2 Bills on Tomorrow’s Tuition at Today’s Prices Pushed

Legislation that would enable parents to pay for tomorrow’s college tuition at today’s prices has been resurrected in the form of competing bills by an Assembly Democrat and a Senate Republican.

The two authors are treading warily in light of last year’s gubernatorial veto of a prepaid tuition bill by Assemblyman Tom Hayden (D-Santa Monica). Hayden’s bill would have allowed parents to pay tuition in installments years in advance, if they wish, at then-prevailing tuition rates. Alternatively, under the Hayden bill, parents could purchase state savings bonds that could be cashed upon maturity at any state college or university.

A bill introduced Thursday by Sen. John Seymour (R-Anaheim) seeks to get around the governor’s previous objections by reducing the financial responsibility of the state. In vetoing Hayden’s bill, Gov. George Deukmejian said he was concerned about the state’s obligations if the investment program ultimately fell short of its goals.

Under Seymour’s plan, private financial institutions would be designated to manage the savings bonds on the parents’ behalf. In return, the institutions would have to guarantee the parents a return equal to an estimate of the yearly rise in the cost of attending college. If the investment did not perform as expected, the institutions, rather than the state, would be expected to make up the difference.

According to Seymour, the estimate would be based on an “independent college index” figure that takes into account the cost of housing and course supplies as well as tuition, something that Hayden’s previous proposal did not do.

Seymour said his bill had been given a “cautious green light” by the Administration and the Department of Finance. However, when asked by a reporter, spokesmen for the governor and the Department of Finance refused to take a position on Seymour’s bill, saying it was too early to do so.

In the meantime, Hayden has introduced a bill identical to last year’s vetoed proposal. He said he hopes that the governor can be persuaded to change his mind.

“We’re working on trying to meet all of his concerns,” said Curtis Richards, a Hayden ally and consultant to the Assembly subcommittee on higher education.

“But we think that his key (objection) is his claim that it’s not the state’s responsibility to help families save for college,” Richards said. “That for us is the (issue) we have to work with the governor on--getting him to understand that this is a serious crisis building, and that parents are fearful they are not going to be able to send their kids to college.”

According to a report released Wednesday by Hayden’s subcommittee, more than half of all California undergraduate students borrowed money in 1985 in order to finance their educations. California students are borrowing almost $650 million for their college education, with loans making up 49% of the student aid “pie.”

Seymour said at a press conference that if tuition continues to rise as swiftly as it has in the past, the cost of attending the University of California in the year 2000 would total $50,000 and the cost of attending a private college would be twice that.

“Why are people not willing to save? When thinking about paying for a college education,” Seymour said, “82% of them think, ‘I can’t save fast enough to get a good enough return to reach my objective’ and therefore they don’t save.”