The Brief

The California State University system will seek a state loan of $144 million that it’ll have a year to repay at no interest, even though current projections show the system will have to add to its deficit to repay the debt.

Cal State’s chief financial officer says the loan will be used to offer one-year bonuses to faculty and staff. While salaries vary widely across the system, the extra $144 million is roughly a 3% increase in the total pay for Cal State’s workers, including executives. State law says the loan needs to be repaid by next July.

Despite months of hesitation, the system today took the first step to request the loan and will likely get the money in 60 days or less, said Cal State’s interim chief financial officer, Patrick Lenz, in an interview. The process involves approval from state lawmakers, who are likely to support the move.

State lawmakers made the loan available to Cal State after they cut state funding to the system by $144 million this year. Cal State has 22 campuses and enrolls 460,000 students.

The system’s largest union, the California Faculty Association of 29,000 workers, is cheering this decision but says more work is needed to bring back lecturers whose contracts were cancelled as many campuses contend with shrinking budgets. The union’s collective bargaining agreement is expiring but negotiators from the union and Cal State leadership haven’t met since April.

“We will take this as a win, but we have so much work to do, and I do hope that this provides an opening for the management to come to the table with us and negotiate fairly,” said Elaine Bernal, a lecturer at the Department of Chemistry and Biochemistry at Cal State Long Beach and senior member of the faculty association.

“The one-time investment, great, but we really got to focus on long-term investment,” she said.
The Legislature intends to increase state spending for Cal State in 2026-27 by just $101 million — far lower than previous promises from Gov. Gavin Newsom of about $250 million — so the system will effectively be $43 million short once it repays the loan, Lenz said. The decision to take the loan came “after careful deliberation, conversations with the chancellor, conversations with our Board of Trustees,” Lenz said.

Money is chronically tight at CSU. Since 2023 the system has battled ongoing deficits that have led to hundreds of degree and course cuts, fewer lecturers and hiring freezes. Back then, the system said it was spending $1.5 billion less than it should to adequately educate its students.

Over the past two years that figure has grown by several hundred million dollars as costs rise for campus utilities, insurance, health benefits and more. The deficits exist even as the system in 2024 began increasing tuition annually; the added costs outweigh the new revenue from charging students more. However, most students don’t pay tuition because of state and system financial aid.

Despite those fiscal pressures and likely new expenses to replace the Trump administration’s cuts to federal education grants, Lenz said system leaders want to spend the money on workers.

Unions wanted loan

The zero-interest loan has been the source of intrigue and scrutiny since July as unions representing Cal State workers have been pressuring the system to agree to borrow the money so campuses can offer pay increases for workers. Unions and some lawmakers argued that the the system was fully funded because the state budget gave CSU the option to borrow the loan, which should trigger collective bargaining contract language that stipulated that ongoing raises would kick in if the system received an increase in state funding.

But Cal State officials say that even if they take the loan, it’s not new or ongoing funding — it’s money they’d have to repay after a year — so the system isn’t obligated to increase wages like those contracts dictate.

Lenz reiterated that point during an interview, even after indicating the system will take out the loan.

“Clearly, anything that is one time is not ongoing,” he said of the loan. So any raise “would be only for the 12 months of the budget year.” But maybe the state will send more cash to the system than what lawmakers and Newsom signaled in the annual budget deal they solidified in June, Lenz said. He also suggested that CSU could negotiate more time to repay the loan.

“There's a long way to go in this process, and there's a lot of unknowns,” he said.

The loan is “an unusual financial strategy”, said Robert Kelchen, a professor of higher education budgets and finance at the University of Tennessee, Knoxville. Asked if this could be a model for other states, Kelchen said it might be for “other blue states that are heavily unionized” and are trying to secure labor peace with labor groups.

“That's really what this feels like,” he said.

How CSU got here

That the loan even exists is itself an example of curious budgeting tactics by lawmakers and Newsom. Last year they passed a state budget that gave Cal State a moderate increase in state funding with a warning of huge cuts of $375 million this July — equal to about 8% of what the state spends supporting the CSU.

