University officials are the latest group to pop out of the governor's office happy with a bittersweet budget deal pairing cuts and promises.

Gov. Arnold Schwarzenegger is either very persuasive or very intimidating. Chancellors of the University of California and California State University, sharing a stage with the governor, expressed only enthusiasm about accepting a lean year -- actually one more lean year -- in return for a promise of slow and stable funding increases in years to come.

Under this ``higher education compact,'' the approaching school year will be no picnic. Mandated enrollment decreases that forced universities to turn away thousands of students remain in place. So do cuts of about $300 million for each system.

After that, however, enrollment can grow at 2.5 percent a year and funding at 3 percent to 4 percent. And universities promise to meet certain performance goals.

As with the deals the governor cut for K-12 schools, trial courts and possibly with local government, the Legislature has the power to dump this deal. Mending it, not ending it would be a better way to go.

What's good about the deal is its recognition of budget realities -- a $12 billion shortfall -- and the establishment of stability in funding and in student fee increases, enabling both administrators and students to plan.

The compact puts student fees on a predictable path upward, ending the cycle of reductions in good times and hikes in bad ones that has made some students winners and others losers depending on when they reached college age.

What's bad in the deal is its continuation of the enrollment cuts imposed for the coming year. Had the governor been willing to consider a relatively small tax increase, in addition to higher fees, the doors could have remained open to all.

As fees increase, financial aid must increase as well. For needy students, admission is only a flattering acceptance letter if they can't afford to attend.

With a public university system second to none, California has made a generous promise of access to potential college students. While financial realities are forcing some readjustment, failing to preserve the essential promise would be shortsightedness at its worst.

THE DEAL DETAILS
Here are key elements of the budget deal:

• Funding stability: After cuts in 2004-05, UC and CSU will receive 3 percent increases the next two years and 4 percent for the following four years.

• Enrollment: After enrollment cuts in 2004-05, UC will be funded to enroll 5,000 additional students annually and CSU, 8,000 students.

• Outreach: Effective outreach and academic preparation programs will be preserved.

• Fee hikes: Fee increases for graduate students announced in January will be cut in half. With exceptions, fees will rise 20 percent. Undergraduate fees will rise 14 percent next year and 8 percent each of the two following years. After that, fees would increase slowly and predictably, tracking increases in per capita personal income.

• Making the grade: The university systems will meet various performance criteria including: providing the classes needed to graduate on time; effective use of systemwide resources; clear transfer path from community colleges.