The state would cover the cost of reducing nonresident students at UCLA, UC Berkeley and UC San Diego from 22% to 18% over five years beginning in the fall of 2022, which would make room for about 4,500 California students over that period.
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The budget also proposes to provide funds to enroll the additional California residents in next year's freshman class.
It comes after the UC system received a record number of applications last year when the system had less seats for qualified students.
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The Associated Press contributed to this report.