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Transfer App question "have you been physically present in california?"

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My daughter is finishing filling out the app to transfer to UC. A question at the end is have you been physically present in CA for the last 3 years excluding brief absences for vacation purposes." She's in her sophomore year at an out of state 4-year-university so I assume she has to answer 'no' to this question. She's lived in CA her whole life until college, has her car registered here, her drivers license here, etc. We just assumed she'd be considered a California resident still but I am not sure what this question means for her. What effect will this have on her application - will they consider her an out-of-state applicant for tuition purposes? Or for the GPA she must have to be admitted? Or both? Thanks for any help.

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