Monthly Archives: January 2010

Greater Government Accountability

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This morning the Senate Operations & Elections Committee held a public hearing on Senate Bill 6362.

Senate Bill 6362 relates to government accountability. In an effort to learn more, I attended the hearing.  Evergreen did not weigh in on the bill.

Senate Bill 6362 builds on an evolving effort to improve state government accountability and transparency. In the mid-nineties the Joint Legislative Audit and Review Committee (JLARC) was created to make state government operations  more effective, efficient, and accountable. JLARC employs the State Auditor and conducts performance audits, program evaluations, sunset reviews, and other analyses to meet its objectives.

In 2005, the Legislature passed legislation that created the Citizen Advisory Board to improve efficiency, effectiveness, and accountability in state government. The Board works in sync with the State Auditor.

In the fall of 2005, Washingtonians passed Performance Audits of Government Act (PAGA) which increased the role of the State Auditor by allowing this office to conduct independent, comprehensive performance audits of state and local governments. 

Senate Bill 6362 would focus the State Auditor’s work on verifying the efficiency of the top ten government priorities identifiedy by the Legislature. As a result, in addition to audits of programs and activities by agency, SB 6362 would permit audits of identified priorities.

So what are these priorities? They are:

1.  Student achievement in K-12

2. Quality and respect for public workforce

3. Value of state college or university education

4. Health of state citizens

5. Security of the state’s vulnerable children and adults

6. The economic vitality of business and individuals

7. Statewide mobility of people, goods, information, and energy

8. Safety of people and property

9. Quality of the state’s natural resources

10. Cultural and recreational opportunities throughout the state.

Each year, under SB 6362, JLARC would select one of the ten priorities and determine the relative priority of all programs and actitivies within that category. Those priorities identified as the highest would be subject to a performance audit by the State Auditor to determine that the programs and activities are operating at maximum efficiency. Those priorites determined to be the lowest would have a less demanding assessment.

The tasks identified under SB 6362 would be funded through a 30% allotment of funds assessed against the Performance Audits of Government Account.

The only group to testify during the public hearing for SB 6362 came from Washington newspapers in support of the bill.

T.G.I.F, Senate Committee Hears Purchasing Bill

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Senate Higher Education & Workforce Development Committee met this afternoon. The bill of interest to Evergreen was Senate Bill 6413.

Senate Bill 6413 allows institutions of higher learning to purchase personal services; materials, supplies, or equipment; or information services made by state institutions of higher education by using contracts entered into by, for, or through group purchasing organizations.

Kathleen Haskett, Evergreen’s Purchasing & Contracts Manager, testified in support of SB 6413. She expanded on the changes the bill would provide for higher education purchasing policies and the potential costs savings to the institution.

Legislature Week 3: What is Happening

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Several work sessions and public hearings are scheduled on critical issues that impact higher education the third week of session. To learn more follow the links below.

This week the focus of the higher education policy committees (i.e. House Higher Education and Senate Higher Education & Workforce Development) plan to tackle several critical issues impacting Washington’s institutions including performance agreements, system design, teacher preparation, tuition policy, three-year degree, and financial aid.

In addition, the appropriations committees (i.e. Senate Ways & Means and House Ways & Means) will meet to continue their work on budget related matters.

New Revenue Sought by Closing Loopholes, Taxing Income

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On Friday three bills constituting an overhaul of Washington State’s tax system were introduced – two in the Senate (SB 6713 and SB 6714) and one in the House of Representatives (HB 3070). The Senate bills were introduced at the request of the Washington State Department of Revenue by Ways and Means co-chair Senator Rodney Tom and co-sponsored by several of his colleagues in committee.

Senate Bill 6713 effectively ends exemptions on sales of certain livestock equipment, as well as on the compensation of certain corporate officers, which the bill does not recognize as a legal exemption, but as “a widespread misunderstanding among corporate directors that the business and occupation tax does not apply to the compensation they receive for serving as a director of a corporation.” The bill proposes to clear up this misunderstanding by holding corporate officers responsible for their obligation via the Department of Revenue.

Senate Bill 6174 promises to close tax loopholes on real estate transactions and the use of certain digital materials (including downloads, software and online video services). The closing of these loopholes will be facilitated by an interest rate on all unpaid taxes.

