California’s Proposed Budget Favors Community College and Career Education While Universities Face Cuts
Credit: Gary Coronado / Contributor / Los Angeles Times / Getty Images- For the first time in two years, California Gov. Gavin Newsom released his proposed state budget without a looming deficit.
- The University of California and the California State University systems could see up to an 8% budget decrease and would have planned budget increases deferred until 2027-2028.
- The plan also includes $100 million in investments in career education and over $300 million for technology upgrades for California Community Colleges.
California Gov. Gavin Newsom released his proposed 2025-2026 fiscal year budget, with around $45 billion in state funding for the state’s higher education systems, including new investments in Credit for Prior Learning initiatives and technology upgrades across California Community Colleges.
The governor’s $322 billion budget includes ongoing funds for the University of California (UC), the California State University (CSU), and California Community Colleges systems, as well as support for the Student Aid Commission, which manages programs including Cal Grant.
The most recent budget proposal is the first in two years that does not have a deficit. Last year, the state deferred funding increases for UC and the CSU and warned the university systems to plan for an ongoing base reduction of nearly 8%.
Newsom attributed the budget bounce-back to the better-than-expected economy, stock market, and cash receipts. However, he warned that the new presidential administration could bring changes in the state’s fiscal position between now and the May budget revision following negotiations between the governor’s office and state legislature..
“In the months ahead, California is facing a new federal administration that has expressed unreserved and uninformed hostility toward Californians, threatening the funding of essential services for political stunts,” he said in a statement.
“Continued global instability and the prospect of another downturn in the financial markets, as well as additional pressure on state expenditures, are warning signs to remain vigilant and prudent.”
UC and CSU Face Budget Cuts, Funding Delays
The proposed budget includes the cuts foreshadowed in last year’s budget, with UC and the CSU expected to plan for a nearly 8% decrease in ongoing support beginning in 2025-2026, which amounts to around $397 million and $375 million, respectively.
The plan would also defer planned 5% base increases in funding for both university systems until 2027-2028.
Newsom first proposed these funding increases for UC and the CSU in the 2022-2023 budget plan, pledging annual 5% base funding increases given the systems work toward certain shared goals, including:
- Making college more affordable
- Increasing enrollment of California residents
- Improving graduation rates
Additionally, the latest budget proposal would delay $31 million in funds to UC to compensate for the funding loss resulting from replacing nonresident students with resident students at UC’s Berkeley, Los Angeles, and San Diego campuses until the 2027-28 budget year.
In a statement, UC President Michael Drake said he was “concerned” about the budget reduction, given the “record numbers” of California students UC is enrolling.
CSU Chancellor Mildred García echoed Drake, saying that she was “disappointed” that the governor had not reversed the planned funding cut given the state was out of a deficit.
“The impact of such deep funding cuts will have significant real-world consequences, both in and out of the classroom,” she said in a statement. “Larger class sizes, fewer course offerings and a reduced workforce will hinder students’ ability to graduate on time and weaken California’s ability to meet its increasing demands for a diverse and highly educated workforce.
“Communities that thrive on the CSU’s investments in student learning, service, and local partnerships will struggle if the university system’s resources are diminished.”
Community Colleges Would See New Investments, Upgrades
California Community Colleges would receive $100 million in one-time funding to implement Newsom’s “Master Plan for Career Education,” which includes expanding Credit for Prior Learning opportunities and developing a “career passport” — a digital tool for employers to access verified records of an individual’s academic and professional skills and abilities.
The proposed budget also allocates $168 million in one-time funding to upgrade data collection across the community college system and $162.5 million to create a common cloud data platform across the whole system.
California Community Colleges Chancellor Sonya Christian thanked Newsom for the planned funding for the system, specifically calling out the investments in data technology upgrades and credit for prior learning.
“By focusing on fiscal stability and career-oriented investments, Gov. Newsom’s proposed budget charts a course to lift low-wage workers into living-wage jobs, a core focus of the California Community Colleges’ Vision 2030,” she said.
“The governor’s proposed budget prioritizes unlocking the income potential of California’s students and working learners in alignment with the Master Plan for Career Education.”