The population of the UC system has increased the number of students from out of state to about 18%.
Some lawmakers are pushing to reduce that number to 10%, making more room for California students - but that would also decrease tuition revenue to the system.
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"It's so important because Californians should get the first shot to attend the University of California," said Assemblyman Phil Ting, D-San Francisco, who chairs the Assembly's budget committee.
"Unfortunately over the last 10 to 15 years, because of the last great recession, we've seen a huge jump in out-of state student enrollment," Ting added. "What we want to make sure is we're making more room for Californians because they've been crowded out by out-of-state students over the last 10 years."
But with out-of-staters paying close to three times as much in tuition, there's the question of how the UC system will make up for this loss in income.
UC officials say they understand the goal, but it could lead to negative financial consequences for the system.
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"We understand and support the Legislature's goal of providing more opportunities for Californians at UC, though we believe trying to achieve this through reducing nonresident students will potentially lead to unanticipated outcomes," the UC system said.
Ting says there's a simple answer: The state will have to make up the difference.
"We're going to have to give more state funding, that's the bottom line," Ting said. "And I think the state is very much in favor of that."
The plan could be approved as part of the state budget by the middle of next month. If it becomes law, it would take effect in the fall of 2022.