Cal State is saving its smallest campus by merging it with Cal Poly
CalMatters
In a bid to forestall its financial disintegration, Cal Maritime, California’s smallest public university, is merging with one of the state’s most selective and financially stable universities, Cal Poly San Luis Obispo. It’s a move that’ll conjoin a Bay Area campus that trains students for a life at sea to a school 250 miles away that’s known for agriculture and engineering. California State University senior officials in the chancellor’s office painted a stark picture in its report to the board of trustees that collectively oversees the whole system. There “continues to be a dire, binary choice: integrate the two institutions or initiate immediate steps for the closure of the Maritime Academy,” board documents said. The top executives at Cal Poly and Cal Maritime support the merger. The trustee committee signed off on the plan, and the full board voted unanimously on Thursday to approve the merger. As a consequence, the system of 23 universities will downsize to 22. The state’s Lt. Gov, Eleni Kounalakis, a trustee member, said “this is, without question, the most exciting thing that has happened” in her six years of serving on the board. The consolidation is “going to elevate both of these campuses.”
Fueling Cal Maritime’s fiscal misfortune is a collapse in enrollment and the tuition dollars that flow from it: Since 2016-17, Cal Maritime shed 31% of its students, dropping from 1,107 to 761 last fall. Cal Poly’s enrollment in the same period has held steady at around 22,000 students. The chancellor’s office estimates that to keep Cal Maritime operating at its present reduced size, it’ll need about $30 million annually — on top of its current $52.3 million annual budget. Expanding the campus’ enrollment as a standalone campus would add to the costs, as would the needed financial aid, said Steve Relyea, the system’s chief financial officer, at the September hearing. In an interview, Relyea explained that likely 80% of that $30 million would have gone toward salary and benefits for a Cal Maritime campus that cannot afford it. But that new money won’t be necessary with the merger. Because Cal Poly is large enough, its personnel can absorb much of the workload needed to sustain Cal Maritime after the merger. Relyea is also confident that Cal Poly’s infusion of cash and personnel can grow Cal Maritime’s enrollment. That will boost revenues for the combined university over time to afford any additional staff the merger requires, plus increased financial aid and student academic support. The merger should also lead to more contracts and construction projects at Cal Maritime that have fallen through the cracks, Relyea added. Dealing with maintenance issues sooner prevents more costly repairs later.
To ease the transition to Cal Poly’s higher expenses, officials at Cal State chancellor’s office are saying the system needs to spend $5 million annually for the next seven years — and a majority of that will be for financial aid. Relyea said in September the system doesn’t expect the need for higher ongoing funding for the merged university after that seven-year period above what they spend now.
Cal State’s chancellor’s office hired a firm specializing in campus mergers, Baker Tilly, at a cost of nearly $2 million, Cal State’s spokesperson, Amy Bentley-Smith, wrote to CalMatters. The firm will work on this merger for the next 10 months.
If the merger goes through, the Cal Maritime campus will become a subsidiary of Cal Poly starting July 1, 2025. Cal Maritime’s land-based academic presence will be called Cal Poly, Solano Campus; its training vessel, the academics for the Merchant Marine license issued by the U.S. Coast Guard and related disciplines will be called Cal Poly Maritime Academy. Leaders of the two subsidiary campuses will report to the president of Cal Poly, Jeffrey Armstrong.
Starting fall 2026, all students of the merged institutions will be enrolled as Cal Poly students, actions that also require outside approval from education accreditors.
Cal Maritime’s national implications
But it’s not saving money that’s the core driver of collapsing Cal Maritime into Cal Poly, Relyea said. Rather, it’s to preserve Cal State’s ability to offer degree programs that lead to Merchant Marine licenses issued by the U.S. Coast Guard, he and other system leaders said, including Cal Maritime’s interim president, Michael Dumont.
Merchant Marines are the officers who lead commercial ships for international trade during peacetime and move U.S. military supplies around the globe. “Without the civilian mariners who operate these ships, the United States’ ability to project military power would suffer and the nation’s national security interests would be compromised,” Cal State officials wrote in July.
Cal Maritime is one of seven maritime academies in the U.S., including the federally run United States Merchant Marine Academy. The other six state-based academies have a federal mandate to educate future Merchant Marines. Like Cal Maritime, all the state-based academies have seen enrollments plummet for their Merchant Marine programs. Cal Maritime is the only such academy on the west coast and attracts students not just from California but from other Western states as well.
At Cal Maritime, training includes summer apprenticeships and a semester out at sea on a large training vessel. The federal government is spending $360 million to provide Cal Maritime a new ship by 2026. Without more students, it “would be cost prohibitive” to operate those hands-on experiences, Relyea told trustees in September. To save on costs, Cal Maritime froze hiring in March, leaving 17 vacancies unfilled and eliminating 14 positions. Dumont also eliminated 10 vice president and associate vice president positions based on his assessment that Cal Maritime “was overly administered given its enrollment decline and relatively small size,” he said in September.
For Julia Lopez, a trustee on the board who co-led a working group on Cal State’s finances, this merger “will have bent the cost curve for the system, because Maritime will no longer cost us as much as we would if we kept it ongoing,” she said in September.
