MERCED, Calif. — University of California, Merced officials said Wednesday that construction will continue on the first new UC campus in nearly three decades despite a state Senate subcommittee vote a day earlier to delay the opening for one year.

The Senate Budget Subcommittee on Education voted Tuesday to postpone the school's opening from fall 2004 to fall 2005, saving the cash-strapped state budget $4 million.

The decision must be approved by the state Assembly and Gov. Davis before it is final.

The action would push UC Merced's already reduced operating budget from $11.3 million to $7.3 million.

University spokesman James Grant said construction will continue and that alternate plans are being considered in case the opening is delayed.

"A delay is certainly conceivable in this budget climate," Grant said Wednesday.

Eight faculty members have already been hired and 120 students have been identified as eligible for enrollment, Grant said.

He said faculty members could spend the additional year creating a curriculum, and that arrangements could be made for students.

"We will find a way to take care of them within the UC program," Grant said. "It could mean that we'd have to ask them to take distance learning courses for a while or we could open up facilities in Fresno and Bakersfield and do some teaching there."

Grant said students could also take classes at other UC campuses.

"We'll just have to see if we have to wait another year to implement our mission," Grant said.

The site will be the first new UC campus since Santa Cruz opened in 1967, and will serve the San Joaquin Valley, where some 40,000 kids graduate from high school every year.