Revised CA Budget Commits to Higher Education Amid Economic Uncertainty, Requires Action to Maximize Investments Through Statewide Coordination
On May 14, 2025, Governor Gavin Newsom unveiled his updated state budget, proposing $45.7B for higher education, a slight increase from $45.1B in the January budget proposal. Despite a worsened financial outlook and national economic volatility, the Campaign for College Opportunity thanks Governor Newsom for working to maintain the promise of higher education by reducing proposed budget cuts to the California State University (CSU) and University of California (UC) from 8% in January to now a revised 3%, and for maintaining investments at the California Community Colleges and within our state’s higher education financial aid programs. While this news is encouraging, we call on state and education leaders to remain committed to higher education—which has helped platform California as the fourth-largest economy globally—as a catalyst for racial/ethnic and economic justice and economic mobility. It is imperative that we meet the needs of historically underserved Latinx, Black, Asian American, NHPI, AIAN, low-income, first-gen, and undocumented students in this uncertain moment. We must prioritize and protect the vital programs and policies across our public systems of higher education that support this growing majority of students to access college and succeed, who today comprise two-thirds of California’s undergraduate student population and whose talents will power our resilience through economic uncertainty.
The Campaign is encouraged by Governor Newsom’s commitment to the multi-year funding Compacts with the UC and CSU, despite having to defer funding for 2025-26 of $240.8 million and $252.3 million, respectively, to 2027-28. This promise represents California’s continued investment in our public universities based on their progress to close stubborn equity gaps and improve student access and success. We call on the state legislature to ensure this deferral, representing a 5% increase in funding to the UC and CSU, is maintained in the Governor’s final budget bill so that all Californians can continue to build on the promise of college in our state. Alongside this ask, we request the legislature continue to hold the UC and the CSU accountable for meeting the goals outlined through this Compact funding, including closing equity gaps in graduation rates, affordability, transfer, and enrollment for our most minoritized students.
The May revision also maintains fiscal stability at the California Community Colleges (CCC), with proposed funding for 2025-26 remaining similar to funding for the current budget year. We are pleased to see that the Governor seeks to sustain investments in our community colleges, especially as it pertains to ensuring that all CCCs can meet the demand for growing student enrollment at their campuses. We call on the state legislature to maintain these investments in the final budget bill to best support the nation’s largest higher education system amid a challenging budget year.
Additionally, the May revision includes a continued commitment to college affordability for California students through our state’s postsecondary financial aid programs. We are encouraged by the Governor’s proposal to significantly increase funding for the Cal Grant program by $228.7 million to meet the growing number of students who are eligible for Cal Grant aid and are looking to achieve their college dreams. We urge the legislature to maintain these proposed state financial aid investments in the final budget bill and allocate one-time resources for emergency aid to California students from mixed-status families and of undocumented backgrounds to ensure that our most minoritized students can meet their college affordability needs amid a shifting federal landscape, putting their college dreams in jeopardy.
Sustaining Progress on Higher Education at Large Through Coordination and Inclusion
In light of a difficult budget year and a rapidly shifting national economy, we must maximize every dollar invested in our state’s public systems of higher education to help every Californian obtain economic mobility and prosperity. Creating a dedicated venue to ensure current state investments across higher education, K-12 education, and workforce systems is imperative to ensure California maximizes every penny. As the legislature considers multiple legislative proposals to remedy this critical gap in coordination –including AB 95 by Assemblymember Mike Fong–we urge policymakers to prioritize the creation of an empowered, accountable coordinating body in the coming months The California Education Interagency Council will bring education and workforce system leaders together to develop statewide education and workforce goals that will continue to propel California and its constituents towards well-paying and sustainable careers.
In a similar vein, we call on the Governor and legislature to continue forward momentum on current investments in student transfer and success by including a one-time, $750,000 investment for a continued third-party facilitator for the Associate Degree for Transfer (ADT) Intersegmental Implementation Committee.
The Governor’s AB 928 ADT Intersegmental Committee advances over 10 years of transfer transformation in the state and is the only venue that convenes higher education stakeholders, including students, to do so. The proposed, one-time investment would power the committee’s ability to further transfer student success and help California reach a streamlined path to a four-year degree for all students.
Additionally, California celebrated establishing a first-of-its-kind Black-Serving Institution (BSI) designation last year. We ask the Governor and legislature to maintain progress for and strengthen the state’s commitment to our Black students by inaugurating the BSI designation with a down payment for community colleges that have proven successful in implementing evidence-based practices advancing Black student success. Only through these investments can California continue its commitment to the two-thirds of California undergraduate students whose talent will continue to power our state’s economy and democracy.
Now more than ever, California is responsible for ensuring its people are afforded the educational and economic opportunities that will lead to a prosperous future. We cannot do this without dedicated state investments in our higher education systems that intentionally sustain progress for our most minoritized students. We look forward to working with the Governor and legislature to ensure that these proposed investments become a reality so that we can guarantee the prosperity of our most vulnerable students and the generations to come.