NEW BRUNSWICK — Saying it is time to "make a statement" on behalf of cash-strapped New Jersey families, the Rutgers University board of governors slashed a proposed undergraduate tuition hike in half Thursday over the objections of the school's president.

The board approved a 1.6 percent increase in tuition and fees — the lowest hike for in-state students in more than two decades — after a dramatic and emotion-filled meeting at Winants Hall in New Brunswick.

The 11-member board was preparing to vote on a 3.1 percent hike in tuition and fees when Chairman Ralph Izzo proposed cutting the tuition portion of the increase in half, reducing the hike by about $183 per student.

The proposal caught some board members and university officials by surprise. But Izzo, chairman of PSE&G’s parent company, argued "these are different times" and the high unemployment rate and lingering effects of the recession justified scaling back the increase.

After a lengthy debate, other board members agreed.

"I think we should be bold and make a statement for the students," said Candace Straight, one of the board’s newest members.

After nearly three hours of public comments and debate, the board voted, 7-2, to cut the planned tuition increase in half as students, professors and staff in the crowded meeting cheered. University officials could not remember the last time the board had publicly rejected a proposed tuition hike at the last minute and come up with their own number.

Under the new plan, in-state undergraduates will pay $10,104 in tuition (a 1.8 percent increase) and $2,651 in mandatory fees (a 0.7 percent increase) for a total of $12,755 a year— or $195 more than last year.

The board also approved a 3.3 percent increase in room and board costs. A typical undergraduate living on campus will pay a total of $24,017 — or $551 more than last year — once tuition, fees, room and board are added together.

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Rutgers also raised graduate tuition and out-of-state undergraduate tuition, but the exact numbers were not available last night.

The vote to scale back the tuition increase for New Jersey residents was a blow for Rutgers President Richard McCormick, who urged the board to stick with the original tuition plan. The president, who is stepping down next year, said his staff spent weeks working with the board’s finance committee to craft a balanced budget with a fair tuition and fee increase for the 56,000-student university.

"That said, my administration will manage effectively and responsibly whatever tuition increases and whatever budget this board adopts," McCormick said grimly.

The lower hike left McCormick’s administration with an unexpected $11 million to $12 million hole in their $2 billion budget due to the lost revenue. Campus officials were unsure what they would cut.

"We will clearly have less money. Less money means we will have very difficult budget choices," said Nancy Winterbauer, Rutgers’ vice president for university budgeting.

Students, who had been lobbying for a tuition freeze, considered the 1.6 percent increase a win for campus protesters. Students staged several rallies, marches and a lengthy sit-in in the campus administration building this spring.

"This is a huge victory for students and I want to thank of the students who made their voice heard over the past year," said Matt Cordeiro, president of the Rutgers University Student Assembly.

Nearly 30 students, alumni, professors and staff spoke at the meeting before the vote. Later, union members led a noisy rally outside the building as the board prepared to vote on the tuition plan and budget.

Rutgers’ faculty and staff unions are fighting for the restoration of raises after last year’s university-wide salary freeze. The two sides are in arbitration over the salary freeze, which union members say is a violation of their contracts.

"It’s disgraceful that the flagship university of the state of New Jersey would negotiate with its unions, come to an agreement and then renege on that agreement," said Chucki Bynes, a senior laboratory technician and president of the union local representing Rutgers’ computer, laboratory and clerical workers.

The Rutgers board planned to discuss the union dispute in a closed session after the meeting.

New Jersey’s other four-year public colleges are holding their own meetings to set tuition on campuses around the state this month. Last year, undergraduate tuition and fees ranged from $9,347 a year at New Jersey City University to $39,816 a year at Stevens Institute of Technology in Hoboken.