THE STATE

Budget Pain Will Widen if College Fees Are Hiked

The state's middle class may feel the pinch soon as UC and Cal State consider hefty increases.

By Jeffrey L. Rabin and Rebecca Trounson
Times Staff Writers

July 15, 2003

California's budget crisis reaches the state's broad middle class this week, when governing boards of the University of California and the California State University systems are expected to approve fee increases for 600,000 students.

Those increases could mark the leading edge of a wave of impact on the state's higher education systems. California officials say that if the deadlock that has prevented passage of a state budget continues much longer, they could be forced to temporarily stop payment of Cal Grant scholarships to 220,000 low- and middle-income students.

On Wednesday, the UC Board of Regents will vote on a recommendation by university officials, who argue that without raising fees substantially, they will be forced to make deep cuts in administration, libraries, research, outreach and student services. Under the proposal that the regents are considering, the cost for a California resident to attend the university as an undergraduate would jump by as much as $1,150, which would bring systemwide fees to $4,984 a year.

And if Cal State trustees agree, the basic fees charged to residents to attend undergraduate classes at a state university would jump by $474 to $2,046 a year.

Until now, the impact of California's budget troubles has been largely confined to the poor — those on welfare or Medi-Cal, where benefits are slated for reductions — who lack the political clout to effectively pressure Sacramento. But dramatic increases in the cost of attending the state's public colleges and universities could strike a nerve with students and their parents, many of whom vote and know how to apply political pressure to Gov. Gray Davis and state legislators.

Bill Whalen, a research fellow at the Hoover Institution at Stanford University who worked as an advisor to former Gov. Pete Wilson, said increasing UC fees cuts across party lines, status and income lines. "It's a good example of shared pain," he said, one that can affect college students from East Los Angeles to Palo Alto.

"Californians care about the quality of their schools, their roads and the safety of their neighborhoods," he said. "When you start talking about jerking up the cost of college, that matters to people."

Moreover, the fee increases and scholarship troubles represent the beginning of what could be a long summer unless state legislators can adopt a budget. Some vendors are already missing payments, and Davis has warned that some transportation contractors could begin working without compensation as early as next week. In coming weeks, child-care centers, community colleges and schools could lose money as the budget crisis touches each of them.

It was Davis who recommended the increase in UC and Cal State fees when he released his proposed 2003-04 budget in January. Since then, students at both systems of higher education have seen their fees rise once. Now they face another round of increases. And deeper cuts in state funding for higher education could mean an even larger boost in student fees.

Matthew Kaczmarek, a fifth-year student at UCLA and chairman of the systemwide UC Student Assn.'s "No Fee Increase" campaign, said the increases will hit students hard. "We understand the concerns on the state budget right now but we also understand the impact of raising these fees," he said. "It will make it very, very difficult for many students and many families."

"It's a very disappointing time and a very hard time to be a student in the state of California," said Artemio Pimentel, who stepped down Sunday as chairman of the California State Student Assn. "Students are working extremely hard trying to get a good education at the CSU and often working 30 to 40 hours a week. With sudden increases last year and another 30% this year, students are going into shock."

Some parents, too, are incensed at the size and relative suddenness of the proposed increases.

"I'm really upset," said Janet Burrell of Torrance. "I've got three kids in college, including two who are going to junior college for now because we can't afford to send them all [to four-year institutions] at the same time. This just makes it tougher."

Her daughter, Liz Burrell, 20, a third-year undergraduate student at UC Davis, said she would have to work more outside jobs to help pay for the higher fees. Already, she works 30 to 40 hours a week.

The fee increases under consideration are the biggest in more than a decade. The last substantial increase in the cost of attending UC and Cal State occurred during the fiscal crisis of the early 1990s when the state's economy nose-dived, particularly in Southern California. Student fees increased between 1990 and 1995 for each system. The fees were rolled back by 10% in the boom years of the late 1990s.

Officials of the university systems note that even with the proposed fee increases, students would pay less than the average of comparable institutions across the country.

UC regents are scheduled to vote Wednesday on a two-part recommendation by UC President Richard Atkinson that would raise fees by 25% and authorize him to add an extra 5% if necessary, depending on the outcome of the budget battle in Sacramento. The same day, Cal State trustees will decide whether to boost systemwide fees by 30%.

Some of the impact of the fee increases would be mitigated. According to UC and Cal State officials, most students with annual family incomes of $60,000 or less would have their increases covered by financial aid, while a portion of the increases would be covered for students with family incomes of $60,000 to $90,000.

"We're using students and parents to fill the [budget] gap, which is not good policy," said Bruce Hamlett, chief consultant for the Assembly Higher Education Committee. "It's the middle class that bears the brunt of the increases, but it also negatively impacts lower-income students who may not be aware that federal and state financial aid might help them cover the increases."

Hamlett said a fee plan allowing for gradual and predictable increases each year would be best for students, their families and the universities.

As it is, he said, "when times are good, fees are not raised or are even decreased, but when times are bad, the fees go up drastically. It's really the reverse of what it should be because it comes when families can least afford an increase."

In addition, the fee increases are only part of the impact of the state's budget troubles on students and their families. If the partisan deadlock in Sacramento that has prevented passage of a state budget continues into August, the state would be unable to pay $220 million in Cal Grant scholarships to as many as 220,000 Californians. The grants, which provide for full tuition, vary depending upon which institution the student attends.

"It is going to have an impact on students" the closer we get to August without a budget, said Diana Fuentes-Michel, executive director of the California Student Aid Commission.

Although the UC and Cal State systems may cover the payments on a temporary basis until a budget is signed into law, Fuentes-Michel said community college students counting on Cal Grant scholarships could find it difficult to enroll for classes and pay for books and other expenses.

About 38% of the students who receive Cal Grant awards attend community colleges. Twenty-five percent go to Cal State schools and 20% are UC students. The remaining 17% attend private colleges and universities like USC or Stanford.

Fuentes-Michel said the higher fees could force some students to drop out of college.

Thomas Kane, a professor of policy studies and economics at UCLA, said his research shows that enrollment at public colleges and universities in California declined by about 200,000 students between 1991 and 1994, a time of significant fee increases. Most of that decline came at the community colleges and the Cal State system, but affected the UC system as well, he said.

"Presumably, most of those folks were out looking for jobs," he said. "And it's exactly during recessions that we ought to be encouraging youths to stay in school and get whatever training they need for later. We don't want them out in the labor market looking for jobs when so many others are looking too."

With a California workforce of about 17 million, Kane noted that 200,000 people suddenly on the job market would be enough to push the unemployment rate up by about 1%. Middle-income families will bear the brunt of most of the fee increases, he said, even as their finances may be suffering too.

"Every time we go through this, people say, 'Let's not do it again,' " Kane added. "But every time we have to learn the lesson all over again."


Times staff writer Evan Halper in Sacramento contributed to this report.