HAYWARD -- Cal State Hayward, like many of the 23 schools in the California State University system, has witnessed extraordinary growth in the number of new teaching credential candidates in the past few years.

But the number of students seeking credentials in the university's teacher education program is expected to level off or even decline with the anticipated reduction in state funding, a Cal State Hayward official said Monday.

"It's too early to tell in terms of 2004-05, but it looks like the number of applications is going to be down," said Phil Duren, chair of Cal State Hayward's teacher education department. "We're probably going to have fewer candidates ... because of the budget cuts."

Still, the number of new credential candidates in the CSU system grew to 12,700, an increase of 45 percent, between 1998 and 2003, according to a survey conducted by the California Commission on Teacher Credentialing. The study, titled Teacher Education 2003: The Annual Report on Teacher Education in the California State University, reaffirms that the CSU system is the primary credential provider for most of the new teachers receiving credentials in the state.

"CSU continues to provide California schools with well-prepared, excellent teachers in a time of increased accountability and challenging budgets," said Beverly Young, CSU's assistant chancellor of academic affairs. "We are proud of the many campus and statewide initiatives in teacher preparation detailed in this report."

The trend is reflected in the steady growth in Cal State Hayward's teacher education program. In the past five years, Duren said, he has seen the number of new full-time-equivalent students in the credential program increase by 200, up to about 450 this year.

Duren attributes the rise in new credential candidates to economic forces that have many pursuing careers in education.

"I've been in business at Cal State long enough to see the cycle go twice,"he said. "It's a combination of things. I think job availability and the change of employment in the economy. People want to get out of the business area and get into some type of service directly related to students and kids.

"Most candidates are not just people going for their bachelor degrees. Many of them are switching careers and getting back into education. I think we hit a peak this year."

The trend could reverse itself once Gov. Arnold Schwarzenegger's budget is adopted later this year. The governor has proposed a $200 million budget reduction in funding for the CSU system. That level of reduction in state funding, Duren warned, would result in fewer candidates enrolling in the credential program -- and even fewer classroom spaces to accommodate those seeking credentials.

By Duren's estimation, between 70 and 120 new credential candidates would be turned away from Cal State Hayward if the budget cut is adopted.

"We'll also be forced to shrink the program because of the budget cuts. Because of the cuts, we cannot sustain what we have even though we have the applications," Duren said.

The report concludes that the "vast majority of CSU graduates have a solid grasp of subject matter," and that preparation in math and reading language arts has continued to improve.

An evaluation conducted by the National Center for Education Statistics also found that CSU students are more prepared "to know and understand the diverse student population than other teacher candidates nationally."