LONG BEACH – California State University leaders on Tuesday recommended approving a $4.5 billion budget that tentatively holds student fees steady, provided the Legislature comes through with enough money.

Trustees also voted to prune executive perks that had been criticized as too lavish.

On the budget prospects, Chancellor Charles B. Reed told the board much depends on the economy, but said he’s optimistic Gov. Arnold Schwarzenegger will recommend providing enough money to avoid a fee increase.

“The governor has indicated strong support. He really gets it about economic development and higher education, so that connection is really there and we appreciate that,” he said.

The governor’s preliminary recommendations come out in January, and lawmakers have until June 30 to pass a final budget.

Meanwhile, a trustees’ committee approved reforms to CSU’s executive pay program, which includes a year’s salary to departing leaders. The program came under fire after the San Francisco Chronicle reported that as much as $4 million had been paid out over 10 years, a period in which student fees increased significantly.

In most cases, executives were working on special projects, but at least two were paid after taking jobs out of state.

On Tuesday, the committee voted to limit the program to people who have been system executives for at least five years. They would be required to perform work and would have to identify a CSU job to which they plan to return; executives who simply retire or take jobs elsewhere would not be eligible.

Agreements, to be negotiated by the chancellor, also must be discussed by trustees in open session.

Roberta Achtenberg, chair of the board, said the revisions “enhance the transparency of CSU’s operations, as well as increase communication to the public.”

The changes take effect for people hired after Wednesday, when the full board was expected to ratify the vote. Reed, his four top deputies and 17 of CSU’s 23 campus presidents are exempted from the new rules, although board members indicated they would seek voluntary compliance through negotiation.

Some said the reforms didn’t go far enough.

John Travis, president of the California Faculty Association, said the revised program is too open-ended with no time or dollar limits. Beyond that, he said, “there needs to be a justification for the program to begin with, an explanation for why such a program is needed.”

Hundreds of faculty members, whose contract negotiations currently are in third-party mediation, planned to rally outside the trustees’ meeting Wednesday, calling for the end of executive perks, a rollback of student fees and a better deal at the bargaining table.

The budget approved by committee Tuesday includes $3 billion from the state general fund and $1.2 billion from fee revenues. It was expected to be approved by the full board Wednesday.

Under a previous agreement with the governor, the budget is set to increase 4 percent next year, with $64.2 million funding enrollment growth of 2.5 percent – or 11,000 students – and $65.2 million to avoid hiking student fees 10 percent.

Under that scenario, undergraduates will pay an average $3,199 a year, including systemwide and campus fees.

In addition, CSU trustees are asking for 1 percent more than the funding agreement – about $122 million – mostly for research and other academic programs.

CSU is the nation’s largest four-year public institution, with more than 400,000 students.