There is hope for the 30 UC Berkeley graduate students who had their Fulbright applications shot down after a missed postmark deadline.

The U.S. State Department has agreed to review the applications as long as California finds a way to pay the cost of a Fulbright -- roughly $20,000 per student. The full J. William Fulbright Scholarship Board must still approve the highly unusual compromise next week, but chairman Steven Uhlfelder is hopeful it will.

"This was not the students' fault," Uhlfelder said Tuesday from his law office, Uhlfelder & Associates P.A. in Tallahassee, Fla. "Whether it was Federal Express or the University of California's fault, it's not material at this point. The intent was to get the (applications) in on time. Why should we penalize the students?"

The decision pleased UC Berkeley Chancellor Robert Berdahl, who had unsuccessfully pled the university's case in Washington, D.C., after Federal Express failed to pick up the applications Oct. 20.

Money for the scholarships -- which normally would be covered by federal funds -- will come from the campus and other sources, Berdahl said in a statement.

"We are very grateful to the Fulbright board for the speed with which it addressed the issue and for the leadership shown by its chairman, Steve Uhlfelder," he said. "They understood the real concern had to be the impact on students. And, they worked out a solution that, while not ideal, is more than satisfactory and provides a workable outcome to help the students."

Berkeley officials are asking Federal Express, which has taken responsibility for the missed pick-up, to help the university financially.

The company blamed its failure to pick up the packages on a software glitch. But the U.S. Department of Education contends Berkeley administrators should have driven the applications to the post office when they realized Federal Express wasn't going to pick them up on time.

Students may apply for a prestigious Fulbright Scholarship for graduate study abroad either through the Department of Education -- as the UC Berkeley students did -- or through the U.S. State Department.

Education officials have continued to refuse to review the UC Berkeley applications. But the State Department has agreed to take on that role and make recommendations to Uhlfelder's 12-member board. The board, appointed by President Bush, will decide who wins a Fulbright.

Of the 30 Berkeley students who applied last year, 15 received grants.

"This is an extraordinary situation," Uhlfelder said, noting that the unusual circumstances under which Berkeley students may receive Fulbrights won't taint the prestige of winning one..

"At the end of the day, these people will be Fulbright scholars."