitution, however, the state has an obligation to meet its payment to public schools and public higher education systems. Therefore, CSU employees will continue to be paid. Read the list of priority payments here:
Gov. Arnold Schwarzenegger's December Executive Order requiring furloughs two days per month for state civil service employees will be implemented Friday. Last week, a Superior Court judge rejected arguments from several state employee unions alleging that the governor's action was illegal and unconstitutional. Since the court's ruling, the governor has expanded the scope of the furlough plan by sending the required documents to the State Controller's Office to furlough employees of the state constitutional officers (lieutenant governor, attorney general, state treasurer, state controller, secretary of state, superintendent of public instruction and members of the Board of Equalization).
The CSU is outside of the governor's direct jurisdiction and exempt from his furlough orders. Nonetheless, the governor's executive order requests that the CSU, the University of California and the California Community Colleges implement similar measures. The CSU is not planning furloughs at this time, but it has implemented several cost saving measures including: limiting student enrollment for fall 2009, freezing executive level salaries, restricting travel, deferring purchases, and holding vacant positions.
The longer the state delays reaching a budget compromise, the more at risk the CSU is to deeper budget cuts that will significantly impact programs, services, payroll and personnel. The chancellor, vice chancellors and campus presidents have been meeting regularly to plan operations under a variety of different budget scenarios.
Change in Cal Grant Disbursements
Cal Poly Pomona normally receives Cal Grant advances for spring quarter in March. Therefore, the campus could experience delays in Cal Grant advances if the state budget impasse continues. The university has committed to defer the collection of the state university fee for students who experience a delay in receiving their Cal Grants. This action is to ensure that the university's financially neediest students, who rely on Cal Grant A and B awards to cover their state university fee, will be able to enroll for the spring 2009 term.