SAN FRANCISCO (AP) - University of California regents have taken a look at their budget prospects for the coming year, and they don't like what they see.

"Budget cuts over time have begun chipping away at the quality, accessibility and affordability of the university," said UC President Robert C. Dynes as the system's governing Board of Regents met Wednesday. "These things are hard to regain."

Regents are not expected to pass a budget until later this spring, but Gov. Arnold Schwarzenegger's proposed spending plan attempting to deal with the state's multibillion-dollar deficit would raise fees and reduce financial aid, along with making a number of other cuts.

UC would get $2.67 billion in state funding under the governor's plan, an 8 percent decrease. Schwarzenegger is proposing that UC increase undergraduate student fees by 10 percent, which would bring the annual average to about $6,000. He also is proposing a 40 percent increase for graduate students as well as increasing fees for professional schools and out-of-state students. Meanwhile, the governor's budget would decrease the amount of financial aid available to middle-income families.

The proposed budget would not fund UC's normal annual growth of 5,000 students this fall and would require cutting an additional 3,200 students. The plan is to offer those students free tuition at community college with the promise of transferring in two years.

Although they haven't passed a budget, regents have outlined broad budgeting priorities, some of which conflict with the governor's proposals.

For instance, the governor is proposing increasing the student-faculty ratio from nearly 20:1 to nearly 21:1. UC's priorities call for maintaining the current level and eventually decreasing to under 18:1.

Another area of conflict is the 40 percent increase for graduate students, which would be accompanied by a reduction in financial aid.

"This just won't work for us," said Larry Hershman, UC's budget director, who said there will either have to be more a lower fee hike or more financial aid - possibly through higher fees, although he acknowledged that would be a very unpopular plan.

Hershman said it's possible officials could consider higher fee hikes for other students, too, if the Legislature makes more cuts or if voters don't pass Proposition 55, a $15 billion education bond on the March ballot.

However, regents and UC officials said the budget cuts could be worse and they will try to work with the governor's office and legislators.

Hershman said he's hopeful a compromise can be worked out on outreach funding, which was eliminated under the governor's budget. The funding, which normally would be $33 million for 2004-05, pays for a number of programs that link UC and the K-12 system and attempt to prepare disadvantaged students for college.

Regent Ward Connerly said the proposed program cuts is micromanagement that should be resisted, but "we need to take heed of the pressure behind that micromanagement and ... try to figure out how we're going to make this a leaner, and not meaner, vehicle for the 21st century."

Students attending the meeting implored regents not to raise fees.

"An additional 10 percent will make it incredibly hard for me," said Arman Rezaee, a student at UC Berkeley.