SACRAMENTO - Calling on lawmakers to rearrange their priorities, the leader of the California State University system warned Monday that proposed budget cuts would close the doors of education to thousands of students.

The publicly financed Cal State system is an investment in the state's economic future, Chancellor Charles Reed said. He added lawmakers seem more willing to spend almost $31,000 to incarcerate a criminal in state prison - an amount triple taxpayers' annual cost to educate a Cal State student.

"Today, we need to remind our legislators that California needs to get its priorities straight," Reed told Cal State officials before they visited the Capitol to lobby lawmakers. "In previous budget cuts, access was postponed. But now it's clearly threatened in California."

Department of Finance spokesman H.D. Palmer said administration officials are working with Reed and other Cal State officials to target cuts in a way that would spare students.

At Cal State San Bernardino, demand in the fast-growing Inland area normally would increase the student body from 17,000 to 18,000 next year. But officials instead are planning to shrink the campus to 16,000 students because of expected budget cuts.

"We've increased the cost. We've had to reduce the access. But I don't think it makes sense to alter the quality of what we provide," said Albert Karnig, president of Cal State San Bernardino.

As for the plan to divert incoming Cal State students to community colleges, "We think it's a way to utilize the community college system in a way that heretofore they have not been utilized," Palmer said.

Monday's event continued a budget-time ritual for higher education advocates, and came a week after thousands of community college students marched to the Capitol to protest a 44 percent increase in tuition fees.

Facing a shortfall his administration estimates at $14 billion, Gov. Schwarzenegger proposed cutting $82.4 million from the Cal State system in his January budget. That is on top of almost $24 million in mid-year cuts the governor ordered in December. The plan would cut Cal State and University of California enrollments by 10 percent, with accepted applicants instead sent to community colleges for their freshman and sophomore years.

The budget plan also reflects an increase in undergraduate tuition from $2,046 to $2,250 a year, less than a third of what each student costs the general fund. But Reed said the strategy would break with the state's tradition of providing qualified students a spot at a publicly financed university. "Many of the students who have graduated from high school who have made themselves eligible to come to the California State University, this is their dream. They want to go to a four-year institution," he said.