California Community College Chancellor Jack Scott announced Wednesday that an unprecedented number of students could be locked out of community college campuses next fall, the San Francisco Chronicle reports. Scott estimated that the system will not be able to accommodate 400,000 people due to billions of dollars in taxes that are expiring in June and are now unlikely to be renewed.

California is facing a $26 billion budget deficit and Governor Jerry Brown had hoped to make up about $13 billion of it via the tax-extension referendum that was to go on the ballot in June. However, there has been no progress made in the budget talks in Sacramento this week, and it appears that Gov. Brown’s plan has failed. Democrats, who supported letting voters decide on the tax issue, were unable to convince 4 Republicans to join them in forming the two-thirds majority necessary to place a tax measure on the California ballot.

The CCCS, which already stood to lose $400 million of its funding under Gov. Brown’s plan, is now facing even steeper cuts. Scott says there’s no other way out of the budget hole but by cutting programs and turning away students.

“This is a tremendous tragedy, and a very deep blow to the economy of California,” Scott said, describing community colleges as the “No. 1 workforce training institution” in the state.

Not everyone agrees that eliminating courses is the only option. Steve Boilard, director of higher education with the Legislative Analyst’s Office, said that the community colleges could raise money by applying another fee increase on top of the one taking effect next school year, although he admits that these higher fees could create additional obstacles for low-income students seeking a college degree.