Monthly Archives: February 2010

Analysis of Governor and Senate Revenue Packages

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To date the Governor and the Senate have each proposed a revenue package to accompany their proposed 2010 supplemental operating budgets. The House’s revenue package is expected any day.

The Governor was first out of the gate with her revenue package last week (February 17) for $605 million.  The Governor’s revenue package is a two-pronged approach: (1) Closing tax loopholes ($112.35 million) and (2) Increasing “sin” taxes ($493.1 million).

Governor Revenue Package

The Governor’s revenue package restores funding to a variety of public services and programs in the areas of education, health care and human services.  Specific to higher education, the Governor restores full funding to the State Need Grant.

Governor's Restoration

The Senate’s revenue package is $313 million dollars larger than the Governor’s proposed package (Total revenue increase of $918 million).

The Senate, like the Governor, targets closing tax loopholes and increasing “sin” taxes. However, the Senate only raises a single “sin” tax (i.e. cigarette tax) and also incorporates revenue from a  temporaray sales tax increase and savings from the implementation of various Senate Bills.

As eluded to above, the Senate used a four-pronged approach in the development of its revenue package: (1) Closing tax loopholes ($518 million); (2) Temporary 0.3%  increase in sales tax ($313 million); (3) Increase cigarette tax by $1 per pack ($85.7 million); and Enactment of various Senate Bills ($1.3 million).Senate Revenue SummaryThe Senate restores funding to many of the same public services and programs that the Governor’s revenue package identifies. Specific to higher education, the Senate restores full funding to the State Need Grant, restores partial funding to the State Work Study program, and maintains commitments to recipients of several smaller financial aid programs that are suspended for the second year of the biennium.

Any revenue increase proposal still has a long way to go in the legislative process before it is law. The Senate and the House must first move their revenue proposals through the appropriate committees in their respective chambers as well as the committees in the opposite chamber.

Any differences between the House and Senate proposals, after the process has been conducted, will need to be settled through conference committee and both chambers will have to concur on any final legislative revenue package.

Analysis of State Financial Aid in Budget Proposals

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The release of the House and Senate proposed 2010 supplemental budgets earlier this week reflected the hard work of the higher education sector in Washington (i.e. students, faculty, and institutions) to lobby the Washington Legislature on the importance of state financial aid to access and affordability of higher education and the state’s dedication to funding these programs.

Both chambers restored funding for the State Need Grant, restored partial funding for the State Work Study program, and maintained commitments to current recipients of several smaller grant programs.

Though the overall outcome is a positive one for state financial aid in Washington, the details between the House and Senate proposal are worth noting. 

Below is a table that summarizes the impact of the proposed operating budgets on the financial aid programs managed by the Higher Education Coordinating Board. In addition, what follows is a brief definition of the lesser known financial aid programs and the details behind the numbers for each proposal on the table. Please note that the Table is sparse regarding the Governor’s proposal. Detals are provided in the narrative that follows.

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State Work Study

 Governor
Suspends funding for this program.

Senate
Maintains average student earnings at current levels. Increases required employer share of wages to approx. 50% (formerly 35%)for proprietary employers and 30% (formerly 20%)  for non-profits . Discontinues eligibility to non-resident students.

 House
Reduces the amount of money students can earn for college in an academic year through part-time work with their wages subsidized by the state.

Washington Scholars
Provides four-year scholarships equivalent to approximately 90 percent of full tuition for three outstanding high school graduates from each legislative district each year.

Governor
Suspends funding for this program.

Senate
Does not award new scholarships for 2010 high school graduates. Freezes current award grant levels for current recipients.

Passport to College
The program includes college awareness, preparation, and mentoring for young people currently in foster care to encourage them to pursue higher education; scholarships for those who enroll in college; and incentives for their college and university to provide counseling and other supports that will enhance the young person’s success in college.

Senate
Reduces funding by one-third.

State-Funded GEAR-UP Projects
Provides pre-collegiate preparation services to students in school districts without structured college access programs.

