As part of an effort to end the California budget stalemate, an agreement was reached among state legislators to increase tuition fees for community college students and to impose a $50-per-unit "differential fee" on students already holding a baccalaureate degree. A survey by the Chancellor's Office for the California Community Colleges (CCC) found that 48% of these baccalaureate (BA) degree holders, or roughly 60,000 students, dropped out in response to the fee increase. Given that three out of five baccalaureate-holding students attend community colleges for job training or skills upgrading, the fee increase undermines the state's ability to retrain its workforce, further exacerbating the statewide economic slump. The imposition of the differential fee was a last-minute budget agreement, not preceded by public debate, and most observers agree that the fee was adopted for economic, rather than educational or public policy reasons. In supporting the fee, legislative proponents relied on anecdotes about college graduates taking "personal enrichment" and "recreational" courses at community colleges. They argued that BA holders were taking places away from less sophisticated first-time students, and that priority should be given to those who have not yet had an opportunity to attend college. While the Chancellor of the CCC supported the fee increase, groups representing students, faculty members, and administrators opposed it. With implementation of the new fee in January 1993, segments of the CCC have experienced considerable enrollment declines, including a 14% decline in the Los Rios district, and a 15% decline at Foothill College. Contrary to the arguments of many who favored the legislation, significant enrollment declines have taken place in the skills upgrading and job retraining courses. (PAA)