Gov. aims budget scalpel at Cal Grants

Gov. Arnold Schwarzenegger is proposing major cuts in Cal Grants, the state’s main financial aid program for college students. The most significant change would involve abandoning the state’s commitment to cover any rise in tuition for grant recipients, and it comes as officials at both the University of California and California State University are gearing up for 10% fee increases in response to the yawning state budget gap.

The Legislature in 2000 guaranteed middle- and low-income students who meet certain financial and academic benchmarks nearly full offsets of their fees, which have escalated sharply in recent years.

Judy Heiman, an analyst with the state legislative analyst’s office, said “decoupling” the fees and the grant funding might not cut too deeply the first year, but could quickly add up if fees continue to jump as they have in the last decade. “It will be 4-5% this year, then maybe 10% or even 20-30%,” she said. “It could get to the point even students with full grants can’t afford to pay fees.”

The governor’s $87.5 million in proposed reductions -- about 10% of the total $880-million Cal Grant budget -- also would eliminate an aid program that helps returning adult students and would slash the grant money available to state students attending private colleges and universities. Cal Grants and a fee waiver program are the state’s primary financial aid vehicles. Other aid is provided by the federal government, colleges and universities.

A spokeswoman for the governor said he “understands how difficult these cuts will be” but is responsible for leading the state through the economic crisis. “The governor doesn’t want to cut programs and he doesn’t want to raise taxes, but in the face of a $42-billion budget deficit and with the Legislature’s failure to pass a comprehensive solution, we’re simply running out of options,” she said.

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gale.holland@latimes.com