Blaming under-funding by the state, UC President Mark Yudof is proposing raising student tuition by 8% and reducing pension benefits for future employees.
The tuition increase, which UC's Board of Regents will vote on at their meeting in San Francisco next week, would come on top of a 32 percent hike that went into effect earlier this year.
If approved, undergraduate fees for California residents would rise to $11,124 annually, or an average of $12,150 when campus-based fees are included.
The fee increase would generate about $180 million in annual revenue, of which nearly $64 million would be set aside for financial aid. That would leave about $116 million to support UC's operating budget, Yudof said at a media briefing and in an open letter to California residents.
"This added revenue will put the university on a footing that allows campuses to reinvest in faculty, expand course offerings, improve academic support and generally begin to recover ground lost last year to crisis," Yudof wrote. "It will ensure the resources needed to maintain excellence."
Yudof also proposed a two-pronged approach to address $21 billion in unfunded liability for the UC system's retiree pension and health care programs.
Current employees and the university would begin to contribute more money to the retirement plan, but there would be no reduction in benefits, he said.
Employees hired after July 1, 2013, would be offered a plan with slightly reduced benefits, a step that would cut costs by 20 percent, Yudof said.
The minimum retirement age for new employees would rise from 50 to 55, and the age to receive maximum benefits would increase from 60 to 65.
The Board of Regents will discuss Yudof's retirement proposal next week and vote on it in December.
Yudof, who has headed the UC system for 2.5 years, acknowledged that his ongoing effort to raise fees, cut programs, and impose furloughs and layoffs "is not an agenda for anyone seeking to win a popularity contest, but so be it."