House Bill 3070 levies an tax on the income of individuals in the State of Washington by way of a graduated scale based on earned income and marital status. Unlike previous proposals that sought to only tax incomes in the six figures, HB 3070 levies a tax on all eligible earners. The following tables break down the tax proposal:

For married taxpayers filing jointly:

If taxable income is:. . . . . . . . . . . . . . . . . . . . . . . . The tax is:
Not over $49,900 . . . . . . . . . . . . . . . . . . . . . . . . 2.2% of taxable income
Over $49,900 but not over $120,650 . . . . . . . . . . . .$1,098 plus 3.5% of the excess over $49,900
Over $120,650 . . . . . . . . . . . . . . . . . . . . . . . . . . .$3,574 plus 6.0% of the excess over $120,650

For “head of household:”

If taxable income is:. . . . . . . . . . . . . . . . . . . . . . . . The tax is:
Not over $37,425 . . . . . . . . . . . . . . . . . . . . . . . . 2.2% of taxable income
Over $37,425 but not over $90,488 . . . . . . . . . . . . $823 plus 3.5% of the excess over $37,425
Over $90,488 . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,681 plus 6.0% of the excess over $90,488

And for single or married filing separately:

If taxable income is:. . . . . . . . . . . . . . . . . . . . . . . . The tax is:
Not over $24,950 . . . . . . . . . . . . . . . . . . . . . . . . .2.2% of taxable income
Over $24,950 but not over $60,325 . . . . . . . . . . . . .$549 plus 3.5% of the excess over $24,950
Over $60,325 . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,787 plus 6.0% of the excess over $60,325

Each of the bills was referred to fiscal committees – Ways and Means in the Senate and Finance in the House.

Bills Galore in Higher Education Committees

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Evergreen ran the gauntlet this morning in an attempt to be in multiple places at once. On Tuesdays, the House and Senate higher education committees meet at the same time. As a result, Tuesdays are always a high exercise day as higher education folks strategically move from one committee to the other and back again.

Amid this structured chaos, Evergreen was able to weigh in on multiple bills heard in both committees that impact higher education in various ways.

In the House Higher Education Committee, The Evergreen State College spoke to the College’s support for HB 2858 and HB 2854. House Bill 2858, a.k.a. the purchasing bill, would allow four-year, public institutions to participate in group purchasing. The use of group purchasing would provide Evergreen with additional cost savings.

House Bill 2854 moves forward policy implemented during the 2009 legislative session. HB 2854 would build on the establishment of the Higher Education Loan Program (HELP) by creating the HELP account, establish criteria for student participation and establish annual limits on loans to be granted under this program. The Evergreen State College testified in support, along with students, the HECB, and career colleges. Taking the lead from the sponsor of the bill, Rep. Kenney, Evergreen’s testimony: (1) emphasized the importance of first funding grants and work study opportunities for students before considering loans and (2) recognized the important of low-interest, public loan options for students pursuing a college education.

In addition, Evergreen expressed concerns regarding House Bill 2655 and House Bill 2822. House Bill 2655 implements the Higher Education Coordinating Board’s System Design Study completed in 2009. Evergreen is concerned that the bill, as drafted, does not reflect the recommendations of the HECB’s study. Evergreen is working, through the Council of Presidents, with the HECB to ensure that the final draft does reflect the hard work of the System Design Work Group. Evergreen also expressed similar concerns regarding Senate Bill 6355 the companion bill to HB 2655.

Finally, House Bill 2822 would require higher education institutions to include proposed tuition and fee rates for the next two-year period as a component of the institution’s proposed operating budget outlines submitted to the HECB. The Evergreen State College, along with the University of Washington, and community colleges acknowledged the work of the HECB on tuition policy over the past year, but expressed concerns regarding the limits that HB 2822 would place on an institution’s ability to consider tuition as the last dollar in once the state established appropriation and financial aid funding levels.

On the Senate side, Evergreen supported Senate Bill 6357 which would create consistency with regard to academic recognition of prior experience.

Finally, Evergreen expressed opposition to Senate Bill 6358 which would fiscally penalize students if they accumulate more than 125 percent of credits, drop more than 25 percent of credits, or remain on academic probation for more than one quarter or semester. Evergreen is concerned the proposed policies outlined in the bill would negatively impact retention and the pursuit of a college education for students.

Bills Moving to Floors for Action

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A handful of bills have moved to the House and Senate floor for action this week.

House Bill 2561, a.k.a the Jobs Creation bill, was passed by the House 57-41 on Wednesday.

House Bill 2561: (1) Authorizes the State Finance Committee to issue $861 million in general obligation bonds, to be known as Jobs Act Bonds (Act), for the purpose of creating jobs by constructing capital improvements that lead to energy-related cost savings in public schools, state colleges and universities, and other public facilities; (2) Appropriates funds for grants to public school districts, public higher education institutions, state and locally-owned facilities, and facilities owned by subdivisions of the state; and (3) Directs the Secretary of State to submit the short title, intent and bond authorization sections of the Act to the people for adoption and ratification or rejection in the next general election to be held in the state.

In addition, Senate Bill 2561, if enacted, would be a vehicle by which Evergreen could seek funding for the design and construction of the Biomass Gasification Project that the College is seeking funds for a feasibility study this session. Evergreen will continue to work to move this successfully move this bill through the Senate.

