The University of California, Berkeley, will cap attendance costs for families earning between $80,000 and $140,000 in a new attempt to relieve middle-class parents squeezed by tuition hikes.
Starting next year, those families would pay no more than 15 percent of their gross income for tuition, books and living costs, a cap ranging between $12,000 and $21,000. The current resident price tag of attending UC Berkeley is $32,634 a year.
School officials said Wednesday the Middle Class Action Plan would cost between $10 million and $12 million in the first year, on top of a current undergraduate aid budget of $130 million. Funds would come from various sources, including donations and revenues from a growing contingent of out-of-state students.
Students would still be required to contribute a share of costs beyond their family contribution, this year set at $8,000. They typically raise that money through campus work-study programs, summer jobs and student loans.
An estimated 6,000 students come from families in the $80,000 to $140,000 income bracket. The program may provide additional aid to families already receiving help, as well as grants for the first time to those earning between $120,000 and $140,000.
The state cut funding for the entire University of California system this year by $750 million, including a $100 million trigger cut announced Tuesday by Gov. Jerry Brown. To help compensate, the UC regents imposed a systemwide 18.3 percent tuition hike last year.
Middle-class families often get pinched when tuition rises dramatically. Wealthy families have enough income to weather increases, while UC uses roughly one-third of tuition dollars to subsidize low-income students.
"Current financial aid policies benefit some of the most economically disadvantaged families, but middle-class families continue to struggle," said Joey Freeman, a Berkeley junior and University of California Student Association finance officer, in an email. "The MCAP program will begin to provide some much-needed relief."
Berkeley Vice Chancellor Frank Yeary said Wednesday the school has seen warning signs that tuition hikes have burdened middle-class families in recent years. He pointed to rising debt levels among middle-class students, as well as a drop in enrollment.
The move comes as UC Berkeley's private competitors have targeted aid at middle-class families in recent years. Stanford University, for instance, waives tuition and living costs for families earning below $60,000 and offers free tuition for families below $100,000.
Steve Boilard, managing principal analyst for education at the Legislative Analyst's Office, said the plan raises concerns about fragmentation in the UC system. He said UC has maintained a consistent tuition schedule across all campuses, but Berkeley's program sends a "muddy message."
He also questioned whether it was better to spend money helping middle-class students than providing more openings.
"From Berkeley's standpoint, it makes a lot of sense because they may be saying, 'Gosh, we're going to be losing students we want to Stanford,'" Boilard said. "But from a state policy standpoint, should I be concerned that a student is going to Stanford instead of Berkeley?"
Families must have assets below $200,000, excluding home equity, retirement accounts and tax-advantaged college funds.