After a half-year of fierce advocacy from Cal State officials, students and workers, the final 2025-26 budget approved in June applied just a 3% cut to CSU, with a promise that the cut — $144 million — would be restored in the 2026-27 budget year that begins next July. To help Cal State manage its finances this fiscal year, the state said the system could borrow $144 million this year and repay it by the end of June 2026.

The loan option was extended to multiple state agencies, including the University of California.

System budget leaders, including Lenz, in July expressed wariness over taking out the loan because if the state’s budget picture remains shaky — it’s already projecting billions of dollars in deficits — then lawmakers may decide to apply further cuts to the CSU. That means the system would be in a deeper deficit and be on the hook for a loan they couldn’t repay.

The fiscal malaise could have been worse. In 2022, Newsom promised the CSU and University of California five years of increasing budget support totaling more than $1 billion for each system in new, ongoing funding. But because of state budget constraints, that so-called “compact” has only been partially funded.

And new funding pain points are likely on the horizon. Congressional Republicans and President Donald Trump approved spending plans that Newsom says will kick millions of low-income Californians off public health insurance. If the state plans to pay for that care, budgets for other agencies, especially those that can raise tuition, may need to decrease.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.

Along busy streets in Long Beach’s Washington neighborhood, longtime resident Jesus Esparza says locals will consider just about anything to keep themselves safe from speeding drivers.

The latest idea: leaving reflective vests on the worst street corners so pedestrians can don them while crossing and leave them for the next passerby.

It’s a grassroots tactic that illustrates their frustration with Long Beach’s increasingly deadly streets. In 2025, the city recorded 53 fatal traffic collisions, a sharp increase from 2024 and the most in more than 10 years.

Long Beach has been striving for years to make its roads safer. In 2016, the City Council said it hoped to eliminate traffic deaths and serious injuries by 2026. It was their version of a Vision Zero plan that many municipalities have adopted.

But in the ensuing decade, Esparza, who leads the local neighborhood association, says he’s seen little progress. He’s regularly passed along residents’ requests for traffic-calming measures — things like adding more lighting or delaying green lights so pedestrians get a head start in a crosswalk. But, he said, he’s yet to see any effective measures installed.

“We would always ask for speed bumps or speed tables,” Esparza said in Spanish, “but they don’t put them [on our streets.]”

Despite a rise in deadly crashes, a spokesperson for Long Beach’s Public Works Department, which manages streets, said the city is still confident in its strategy.

Its “core principles” include protecting pedestrians, bicyclists and motorcyclists by slowing down drivers, Public Works spokesperson Jocelin Padilla wrote in an email. Those plans “remain unchanged.”

She said speeding is a primary factor in the city’s most serious crashes. Bad driver behavior, such as impairment and distraction, is also to blame.

Their greatest toll has been on people outside of cars. Last year, 32 people were killed while walking, biking or riding an e-scooter. That eclipses the number of people murdered here last year: 29.

Other residents have also pressed for faster action.

On another dangerous section of roadway along Orange Avenue, resident Kelsey Wise said she’s seen countless near misses. In response, she spent hours putting together a PowerPoint presentation to convince the city to install speed humps on Orange Avenue between Seventh Street and Hellman Avenue.

Wise estimated that roughly half of the drivers on her street travel above the posted 25 mph speed limit — a habit she finds increasingly troubling when teenagers from the nearby school zip through her neighborhood on electric scooters and e-bikes.

Last month, Wise presented the information to Councilmember Mary Zendejas’ office, who told her they would refer the presentation to Public Works. She’s yet to hear anything back.

“I think the system right now is designed to respond once something catastrophic happens, not when residents are signaling that something catastrophic is likely to happen,” Wise said.

Public Works told the Long Beach Post that seemingly simple fixes like the speed bumps Esparza and Wise asked for aren’t feasible. Its engineers prefer other “traffic calming treatments.” Speed humps slow down emergency response vehicles and the department has received “objections to noise” caused by drivers hitting them, Padilla wrote in an email.