The House amended HB 2561 to correct the name  of the account that funds are drawn from to pay debt service and directs the State Treasurer to move funds to pay debt service to the bond retirement. In addition, changes were made to the time in which a project that does not use Energy Savings Performance Contracting must verify energy and operational savings for 10 years  or until the project has paid for itself, whichever is shorter.

Engrossed House Bill 2651 now moves to the Senate Ways & Means Committee for consideration.  

House Bill 2858 was passed by House Higher Education on Wednesday. House Bill 2858 provides institutions of higher education the authority to participate in group purchasing agreements.

Kathleen Haskett, Evergreen’s Purchasing & Contracts Manager, testified in support of HB 2858. She expanded on the changes the bill would provide for higher education purchasing policies and the potential costs savings to the institution.

More and more bills are expected to move to the floor and opposite chamber this week and next as the first cut-off date (February 2) looms for policy bills.

Senate Committee Moves Salary and Furlough Legislation

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The Senate Ways & Means Committee moved two bills from committee to Rules this afternoon.

Substitute Senate Bill 6382  and Senate Bill 6503 were passed out of Senate Ways & Means to Senate Rules for consideration.  The original bill was not considered. Instead a substitute bill was heard and acted upon.

Substitute Senate Bill 6382 extends the current prohibition of  salary and wage increases for exempt and Washington Management Service (WMS) employees of state agencies and institutions of higher learning  through June 30, 2011. An employer may grant a salary increase to a position for which it has a demonstrated difficulty retaining qualified personnel, provided that the increase can be paid within existing resources and without adversely impacting the delivery of client services. Any agency ;giving a salary increase for an exempt or WMS position must submit a reort to the fiscal committees of the Legislature by July 31, 2011, describing the increases given and the reasons for the increases. The prohibition on salary increases is expanded to include awards of cash or cash equivalents given in recognition for performance or longevity.

Senate Bill 6503 also passed out of Senate Ways & Means.  The final version of SB 6503 to pass out of committee was different from the original bill in four major ways:

1.  State agencies are directed to acheive a $69.154 million reduction in employee compensation costs from the near G-F through mandatory and voluntary furloughs, leave without pay, reduced work hours, voluntary retirements and separations, layoffs, and other methods. Agency compensation reduction plans must be submitted by May 15 and approved by OFM by June 1. Agencies that fail to submit an approved compensation reduction plan will be subject to 13 specified agency closure dates beginning in June 2010.

2. Additional exemptions are provided along with those originally outlined in the bill. None of the new exemptions are higher education related.

3.  OFM may designate alternative closure dates if necessary for a particular agency and various technical changes were made to facilitate implementation and collective bargaining.

4. Removes requirement that collective bargaining take place with a single consolidated union.

Senate Rules   is expected to act on SB 6382  ans SB 6503 quickly, moving the bills to the Senate Floor for action tomorrow.

Tuition the Topic of Conversation in the Senate

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The Senate Higher Education & Workforce Development Committee held a public hearing this afternoon focused on tuition policy. Four bills held the attention of Committee Members and a packed hearing room for nearly three hours.

SB 6276 – Grants the University of Washington tuition-setting authority.

SB 6562 – Authorizes the governing boards of the four-year, public institutions to set tuition and fees for resident undergraduate students with constraints, requires institutions to develop performance agreements with the state, and increases the amount that institutions must maintain for financial aid.

SB 6509 – Modifies the current budget proposal process between the HECB and the institutions to include recommendations on tuition and fees.

SB 6625 – Changes higher education tuition and financial aid provisions.

Each of the Senate bills approached tuition policy in a different way, especially with regard to levels of flexibility, required financial aid investments, and the establishment of performance agreements between the four-year public institutions and the State of Washington.

Tuition Comparison

Students from across Washington expressed concerns regarding shifting tuition setting authority from the Legislature to the governing boards of the four-year, public institutions. Most students spoke in favor of SB 6509 and shared concerns about the three remaining bills. Students shared specific concerns with regard to SB 6562 including the high tuition cap,  lack of oversight in the bill, and exclusion of graduate tuition and fees.

The six presidents of the public baccalaureate institutions spoke as a panel to the bills and tuition policy overall.  Chair Kilmer captured the comments of the presidents well by restating five principles/themes he noted from their comments.

1.  Optimize the state investment in higher education.

2. Any tuition policy does not release the state from its responsibility to fund higher education.

3. The unique missions and students mixes of each institution must be acknowledged relative to state appropriations, tuition, and financial aid.

