Budget cuts hurt Calif. state universities hard

California is home of some of the greatest universities in the nation. But at a time when a good education is more critical than ever, budget cuts are hitting state schools hard. And, as CBS News correspondent Bill Whitaker reports, students are paying the price.

Southern Californian Eric Pedroza -- who is the first in his extended family of 84 to graduate high school -- was accepted at Yale and Columbia. However, he chose to study neuroscience at UCLA.

"I stayed here for in-state tuition," he explained. "Private school tuition was out of my league and I don't receive any help from my parents at all."

He works three jobs and got a scholarship and a federal Pell grant -- just enough to cover this year's tuition of $11,124. He's not sure about next year.

"It is frustrating not knowing what my future may hold," said Pedroza.

It's a frustration felt throughout California's public universities: 10 prestigious University of California research campuses like UCLA and Berkeley and the sprawling, 23-campus Cal State University system. Together they serve more than 600,000 students.

This year they had their budgets cut a combined $1.3 billion.

"The California prison system is funded higher than both the University of California and the California State University taken together," said Charles Reed, chancellor of the California State University system. "Now that is outrageous."

At least 24 other states have cut higher education funds this year, but none as deeply as California.

"We've had to raise tuition twice this year," Reed said. "We've had to reduce our operating budget rather significantly."

At UC Riverside, a brand new, state-of-the-art medical school, sits empty. There's no money to run it.

"I'm sitting here having hired the faculty to be able to open the school, but I don't have any students for them," said Richard Olds, dean of UC Riverside Medical School.

California's public university system was emulated around the world, according to Olds.

"To see the finest public education system probably in the world disinvested in is really a great tragedy."

California, like most states in this recession, is hemorrhaging red ink. Legislators had to cut more than $26 billion to balance the budget. Education -- one of the largest budget items -- took one of the biggest hits.

Eric Pedroza says he'll take out loans or try to earn more money. "I'm willing to do whatever it takes to graduate and get the UCLA diploma in hand."

He may have to. Tuition at UCLA is going up $1,068 in the fall.