Despite declines in enrollment at colleges and universities nationwide and the tightening of belts financially for CSU campuses in the wake of the COVID-19 pandemic, Cal Poly Pomona's general fund budget remains balanced.

That was the key message of the virtual Campus Conversation hosted by President Soraya M. Coley on Oct. 25, which included an overview of the current state of the budget, future challenges the university faces regarding enrollment and opportunities for growth. (Watch the video of the presentation here; CPP authentication required).

The Campus Conversation on the Budget started four years ago to share the fiscal position of the university and expanded this year to view the campus' finances in the context of the larger challenges that Cal Poly Pomona and higher education overall is facing, President Coley said.

"It is important that the entire campus - students, faculty and staff - understand the forces changing higher education and the strategies that we are pursuing to ensure that Cal Poly Pomona can continue to thrive," she said.

By the Numbers

Cal Poly Pomona's 2022-23 fiscal year operating budget totals $370 million, with $200.6 million coming from state appropriations, $147.3 million in estimated tuition and $22 million in estimated fees.

State appropriations increased by $22 million over the 2021-22 budget, but the funding is mostly earmarked for required operating costs, including $16.7 million for salaries and benefits, $668,000 for designated programs and $805,000 for the State University Grant, said Carole Lee, assistant vice president of budget planning and analysis.

One-time funding also has been allocated for specific projects including:

• $2.2 million for Graduation Initiative 2025.
• $553,000 for the Student Basic Needs initiative.

Other proposed one-time allocations include:

• $18.75 million for the Huntley College of Agriculture equipment and facilities to support sustainability efforts.
• $2.5 million for the Cal-Bridge program to promote doctoral education in the STEM fields.

Ysabel Trinidad, vice president of administration and finance, said the key takeaway for the 2022-23 budget is that the general fund is balanced with no structural deficit. The CSU increased the campus's funded enrollment target for full-time equivalents (FTEs), or full-time students, by 425, resulting in an additional allocation of $3.8 million. Also, Cal Poly Pomona continues to maintain a three-month reserve required for economic uncertainty.

In alignment with directions from the Chancellor's Office, Cal Poly Pomona decreased its enrollment by 2,388 FTEs, resulting in a loss of $17 million in tuition and fees revenue. The university also funded $3 million in additional compensation costs. Despite this combined $20 million impact, the general fund is balanced.

Despite the reduction, there will be no divisional budget cuts. And, since 46 percent of the budget funding comes from tuition and fees, the campus plans to maintain its 10.5 percent over-enrollment target for 2023-24.

"With enrollment declines potentially continuing, our tuition and fee revenue will continue to shrink," Trinidad said. With a less promising economic outlook for the state, we need to continue our disciplined approach for financial planning to support a fiscally sound foundation to support student success."

Weathering a Storm

Postsecondary college enrollment is declining nationwide, a trend that fiscally impacts Cal Poly Pomona as well.

There are several contributing factors, such as low birth rates, meaning fewer high school graduates; decrease in international students; the impact of COVID-19; and not enough focus on non-traditional students, Coley said.

Southern California is projected to see a 15.6 percent decrease in enrollment by 2032.

"Over the last several decades, it has been relatively well accepted that earning a college degree is worth the investment," Coley said. "In combination with escalating tuition costs and a strong labor market, we now see a rise in prospective students and their families questioning the value proposition of a higher education."

While statistics show an ever-growing wage gap between people with bachelor's degrees and those with only a high school diploma, as well as the fact that college graduates are more likely to have health and retirement benefits, higher education needs to do more to make the argument about the long-time value and return on investment, she added.

The University of California system and California Community Colleges are amping up their efforts to strengthen their applicant pools and transfer pipelines, and it is incumbent on Cal Poly Pomona to do the same, Coley said.

"Because of Cal Poly Pomona's unique assets, we have all the materials and tools within our reach to build shelter from the storm," she said, referring to the trends on the horizon facing higher education. "It doesn't mean we won't get a little wet or feel the chill from the wind.…Yet, when we stay focused and proactive on building the elements of our shelter, we will all share in that refuge and create something new and lasting in service to our students and the community."

CPP Enrollment Trends

Provost and Vice President of Academic Affairs Jennifer Brown said that national and state enrollment trends affect the CSU system. While the struggle to meet enrollment targets has impacted Northern California campuses more, the shortfalls affect the system as a whole.

Most of the over-enrolled campuses are in Southern California, with Cal Poly Pomona the highest of all CSU campuses at 121 percent. The campus was one of three to meet its fall 2022 enrollment targets, generating $25 million in additional tuition and fees as a result, Brown said.

However, the downside to over-enrollment is that the campus does not receive state funding for additional students. For fall 2022, the state contributes 46 percent to the cost of the education, while tuition fees largely make up the balance.

Each year, CPP receives a record number of applications, totaling more than 64,500 prospective undergraduates applying for fall 2022. Even in fall 2020, the campus was 25 percent over its CSU-funded target for FTEs. The increasing demand is not keeping in line with the funding to support such growth, Brown said.

"We collect tuition collars on the campus for this over-enrollment, but we do not receive system funding," she said. "On top of the need for additional courses, excess enrollment places extraordinary stress on campus services. Many campus offices are not sized to support the larger student body, in terms of personnel and processing capacity, and cannot be grown adequately due to the lack of state funding."

The university has seen a slight decline of 14 percent in undergraduate transfer applications and the average load of classes students are taking has slightly declined since the pandemic, averaging 12.81 in fall 2022.

"A new campaign will begin soon to reinforce the importance to taking 30 units per academic year to achieve timely graduation," she said.

New Opportunities

The university plans to launch several efforts to address enrollment trends and funding issues.

One opportunity may be to service the large number of people who have some post-secondary education but no degree, as well as adult learners who want to earn a bachelor's degree, Brown said. The College of Professional and Global Education offers us a chance to help CPP find additional ways to reach non-traditional students, she added.

Among the steps the university has taken to maintain the demand for a CPP education include the inaugural Spring Open House, which yielded more than 8,000 attendees. Cal Poly Pomona also hosted a Fall Preview Day on Nov. 5 for all prospective applicants and their families to promote engagement and application submission.

The university also plans to recruit in new geographic regions, develop pipelines from underrepresented communities, leverage technology, and enhance partnerships as part of its strategic recruitment efforts, Brown said.

Other plans include:

• Expanding philanthropy
• Increasing grant funding
• Continuing to hire more tenure-track faculty
• Promoting scholarships
• Continuing to progress on GI 2025 goals
• Moving forward with diversity, equity and inclusion initiatives

The university also will participate in a new state-funded work-study program that will launch in the 2022-23 academic year. The state will fund the Learning-Aligned Employment Program (LAEP) with $9.7 million over 10 years.

The program will provide students with comparable pay to similar positions in the employing organization; promote equity by giving priority to first-generation college students, current/former foster youth and housing insecure students; align with workforce needs by giving priority to STEM disciplines; and bridge the gap between college and career by ensuring positions are educationally beneficial or related to a particular career interest.

"The intention is to help California's economy recover from the pandemic while addressing long-standing social and economic inequities in higher education and workforce participation," Brown said. "LAEP will be a game-changing opportunity for our students, who so often need employment to support their education and their families."

To be part of the continuing conversation, answer these reflection questions, which were posed at the end of the webinar (CPP authentication required).