SACRAMENTO, California (Reuters) - California’s Democratic Governor Jerry Brown, eager to show quick results from newly passed twin tax hikes he promoted to avoid drastic education cuts, joined state university officials on Wednesday to announce an immediate rollback in tuition rates.
Officials said new revenues from temporary tax increases approved by voters on Tuesday allows the 23-campus California State system, the nation’s largest four-year state university network, to avert a $250 million mid-year budget cut.
A 9 percent tuition hike, raising annual fees by $249 per semester for 2012-2013 academic year, was approved by the university’s board of trustees in November of last year in anticipation of those cuts.
But with passage of sales and income tax hikes in a ballot measure approved 54 percent to 46 percent, annual tuition fees for full-time undergraduate students in-state will now revert back to $5,472, the same rate as in the previous academic year.
“The election last night was a clear and resounding victory for children, schools, and the California dream,” Brown told a news conference. “Instead of the state borrowing, hat in hand, from our school districts, we’re going to have enough money to fund the schools as our constitution requires.”
The smaller University of California system’s regents had also warned that tuition at its schools, which include UCLA and UC Berkeley, with a total of more than 220,000 students, could have risen by as much as $2,400 per year if the tax measure had failed.
The measure, Proposition 30, raises the state sales tax by a quarter-cent for four years and increases income tax rates for individuals who earn more than $250,000 a year for seven years, and earmarks the resulting revenues for education.
The sales tax increase is effective January 1, 2013 and the income tax increase is effective starting with the 2012 tax year, according to Brown’s office.
California’s public education system suffered serious and repeated cuts to its budget as the state dealt with an entrenched fiscal crisis. Those cuts included the loss of tens of thousands of teachers and thousands of community college courses.
The Cal State University system had already implemented belt-tightening measures, including leaving vacant tenure-track faculty positions unfilled, reducing library acquisitions, and a general salary freeze for staff and faculty.
“This victory will certainly help us in our battle to restore fiscal stability to the University of California,” UC Regents Chairman Sherry Lansing said in a statement.
Writing by Mary Slosson and Steve Gorman; Editing by Cynthia Johnston and Christopher Wilson