Senate
Reduces funding by one-third.

House
Reduces funding for this program by reducing the number of school districts served by the state GEAR UP program.

WAVE (Washington Award for Vocational Excellence)
Provides two-year scholarships equivalent to full tuition for three outstanding high school vocational/technical graduates from each legislative district each year.

Senate
Does not award new scholarships for 2010 high school graduates. Freezes current award grant levels for current recipients.

Health Professional Loans & Scholarships
The loan repayment provides loan payment assistance to licensed primary care health professionals. The scholarship provides conditional scholarships to students training to become primary care health professionals. In return, program participants agree to provide primary care health care in rural or underserved urban areas with designated shortages.

Senate
Suspends funding for this program. Funding continues to be available for scholarships and three-year loan re-payment commitments awarded in previous years.

House
Reduces funding for this program. Individuals currently receiving scholarships or loan repayment benefits will continue to receive them, the number of new scholarships and loan repayment awards is reduced.

Future Teachers Scholarships
In return for conditional scholarships or loan repayments, participants agree to teach in Washington K-12 public schools. Selection criteria include academic ability, contributions to the public school system, potential to serve as a positive role model for students, length of time until completion of the education program, and commitment to serve as a Washington classroom teacher.

Governor
Suspends funding for this program.

Senate
Suspends funding for this program. Funding continues to be available for current recipients who were awarded scholarships in previous years to complete their studies.

House
Suspends funding for this program. Students currently receiving scholarships or loan repayment benefits will continue to receive them, the number of new scholarship and loan repayment awards is reduced.

Community School Matching Grants
Provides $2,000 matching awards as an incentive for non-profit, community-based organizations to raise local dollars for college student scholarships.

House
Reduces funding for this program.

Western Interstate Compact for Higher Education (WICHE) Professional Student Exchange

Senate
Suspends funding for this program. Funding is available to continue scholarship commitments to current recipients and to pay dues for Washington’s continued participating in the compact so that Washington residents may continue to receive reduced non-resident tuition rates at participating universities in other western states.

State Work Study Math and Science
Targets state work study experience for students considering careers in math and science instruction.

Senate
Suspends funding for this program.

Foster Care Endowment Scholarship
Scholarships come from the earnings from an endowment which are expected to eventually be sufficient to support college scholarships for former foster care recipients.

Senate
No contribution is made in the second year of the biennium toward an endowment fund

Leadership 1000
A College Success Foundation program that recruits private donors to sponsor scholarships and provide mentorship to financially needy students. State funding is leveraged with private donations.

Senate
Suspends funding for this program.

House
Reduces funding for this program.

Educational Opportunity Grants
Provides additional financial assistance for community and technical college graduates who would otherwise b unable to attend a distant public baccalaureate institution because of work or financial obligations in their home community.

Senate
Suspends funding for this program.  Funding continues to be available to complete scholarship commitments to current recipients, but no new applicants will be selected for the 2010-11 academic year.

State Need Grant

Governor
Reduces  Median Family Income to 50%. Prorates grant awards to serve students eligible under 50% MFI.

Senate
Proposed revenue package directs $136 million into the Education Legacy Trust Account to maintain enrollment and grant levels.

House
Reduces funding for the State Need Grant. Due to higher than anticipated federal aid allocations, the program needs less state funding in FY 2011 than previously estimated. Eligibility and grant awards are not changed. Maintains policy enacted in the 2009-11 biennial budget.

House Capital Budget Moves to the Floor

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The House Capital Budget Committee held an executive session on the House’s proposed 2010 supplemental capital budget this afternoon.

In a concise and directed session, the House Capital Budget Committee moved House Bill 2836 to the floor.

No changes were made to higher education or Evergreen. 

The House Capital budget reduces bond appropriations for the College’s Laboratory and Art Annex Building by $727,000.

