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California state legislators agreed on a $297.9 billion spending plan for 2024–25 that includes cuts for the University of California and California State University systems’ budgets but spares funding for California Community Colleges.
Lawmakers have also safeguarded funding for the Middle-Class Scholarship for the next year.
The bill attempts to plug a $47 billion deficit in the state budget, which funds the fifth-largest economy in the world.
The deal includes a 5 percent increase for UC and CSU as part of multiyear compact agreements, equating to $258.8 million and $240.2 million in funding, respectively. However, a one-time unallocated base reduction of $125 million for UC and $75 million for CSU will result in an overall lower net funding increase of $133.8 million for the UC system and $165 million for CSU institutions.
Both UC and CSU will also receive a 7.95 percent reduction in their operational funding beginning in 2025–26 as part of a statewide cut to nearly all departmental budgets.
Legislators have also restructured funding increases under compact agreements for both systems, deferring increases for 2025–26 to 2026–27 and 2026–27 increases to 2027–28.
Mildred García, CSU chancellor, said she appreciates the net increase in funding while the state faces a severe deficit, but, she said, CSU’s fiscal challenges persist.
“We face a funding gap of approximately $200 million entering year 2024–25. Additional cuts and deferrals intended for the CSU budget in the following two years would exacerbate our significant fiscal challenges and further complicate the already difficult cost-savings measures our 23 universities are currently undertaking,” she said in a statement.
State lawmakers restored $637 million in funding for the Middle-Class Scholarship program, which provides financial aid for undergraduate degree programs at UC, CSU and California Community Colleges institutions. However, the 2025–26 budget will include a $110 million ongoing reduction.
The new plan protects CCC funding by maintaining $115.3 billion in Proposition 98 obligations for pre-K–12 and community colleges. It also provides $20 million in one-time general funding assistance for community college financial aid offices to support students who are still trying to complete their Free Application for Federal Student Aid.