Padilla said they instead favor “bulb outs” that extend curbs into the street at a crosswalk and “diverters” — islands that separate bicyclists from regular traffic and prevent cars from turning into neighborhoods or where it’s unsafe.

Over the past few years, the city has “made meaningful investments” to redesign major corridors with those principles in mind, Padilla wrote. Last May, Long Beach celebrated the completion of a $44.2 million project that installed protected bike lanes, new crosswalks and other traffic safety features on Artesia Boulevard.

On Tuesday, the City Council voted to approve reducing speed limits on dozens of streets.

Kurt Canfield, an organizer with local street safety group Car-Lite LB, said he was skeptical that speed limit reductions would slow down drivers unless it ramps up enforcement. Cops have been writing fewer speeding tickets since the pandemic.

The city has pivoted to relying on automated enforcement. Officials plan to install speed cameras at 18 locations throughout the city, but they’re not scheduled to be installed until the summer. They’ll then start issuing warnings to drivers until fines begin in the fall.

Canfield said he hopes last year’s high death toll will be an outlier.

“I think people are wanting to get back out and bike and walk, but as more people start doing that, now we have what essentially amounts to more targets to be victimized,” Canfield said.

The high death toll, he said, doesn’t mean the city’s approach is wrong, Canfield said.

“It just means that we need to try more, we need to continue building safer streets and changing behaviors because it does work,” he said.

It was short lived, but the wintry spell that graced Southern California is leaving the area. We're in for dry, sunnier weather this weekend and warmer weather early next week.

Today's highs will again be mostly in the mid-60s along the coast, topping out around 67 degrees in the valleys and Inland Empire.

Coachella Valley will see highs from 67 to 72 degrees. Meanwhile, in the Antelope Valley, cooler conditions will continue with highs from 54 to 64 degrees.

This weekend will be fairly windy across SoCal starting Saturday evening. The National Weather Service forecasts winds from 15 to 25 mph across L.A. County mountains and hills. Come Sunday, winds will be strongest in Inland Empire and inland Orange County, where gusts could range from 30 to 40 mph.

The Los Angeles City Council has approved plans to hire more police officers this year, ending a months-long struggle over the city budget with the mayor's office.

The vote this week will allow LAPD to hire 410 officers, up from the 240 included in the city's original budget for this fiscal year.

L.A. Mayor Karen Bass had pushed for the additional hires, citing the coming World Cup and Olympic Games, while some councilmembers questioned where the money would come from.

In December, the City Council voted to allow for an additional 40 officers to be added to the force, using the city's general fund.

This week's vote got Bass the rest of the way there. It will bring LAPD's ranks to around 8,500 sworn officers. At its height in 2009, the police force had more than 10,000.

It's a victory for Bass' office, but she said in a statement that hiring still is not keeping up with attrition.

"Although this is an important step, there is more work to do to invest in the safety of Angelenos,” Bass said.

The council approved the additional hires only after City Administrative Officer Matthew Szabo found that the funds could come from the police department rather than the city's general fund.

In a report submitted to the council last week, Szabo identified around $3 million in funds from LAPD savings and a projected surplus in an account used to pay officers their accumulated overtime when they retire.

Councilmember Monica Rodriguez called the move "robbing Peter to pay Paul." Councilmember Tim McOsker called it "robbing Peter to pay Peter." They both supported the motion.

But the funds identified by the city administrative officer will only cover the new hires this fiscal year. In his report, Szabo estimated that adding 170 more recruits to LAPD and resources in the personnel department to support them would cost around $25 million in the next fiscal year. He suggested his office could identify potential police department budget reductions or general fund revenues in next year's budget cycle to continue funding the new officers.

Councilmember Katy Yaroslavsky, who heads the budget and finance committee, voted for the plan to add new hires. She said Wednesday that most councilmembers were supportive of increasing the ranks of sworn officers but expressed dissatisfaction with the process that led to this move.