The bill was amended by the Committee as follows:

  • Made technical corrections
  • Increased the Department of Commerce’s Housing Trust Fund set aside for building low-income housing units in underserved communities and to concurrently develop capacity in the same communities from $5 million to $10 million.  There was no change in the total appropriation.
  • Added $600,000 to complete school mapping for the remaining community colleges. Reduced the Everett Community College Infrastructure project by $309,000. Increased the negative allotment for the Office of Financial Management by $42,291,000. As a result the State Building Construction Account is increased by $291,000.
  • Allowed for the 2009 capital budget appropriation for the Kittitas Groundwater Study to be used for the purchzse of water for domestic groundwater users in the Yakima Basin Water Resource Inventory Area 39 that have a groundwater right with a priority date later than May 10, 1905 and for all out-of-priority groundwater users in the Yakima Basin, pending an agreement between the Department, Ecology, and Kittitas County.  Created the Kititas County Domestic Groundwater Users Drought Preparedness Account. There was no change in the total appropriation.

Governor Signs I-960 Legislation

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This afternoon Governor Gregoire signed into law  Senate Bill 6130.

Senate Bill 6130 temporarily suspends tax-limiting Initiative 960 in its entirety. From the effective date through July 1, 2011, any action or combination of actions by the Legislature that raises taxes may be taken with the approval of a majority of members elected to each house of the Legislature.

Senate Bill 6130 is effective immediately.

Higher Education Policy Committees Adjourn; More Bills Move Forward

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The Senate deadline to move House policy bills either to an appropriations committee or the Senate floor is this Friday.

Despite this deadline, the  Senate Higher Education & Workforce Development Committee took final action on five bills this afternoon and adjourned for the session.

The Senate Higher Education & Development Committee passed two bills of interest to Evergreen. House Bill 2854 establishes eligibility criteria for the Higher Education Loan Program (HELP) created in the 2009 legislative session.

Students eligible for HELP must meet the following criteria:

  • An annual family income, adjusted for family size, that is no greater than 130% of the Washington median family income.
  • Completion of the FAFSA.
  • Be a Washington resident.
  • Not enrolled in Theology as a field of study.
  • Enrolled at least half-time in an aid-eligible certificiate or degree program up to and including graduate and professional degrees.
  • Maintain satisfactory academic progress determined by the attending institution.
  • In good standing, not delinquent or in default, on federal and state student loans.
  • Current on child-support obligations.

The Committee also took action on House Bill 2930 in the afternoon. HB 2930 directs the Higher Education Coordinating Board to give priority to selecting Future Teachers Scholarship recipients to those individuals who are seeking specialty endorsements in math as well as individuals who are uniquely qualified to help schools address the achievement gap.

Evergreen supported the legislation since its introduction and continues to encourage policymakers to keep in mind students seeking endorsements in English Language Learners and special education.

The Committee amended HB 2930 with clarifying language. Specifically, the amendment clarifies that the Higher Education Coordinating Board (HECB) is not required to award loan repayments to all program participants. In addition, it stipulates that the HECB must begin loan repayment for the Alternate Route Program upon documentation of federal student loan indebtedness and completion of the first year of teaching service.

In the House, policy committees diligently worked to move Senate bills forward in the process right up to yesterday’s deadline.

The House State Government & Tribal Affairs Committee took action on Senate Bill 6196. SB 6196 grants military leave for required military duty, training, or drills including those in the National Guard and clarifies that an officer or a state or local government employee can only be charged military leave for the days he/she is regularly scheduled to work.  

The House Education committe took action on Senate Bill 6696. SB 6696 comprises several policy changes to K-12 to make Washington more competitive for Race to the Top dollars, including policies and structural changes in the areas of school and teacher evaluation, assessment, and preparation.