The combined campuses “will have grown, added enrollment, saved a precious and important and valuable campus, and done it with resources that we would have been spending anyway,” she said then.
Another trustee, Jack McGrory, said in September that this merger can be a model for Cal State’s future efforts to cut costs as the system battles ongoing budget gaps. Relyea, in an interview, echoed that sentiment. A campus with dwindling enrollment can hire, for example, the human relations or contracts division of a more financially stable campus at a fee that’s less than what it would cost to hire or retain those workers. “Some of our campuses are just not going to have the resources to do it anymore,” Relyea said.
But the union representing faculty has faulted the system for providing scant details about the merger.
“The restructuring will undoubtedly impact faculty jobs, workload concerns, result in potential layoffs, curb professional development, and program quality,” a statement from union leadership said this week.
Lisa Kawamura, a professor at Cal Poly and chair of the faculty union chapter there, told CalMatters that faculty still doesn’t know whether the merger will mean lectures at Cal Poly will lose their jobs to tenured professors at Cal Maritime. They also don’t know if professors will be expected to teach more students per class or if professors will be paid higher wages if they’re asked to teach year-round, one of the plans Cal Poly leadership is floating. Another strain on the faculty is that Cal Poly is transitioning away from a quarter system to a semester one for its academics by 2026, a conversion that’s rife with complexity in normal times but is accentuated by the merger.
Another trustee, Darlene Yee-Melichar, who’s the faculty representative on the board, sounded less critical: “I’m very optimistic and supportive of the proposed integration,” she said.
Merger impact on student costs
Currently enrolled Cal Maritime students will not be charged more for Cal Poly’s campus fees, which are considerably higher than those at any other campus in the system. That’s on top of systemwide mandatory tuition that all students must pay. Instead, Cal Poly will “offset and cover the difference in fees for all continuing Maritime students as they complete their degrees,” Armstrong said in September. Cal Poly recently passed a fee structure that preserves 60% of new fee revenue for student financial aid and scholarships. Still, Cal Poly enrolls the smallest share of low-income students of any public university in California, as measured by the federal Pell grant that’s limited to students from low-income households. That’s because the state’s main free tuition program covers systemwide tuition, but not campus fees. That plus the expensive rent in San Luis Obispo make Cal Poly less affordable for low-income students than other public universities in California, including the University of California. Cal Poly’s total tuition and fees are $2,600 more than Cal Maritime’s this year — and about $4,000 more than the systemwide average, a CalMatters review of system data shows.
Cal Poly students earn $20,000 more on average within two years of graduating than the system’s average of $56,000. Cal Maritime students earn nearly $40,000 more than the system’s average.
Student and faculty reaction
Gary Saunders, an international strategy and security sophomore at Cal Maritime, says the merger will not change much for him. He believes his return on investment will remain high no matter the outcome of the merger.
“You’re almost guaranteed a really high-paying job directly out of college,” Saunders said. “You’ll still be getting the same job offers, so I don’t think (the merger) changes much.”
Saunders says some of the students who are invested in the campus’ traditions may be more reluctant but believes his school could use a new direction. The campus has already made uniforms for non-cadets optional, and Saunders thinks this shift will make the campus more like Cal Poly.
He hopes to see more support toward organizations that create an inclusive campus if the merger provides the Cal Maritime campus more financial and institutional resources for cultural clubs.
“I’m a Korean guy,” Saunders said. “I come from a super poor family. With more resources, I hope to promote diversity and make sure bad stuff from the past won’t happen again.”
Cal Maritime and Cal Poly have worked to increase diversity by partnering with local high schools and community colleges, according to a Cal State overview of the merger. The campuses will both have access to Cal Maritime’s Title IX team that investigates sexual harassment claims and Cal Poly’s Civil Rights and Compliance Office will develop a joint civil rights implementation plan.
In San Luis Obispo, many students seem to be unaware of the possible change, says Cal Poly biomedical engineering senior Hannah Reyes. She believes students will not be very affected by the merger.
“It sounds like a big deal, but Cal Maritime only has about 800 students,” Reyes said.
Trevor Knotts, an industrial engineering sophomore at Cal Poly, also believes the merger with Cal Maritime could offer Cal Poly students a unique educational experience with access to Maritime’s programs.
“With regards to the College of Engineering, I think it’s exciting,” Knotts said. “I know Cal Maritime is a super small school and only has three engineering majors. They offer new aspects of the college experience and a good way to get these more niche career paths exposure.”
At the September trustees meeting, Armstrong said the two schools have similar academic focuses. “Most of the programs leading to a U.S. Coast Guard Merchant Marine officer license are engineering related,” he said of Cal Maritime’s offerings.
Once the merger occurs, some advisory bodies from the two campuses will also merge into one body, like the Academic Senate, which represents the interests of professors on educational matters. Cal Poly’s Academic Senate Chair Jerusha Greenwood has been in conversation with Cal Maritime’s chair, Sarah Senk, about what the merger might look like.
“A lot of it has actually been learning about each other, what each Senate looks like,” she said. “Because it will be one Cal Poly institution with two locations, how does our constitution for Academic Senate need to be updated?”
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This story was originally published by CalMatters and distributed through a partnership with The Associated Press.