4. Tuition policy should provide limits that will allow students greater predictability and stability.

5. Accountability of the institutions is a critical component of any tuition policy dialogue.

In his comments to the Committee, President Purce acknowledged the major role tuition plays in our higher education funding structure and the  unprecedented economic times facing Washington, which will require non-traditional thinking and strategies to manage our public institutions.

Purce affirmed Evergreen’s long-held position on tuition by stating that the College believes that any conversation regarding higher education funding must integrate and acknowledge the interplay between state appropriations, financial aid, and tuition. In addition, he welcomed the active dialogue Evergreen is engaged in with  the other public, four-year institutions in Washington to move forward a policy by which higher education can have the tools necessary to manage in times of even more cuts this year and those projected for the 2011-13 biennium.

Purce echoed the need for the state and higher education to make a commitment to find a way(s) that recognize the different missions among the institutions, different student bodies, a strength of Washington’s higher education sector, and  meet the unusual circumstances we find ourselves in as a sector and as a state.

State Treasurer Jim McIntire provided his personal support for SB 6562. He stated that institutions should be responsible to set their own tuition prices that reflect the unique markets each institution works within. In addition, he recognized the limited authority provided in the bill to raise tuition, presence of accountability measures via performance agreements, and need to maintain the integrity and quality of Washington institutions of higher learning.

Ann Daley, Executive Director for the Higher Education Coordinating Board, discussed tuition policy within the context of the Board’s recent tuition policy study. She encouraged policymakers to aim to recalibrate the relationship between tuition, financial aid, and state approprations.

In addition, representatives from the Governor’s Office, League of Education Voters, business community, faculty, and the community colleges also testified to the need to protect the quality of higher education while keeping the doors open to students.

Senate Committee on Ways and Means Outlines Capital Budget

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Senate Ways & Means Capital Budget Coordinator Brian Sims presented an overview of the current state of Washington’s Capital Budget during Wednesdays’ committee hearing.

The Capital Budget is comprised of $3.3 billion dollars, half of which is money borrowed from investors in the form of bonds and other debt. The budget itself is the smallest of the three state budgets, which also include the large Operating Budget ($58.7 billion) and the Transportation Budget ($6.6 billion).

Sims pointed out during his presentation that the majority of funds disbursed from the Capital Budget go to parties other than state interests. This means that state funds are being used as grants for construction and maintenance of institutions other than the state’s own. Among the funds used to build and maintain state institutions’ interests, funding for public schools has grown the fastest. Most of these funds are not cash, however, and come in the form of bonding authority. Higher Education’s bond funds from the Capital Budget have grown, too, while other funds – including cash – have remained flat for a decade.

As the state deals with a budget crisis, another issue the legislature has to confront is the constitutionally-mandated debt limit. The debt limit, monitored by the State Treasurer, cannot exceed 9% of the average annual general revenue for the preceding three fiscal years. In addition, because the Capital Budget, unlike the Operating Budget, does not have an “ending fund balance,” a margin of 0.25% is set aside as an ending balance. According to Governor’s proposed Capital Budget, that 0.25% ending balance is maintained by cutting $375 million from the budget. The Governor’s budget also proposes an increase in bond spending of $86 million and a transfer of $147 million from the Capital to the Operating Budget, a short-term maneuver to create more liquidity in the Operating Budget.

What does this mean for Evergreen? The college has identified a need for an allocation of $125,000 from the Capital Budget to complete funding for a Biomass Gasification plant. TESC students and the college itself have each generated $125,000 to put toward a feasibility study for the project. As the Capital Budget writing process plays out, the college will be asking legislators to support the sustainable vision for a biomass plant, which would help the college realize its 2020 goal of carbon neutrality while providing synthetic gas to heat and potentially power the institution’s facilities.

Higher Education in the House Education Committee

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The House Education Committee, which focuses K-12 education, heard House Bill 2654 focusing on preparing teachers for a career in teaching during its hearing on Wednesday. Teacher preparation is one of many areas in which higher education intersects with K-12.

House Bill 2654 defines an Elementary Math Specialist as an elementary teacher with a specialty endorsement in elementary mathematics and directs the Professional Educator Standards Board (PESB) to adopt a specialty endorsement for Specialists, based on standards that include enhanced mathematics content knowledge for grades K-6 and instructional strategies.

The Evergreen State College testified in support of HB 2654 and offered two major suggestions for improving the bill. First, Evergreen believes that the current terminology in the bill, “widely accessible to elementary teachers across the state,” should be broadly interpreted to mean more than online coursework. A critical element of coursework in math education is that teachers learn math from teachers who model good pedagogy. Without this modeling the ability to learn effective teaching methods is limited.

Second, we encouraged legislators to push for more than the “minimum of additional coursework” required in the bill. If the state truly wants to scale up teachers in the mathematical and pedagogical preparation it is critical that teachers receive substantive opportunities to learn.