"I would have preferred that this issue of these additional officers that weren't in the budget that was adopted and signed by the mayor was addressed in the next budget," Yaroslavsky said. "But that being said, here we are."

Councilmember Hugo Soto-Martinez was not convinced. He told the council he thought the ongoing cost of additional hires likely would lead to cuts elsewhere.

"A budget is a document of our priorities," Soto-Martinez said. "And it just feels like every single time, LAPD gets what they want. Every single time. And the conversations that are not happening in the public is about how that affects other things that the city does."

He voted against the extra hires, along with councilmembers Eunisses Hernandez, Ysabel Jurado and Nithya Raman.

Soto-Martinez, who sits on the public safety committee, also said he wanted more transparency on police spending on costs like overtime. He said every quarter the city spends $50 million on police overtime.

Soto-Martinez and Raman introduced a motion instructing the city administrative officer and legislative analyst to transfer some LAPD auditing and accounting into a new bureau of police oversight within the city controller's office. That motion was referred to the personnel and hiring committee.

Police Chief Jim McDonnell pushed back against that idea Wednesday, saying it would take additional personnel away from the department.

"We're working on a skeleton crew," he said. "We're two years out from the Olympics, five months out from the World Cup, and we've got a deficit [of officers]."

The vote came after LAPD requested nearly $100 million in its proposed budget for next fiscal year for new vehicles and equipment to police the Olympic Games.

Spending in Orange County decreased by about 25% after immigration enforcement ramped up last summer, according to a study by UC Irvine’s Social Impact Hub.

Study authors also analyzed data from the California Department of Tax and Fee Administration to find Orange County saw economic output drop by $58.9 million over an eight-week period last year, coinciding with ramped up ICE enforcement, leading to $4.5 million less in sales tax.

“ I wish I could say I was surprised or shocked. I'm really not,” said O.C. Supervisor Vicente Sarmiento, whose office partnered with the study authors to create and distribute the study survey among business communities. “I think what the results and findings showed was that we can quantify the impact that all of us logically believe is occurring.”

Sarmiento added that the results show it’s not just the labor supply, where industries like construction and hospitality are heavily reliant on immigrants, that is affected by immigration raids.

“ We also are seeing that there is a demand side that is affecting our economy, meaning that there are countless consumers from the immigrant and undocumented population that have significant purchasing power,” he said.

After President Donald Trump promised to carry out the “largest deportation operation” in U.S. history, Southern California became the epicenter, with federal agents carrying out raids across the region, including in Orange County. And they haven’t taken their foot off the gas, causing prolonged periods of fear and uncertainty for businesses that can be difficult to sustain, Sarmiento said.

“Small businesses, especially ones that don't have reserves and don't have excess funds on hand to be able to sustain themselves, will probably end up failing and will probably end up closing down,” he said.

Small-business owner weighs in

LAist checked in again with Alejandra Vargas. She runs a small boutique selling clothing and knick-knacks on Fourth Street in Santa Ana. In June, she said she lost around 80% of her walk-in customers.

Those numbers are still bleak.

“ Where we're at on Fourth Street, it's still empty. There's no people still,” she said.

Vargas has since had to pivot her business model. When the raids started, she began hosting paint-and-sip events for the community to decompress and create art, which brought in more customers. Her next one is right in time for Valentine’s Day, where people will listen to funk music and paint figurines.

She has also tried her hand at online sales.

But because of the ongoing ICE sweeps, people remain hesitant to spend money. And it’s also “nerve wrecking,” Vargas said, because she’s visibly a Latina.

“ I'd rather put up a fight than do nothing,” she said.

Preying on the vulnerable

Sarminento also said his office has seen an uptick in calls from people falling victim to scams. Undocumented workers are being exploited by employers withholding wages. And he said there are phony businesses popping up preying on vulnerable, scared immigrants looking to find legal help.

 ”We've been in contact with the district attorney's office to look into that,” he said.