Facing budget deficits from Trump and state cuts, UC seeks $130 million in loans

Facing the budget deficit due to federal cuts, the uncertainty of the Federal demand and the needs of the growing population, the University of California said that the zero interest loan is about $130.

UC’s top financial manager made an urgent request in a letter to the state Department of Finance, asking for quick approval from lawmakers so that the loan can be used during the current fiscal year.

“The university is currently facing myriad budget pressures, particularly as a result of federal actions targeting higher education institutions and ongoing challenges in the state’s fiscal environment,” Chief Financial Officer Nathan Brostrom.

Brostrom said the program is exceeding its enrollment goal for California residents.

“While we work to refinance our campuses, the loan will be prioritized for one-time student support services that are critical to ensuring student success and completion of a degree,” he wrote.

The loan option was given to UC under the state budget passed this year that cut annual funding by 3%, or about $130 million.

The state said this 3% cut, previously promised as part of a “compact” to increase state student enrollment and meet other goals, could be withdrawn in fiscal year 2026.

The same zero-interest loan corresponding to federal funding – $ 144 million – was also given this year to California State University. CSU applied for the loan last month and was approved, although the amount has not yet been determined. CSU plans to use the money to provide a one-time bonus to faculty and staff, which they have faced in campus budgets. The university is negotiating with the California Calcial Assn., the largest union of 29,000 workers, over a new contract.

At UC, the budget pains have been great.

The Trump administration suspended $584 million in Federal Research Grants to UCLA in July for alleged underpayments by campuses and others facing rights payments of about $1.2 billion to return the money. Almost all of the money has been returned due to the case led by the meritocracy, but the fear remains about the continued reduction and that the sovereign organizations will accept new grant applications or renewals from the UC investigators.

In September, UC President James B. Milliken warned that the 10-campus system faces “one of the $17.9 billion

After the takeover and state funding cuts, UC has been tightening its belt, including free hiring, cuts in administrative spending and changes to the curriculum. About 40% of UC’s $11 billion core budget comes from the State, with tuition and fees covering most of it. The entire operating budget, including its health programs, includes $53 billion.

“One of the challenges that the campuses are facing is to provide adequate support for students in an area where the funding of the state is renewed, otherwise it rejects the shared goal of enrollment,” said Caín Díaz, C associate Vice President of the exchange.

“The loan will help to address certain needs immediately, and especially certain needs that face student-facing services,” he said, pointing to the threatened cuts to Federal Snap food benefits.

In addition to food assistance for low-income students and families, campuses have seen other students who need to grow or wait in additional areas.

At UCLA, budget cuts have forced some campus operations to be cut, as well as retention programs aimed at students who don’t manage staff and programs.

At UC Berkeley, the state’s latest state-of-the-art programs are led by the end of the program that helps Scan Francisco Bay Area students through the college application and financial process.

After receiving the loan, the C’s will probably distribute the money across campuses based on enrollment, with UCLA and UC Berkeley taking in more students. While university leaders will encourage campuses to spend money on student services, they will be open to other uses.

“College officials are experts in understanding their student population and where the needs are, so we don’t want to overexplain how they spend money, but we ask them to prioritize student services,” said Dííaz.

If approved, uc must repay the loan in 12 months. The University authorities are hopeful that it will get enough state money in the next financial year to cover all the loans.

“We need to make sure that here they know and where the services are that they have the services they need to be successful. We are grateful that the State has given us the power to reach out to our students,” said Kathleen Fullerton, UC Vice President of State Government Relations.