The Committee amended Senate Bill 6696 is several ways:

  • Requires all educator preparation program providers approved by the PESB to adhere to the same standards and comply with the same requirements.
  • Requires the State Board for Community and Technical Colleges to select up to three community colleges to offer a BA plus teaching certificate in a subject matter shortage area. Specifies that programs are subject to degree and certificate program approval procedures by the SBCTC, HECB, and PESB.
  • Clarifies that candidates in all alternative route programs have their performance evaluated by both their mentor and the preparation program supervisor before moving to less supervision.
  • Repeals several additional sections of law pertaining to student teaching centers and the partnership grant aspects of the alternative route program.
  • Removes a duplicate section pertaining to the HECB and needs assessments for the educator workforce.
  • Declares that an essential aspect of overall education reform is reform in state financing for Basic Education, both in the way that funds are distributed and the overall level of state support to school districts.
  • Sets forth in statute baseline values for Basic Education funding, as recommended by a technical working group and the Quality Education Council, for the prototypical school funding formula adopted in 2009 legislation,effective September 1, 2011. Modifies various prototypical school formula elements and allocation categories.
  • Increases the maintenance, supplies, and operating costs (MSOC) factors in the funding formula to a total of $1,082.76 per student over a three-year period.
  • Provides a K-3 class size allocation of 15.0 students per classroom teacher, to be phased in over a five-year period starting with high poverty schools.
  • Requires continued incremental phase-in of full-day kindergarten according to the statutory schedule, with full implementation in 2018.
  • Implements a new pupil transportation funding formula as of 2011 rather than 2013, and states that full funding of the new pupil transportation formula is to be phased in over a three-year period.
  • Restores a requirement that school districts maintain a minimum staffing ratio for Basic Education of 46 Certificated Instructional Staff per 1,000 students rather than repealing the requirement as of 2011.
  • Requires a report from a Compensation Working Group by June 30, 2012, rather than December 1, 2012, and changes the lead agency to OSPI. Starts a Local Finance Working Group immediately with a report due November 30, 2010. Expands tasks of the Group.
  • Continues the Funding Formula Technical Working Group to monitor implementation of the formula and provide technical advice to the Quality Education Council.
  • Directs the Washington State Institute for Public Policy to calculate a savings from improvement in graduation rates and requires OSPI to publish this in an annual report.
  • Directs OSPI to implement an internet portal displaying the prototype school allocations compared to actual allocations, by building.

The Budgetary Impact on Evergreen

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Analysis of the Senate and House operating budgets on Evergreen continues as hundreds of pages of legislation are examined for potential impacts on the College.

In addition, efforts are underway to understand the impact of the House Capital Budget proposal on the College. The Senate Capital Budget has yet to be released.

As the impact becomes clearer over the next few days updates will be provided.

But here is what we know to date.

Operating Budget – Governor, Senate and House

Changes to the Base Budget

The Governor’s proposed supplemental budget provided Evergreen with $444,000 for health benefits and salaries.  This was reduced in the House and Senate budgets to an increase of $4,000 in each budget. 

In addition, both Chambers provided funds for additional studies to be conducted by the Washington State Institute for Public Policy. The Senate appropriates $50,000 for research support to the Quality Education Council. The House appropriates funds for three studies for a total appropriation of $125,000: (1) Examining substance abuse treatment, (2) A K-12 Study, and (3) Mental Health Assessments.

Finally, the House proposal reduces the College’s budget by $150,000 to transfer the Labor Education and Research Center from Evergreen to South Seattle Community College.

Reductions

The Governor, Senate, and House proposals all reduced state funding for Evergreen. The Governor reduces funding by $1.62 million, while the House reduces funding by $768,000 and assumes another $415,000 of additional cuts will achieved from the yet to be passed furlough bill (SB 6503). The Senate reduces state funding by $1.18 million and also assumes a savings of $426,000 from the yet to be passed furlough bill (SB 6503). Both provide flexibility to Evergreen to administer these reductions.

