The CSU Board of Trustees voted unanimously to pass a $9.1 billion operating budget for the 2026-2027 fiscal year on Wednesday, marking a 7% increase compared to the $8.5 billion budget for 2025-2026.
The CSU operating budget is responsible for funding day-to-day academic, administrative and operational needs of the system’s 22 campuses and the Office of the Chancellor. The newly passed budget’s expenditure framework is centered around the four goals of CSU Forward, a systemwide, comprehensive strategic plan focused on economic mobility and social transformation.
The proposed budget comes ahead of federal funding concerns, including changes to Pell Grant financial aid and threats to dedicated funding for CSU research.
The approved budget includes $618 million in new spending, balanced by increases in the state general fund and increased tuition revenue. In alignment with the first goal of CSU Forward, economic mobility, $82 million has been allocated to that goal, including $67 million towards enrollment, $10 million towards “innovative academic programs” and $5 million towards degree development for Bachelor of Education programs.
Efforts towards sustainable affordability, the second goal of the strategic plan, received $151 million in new funding, including a state university grant for a tuition increase, which accounts for $64 million and a state university grant for enrollment increase that accounts for $10 million of the funding.
Additional new expenditures for this goal include data and infrastructure funding, premium costs for liability and property insurance, non-personnel inflation costs and state digital software tax.
The Employer of Choice goal, which aims to establish the CSU system as a premier destination for education professionals, was given $313 million in new funding, comprised of $232 million for a faculty and staff compensation pool and $81 million for health premium costs.
The final goal of the strategic plan, focused on statewide impact, was allocated $72 million in new spending. Support for debt services on systemwide bonds dedicated to modernizing and expanding capacity on CSU campuses was granted $50 million, while maintenance costs for new facilities were allocated $22 million.
“Investing in our facilities is ultimately an investment in our students,” said Mark Martin, assistant vice chancellor of Budget Planning and Advocacy for the CSU during the budget presentation. “Safe, modern campuses are essential to delivering high-quality instruction, supporting research and innovation and meeting California’s workforce and economic development needs.”
In addition to supporting facility project debt service, the new operating budget seeks to establish a multi-year partnership between the CSU and the state to effectively address deferred maintenance and capital outlay costs.
Through this partnership, recommended by the legislative analyst’s office, the CSU would request that the state commit $407 million annually for three years — the amount the deferred maintenance would cost if no action is taken. The CSU would match the state support through operational funding.
The combined investment from this partnership is projected to be about $3.3 billion, and would support approximately 100 deferred maintenance projects and 12 major academic projects.
Martin stated that the consequences of systemwide underfunding include reduced progress toward closing student equity, reduced capacity for student support and delays in academic modernization.
During comments from the board on this item, board of trustees member Julia Lopez emphasized the importance of ensuring adequate systemwide funding for CSU campuses.
“It’s easy to look at numbers and forget that they really represent probably the most important statement we have as to our values,” Lopez said. “We value our employees, we value our students, we need to live within our resources and we need to position ourselves for a changing future.”
The approved budget proposal will now be sent to the Department of Finance and Legislature and gubernatorial candidates.