Qualified students hoping to get into the University of California in the next few years may need more than good grades and impressive character to nail a spot. They may also need a lot more cash and some luck.

UC regents this week will begin confronting tough questions about limiting enrollment and raising fees as they prepare for another year of state funding cuts. The proposals would chip away at California's longstanding guarantee that every eligible student will be admitted somewhere in the 10-campus system.

On the table is the possibility of adding $1,800 a year to the cost of undergraduate admission, a 36 percent increase. That would come on top of the 40 percent fee increase imposed since the first of the year, which has pushed the statewide fee for California undergraduates to $4,984, exclusive of room and board, books and campus-based fees that average about $450 a year.

Among the options being discussed informally are using a lottery to select which eligible students get in and deferring admission for those who don't, and abandoning the practice of automatically referring students to another campus if they don't get into their campus of choice.

Many decisions won't be made until the governor presents a 2004-05 budget in January. But the UC administration is setting the stage for discussions about which students should get priority and how they would be picked if the university has to turn away 2,000 or more eligible students next year.

The Legislature already has warned both UC and the California State University system not to expect state funding for enrollment growth for the 2004-05 budget year even as student demand is growing. And the state finance director has asked the universities to plan for 20 percent funding cuts.

Throughout the state, policy leaders are struggling with how to resolve the clash between these two divergent trends -- shrinking state revenues and an expanding pool of college-age students that is projected to continue growing at least through 2010.

``Unless we find a way to close the gap, things will fall apart,'' said Assemblywoman Carol Liu, D-Pasadena, chairwoman of the Assembly Committee on Higher Education. ``I'm very fearful that if we just continue to cut and don't find solutions to bolster higher education, our system is very much threatened.''

Assembly panel to meet

Liu's committee will begin hearings next week in Sacramento on the prospects for higher education during an era of budget deficits. Over the next four months, the committee will examine alternative financing methods, such as using higher-education vouchers, privatizing parts of the state's research universities and having students pay for college as a percentage of their income after graduation.

These are models being used or considered by other states and countries, Liu said.

``These kinds of crises really can lead people to other ways of doing things,'' she said. ``If Californians are unwilling to dig into their pockets and pay more for services, then we have to look for other alternatives.''

Faced with growing demand, UC and CSU have admitted more students than the state has funded. But now, with the prospect of a continuing state deficit, both systems are turning away students who meet entry requirements.

CSU has said it expects to close the doors to as many as 30,000 students in the current academic year, and UC recently announced it would not consider the applications of 1,500 community college students seeking to transfer to a UC campus for the winter term.

In or out?

The state's dire financial situation is forcing higher-education officials to think about which students it will serve and which it won't.

UC is facing the prospect of having to cut back enrollment from 58,000 students to 56,000 for 2004-05, paring back the number of freshmen admitted or community college transfers.

Among options being considered are restricting the number of international and out-of-state students to make room for California students, said Dennis Galligani, associate vice president for student academic services. Another is admitting students but deferring their entry into the regular academic program while they take classes through the university extension program, where students pay the full cost of instruction.

In the regular academic program, UC students pay about 29 percent of costs and taxpayers subsidize the rest, according to the state Department of Finance.

Regents also will be asked to consider raising fees again. Options being discussed range from an across-the-board $1,800 a year increase to various schemes that involve raising charges for wealthier families.

In all its scenarios, the university anticipates providing financial aid to cover cost increases for needy students and some of the increase for middle-income students.

If things play out as they have in earlier downturns, hundreds of thousands of California students will be denied access to higher education, said Patrick Callan, president of the National Center for Public Policy and Higher Education in San Jose.