Sacramento State President Luke Wood sent out a critical budget update to Sac State faculty Monday addressing concerns around layoffs, potential new student fees and other revenue pathways.
Wood said the cuts are driven by a $375 million budget cut to the California State University system in Governor Gavin Newsom’s 2025-26 budget plan. Combined with inflation and other financial pitfalls, Wood confirmed Sac State will be facing a $37 million budget deficit in the 2025-26 fiscal year, as projected earlier this year.
Wood confirmed that each division of the university will be taking an approximately 22% budget cut over the next year, except for Academic Affairs, which will be taking a smaller cut over the course of two years.
The cuts led to the elimination and merging of 28 positions in management, with 15 employees being terminated. The university did not share which positions were terminated.
Wood said that more positions are at risk of being merged and cut, but did not disclose if those positions were purely administrative or could bleed into faculty.
Wood said there has been consideration to implement a “Student Success Fee” across colleges. This fee, which is proposed by colleges rather than the university as a whole, would help fund essential services such as retention programs and increase available class sections. The update said students will get the chance to vote on this proposal before the end of the semester.
“I understand that it can be difficult to see things like cuts to course sections and position elimination at the same time as growth to other student life programming,” Wood said in the update. “However, it is possible to implement new revenue streams that can directly support Academic Affairs.”
Wood said his advisory committee would be working alongside division leaders to reduce budget allocation. This includes a hiring chill akin to other CSUs, where the university slows down hiring new positions but does not fully stop.
Currently, over 85% of the university budget goes toward employee salaries and benefits. According to the update, that percentage is likely to rise next year.
“Though the cuts at the administrative level will result in significant savings, there are still difficult choices ahead as we work to meet our reduction target,” Wood said in the statement. “Leaders from every division have made incredibly difficult cuts that will likely impact services, but we do not intend to ask anyone to do more with less.”
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According to the update, Sac State is looking into alternatives for revenue, citing the approved fee increases from fall 2024 that are set to take effect in fall 2025. These fees would contribute to programs such as athletics and student health but not the academic budget.
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Sac State said in a statement to The State Hornet that the Student Fee Advisory Committee will meet next week to discuss the Student Success Fee. The statement said students will be notified of potential changes after that meeting.
Despite incoming cuts and budget deficits, Wood said Sac State is still working towards expanding the campus and improving student life. This plan is to be achieved by gradually raising student fees, starting in the fall of 2025.
“We hope that state budget reductions will be restored in the May budget revision, and we know that there will be tough cuts ahead regardless,” Wood said. “I can assure you that these difficult decisions were made with care and with the goal of protecting our core mission of serving students.”
