California's current budget dilemma has the potential of giving incoming college freshmen and their parents a very abrupt and costly lesson in trying to obtain a higher education.

It is no secret that the expense of earning a bachelor's degree is going up at all institutions, and academically qualified students from low and middle-income families risk being squeezed out. It is ironic, however, that the proposed reduction in state-funded grants to private colleges and independent universities may actually exacerbate the problem and make the situation at public universities and community colleges even worse.

Currently, low-and middle-income students who attend independent universities in California can qualify for up to $9,708 through the Cal Grant program to help pay for tuition and fees. The governor's budget for Fiscal Year 2005 proposes to cut the maximum grant amount to new students starting college this fall by 44 percent (a reduction of $4,200 per student).

At the same time, the income ceiling for qualified families would be lowered by 10 percent. In a state where the average annual cost for tuition at a four-year private college is $17,350 (not including room and board which can average $7,000 a year), the effect this financial aid cut would have on economically disadvantaged students would be devastating.

Nationally, students who attend independent universities pay 62 percent of what it costs an institution to provide an education, which can be offset by grants, scholarships and work-study programs. In comparison, the state's system, which consists of the University of California, California State Universities and California Community Colleges, is heavily subsidized. UC students only pay 30 percent of the cost of their education, and CSU students pay just 20 percent of the total costs to take classes – regardless of their economic background or ability to pay.

As a Catholic institution of higher learning, the University of San Diego is committed to advancing academic excellence, expanding liberal and professional knowledge, creating a diverse and inclusive community and preparing leaders dedicated to ethical conduct and compassionate service. Historically, USD has educated all of the academically qualified students enrolled in the university, regardless of their economic background or ability to pay. To achieve this goal, an extraordinary number of scholarships have been awarded to USD students.

However, a financial void that would be created by the loss of the Cal Grant funds would be impossible to fill. As a result, California students from low-and middle-income families who are academically qualified to enroll in USD may be denied that opportunity.

Currently, about 15 percent of USD's undergraduate student body receives support through Cal Grants. The proposed cut in this program would impact about 375 of our incoming freshmen. Multiply this example by 69 independent universities throughout the state who enroll approximately 118,000 total undergraduate students, and the effects of the proposed cuts in Cal Grants become painfully clear.

Reducing Cal Grants to independent universities will have long-term economic consequences to the state. If California's academically gifted students who are financially challenged cannot attend private institutions of their choice, where are they to go? They will turn to the state's UC or CSU system which is already overcrowded, struggling with budget cutbacks and faced with mounting tuition increases.

Independent colleges and universities produce 23 percent of the bachelors degrees awarded in California, along with 49 percent of master's degrees and 46 percent of doctoral degrees. Class sizes are smaller at private colleges and classes are more available.

According to a survey by the National Association of Independent Colleges and Universities, 65 percent of private college students graduate with a bachelor's degree in four years compared to 34 percent of students at public institutions during the same period of time – regardless of their background. This means students at private colleges can graduate and enter the work force more rapidly than their counterparts at state universities, and also avert additional years and continued costs to attain their bachelor's degrees.

Nonpublic universities must operate under state and federal regulations in order to receive taxpayer funded grants, loans, research awards and other types of financial support. However, as private (nonprofit) corporations, independent universities are under tremendous demands to operate more efficiently and business-like. As a result, the performance of faculty is under greater scrutiny and more attention is focused on student achievement.

In other words, you often get what you pay for, whether it is financed through daddy's stock portfolio, family savings, loans or state Cal Grants. The public's investment in students through Cal Grants at private colleges is a good deal and, for the state, one might even call it a bargain. Academically able and financially disadvantaged students can get an education, the state's job base is broadened, and government coffers are replenished by more young people with college degrees entering the market place with higher earning potential.

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Cleary is director of community and government relations and Logue is director of financial aid services at the University of San Diego.