Fund Transfers

Both the Governor’s and the Senate’s proposed budgets shift Maintenance & Operation (M&O) funds from the Capital budget to the Operating budget. The Governor proposes a shift of $2.89 million and the House a shift of $3.247 million.  Although the House Budget doesn’t shift any expenditures to the capital program, their budget would sweep $5.9 million of our local TESC capital projects account fund balance into the State General Fund as a way to lessen overall state budget cuts.

2010 Operating Budget Comparison

Capital Budget – House

The House Capital budget reduces bond appropriations for the College’s Laboratory and Art Annex Building by $727,000.

Evergreen Testifies on Proposed Senate and House Operating Budgets

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John Hurley, Vice President for Finance and Administration, testified before the Senate Ways & Means Committee this afternoon on the Senate’s proposed 2010 supplemental operating budget.

This was  followed by testimony at an evening committee meeting on the 2010 supplemental operating budget proposed by the House.

Hurley provided similar testimony to both committees. He expressed a heartfelt thank you on behalf of the College for the restoration of the State Need Grant and investments in State Work study and other state financial aid programs. In addition, Hurley recognized the difficult climate  we as a sector and as a state find ourselves in and the work policymakers have done to maintain access and affordability for our students. Finally, he expresssed one concern regarding the shift of capital funds to the operating budget and stated that Evergreen would work with legislative staff to clarify.

House Policy Committee Deadline Passes, Senate Has Until End of Week

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At 5:00 p.m. today the deadline for House policy committees to further consider Senate policy bills passed. Senate policy bills in the House must have been moved to either an appropriations committee or to the House floor by end of day today. 

The Senate has a few more days to get bills through the process. The Senate must move House policy bills to an appropriations committee or to the floor by 5:00 p.m. February 26.

Washington State House

This morning, the House Higher Education Committee moved three bills Evergreen has tracked this session.

Senate Bill 6355  a.ka. the system design bill,  implements the recommendations put forth by the Higher Education Coordinating Board’s (HECB) System Design Plan work during the interim.  The bill identifies a process for expanding the higher education system upon proven demand and for reaching the goals in the HECB’s Master Plan.

The bill was amended to: (1) Require the HECB to consider the strategic and operational use of technology in higher educaiton as part of the process developing the state needs assessment; and (2) Provide the HECB additional direction in awarding grants from the Washington Fund for Innovation regarding improving the use of technology.

Senate Bill 6357 requires The College Board in consultation with the four-year sector, workforce training and education board, private career schools, business, and labor to develop policies for awarding academic credit for learning from work and military experience, military and law enforcement training, career college training, internships and externships, and apprenticeships.

Senate Bill 6467 allows institutions of higher education to confer honorary degrees upon persons who were students at those institutions in 1942 but did not graduate because they were ordered into an internment camp.

This afternoon the House State Government & Tribal Affairs Committee moved House Bill 5041. HB 5041 encourages state agencies to award 3 percent of all procurement contracts under $35,000 in value to certified veteran-owned businesses.

Senate

This morning the Senate Higher Education & Workforce Development took executive action on two bills of interest to Evergreen.

 House Bill 2973  includes, in the definition of “resident student,” a student who resides in Washington and is on active military duty stationed in one of nine Oregon border counties. In addition, the bill adds a student who resides in Washington and is the spouse or dependent of a person who resides in Washington and is on active military duty stationed in an Oregon border county to the definition of “resident student.”

House Bill 2638 provides a specialized-format version of instructional material may not require that the student return the specialized-format version.

The Committee amended the bill to clarify that neither a public nor an institution may require a student to return purchased materials. 

Evergreen Testifies in House Capital Budget Committee on Budget Proposal

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Dr. John Hurley, Vice President for Finance and Administration, testified during an evening committee meeting on the Capital Budget proposed by the House of Representatives.

After conveying his appreciation for the hard work the committee did in drafting the budget proposal, Dr. Hurley expressed support for the $200 million appropriated to create jobs in the K-12 sector and conveyed the institution’s hope that the investment would eventually benefit higher education. He also mentioned the halting of capital projects on Evergreen’s campus, but assured the committee that the institution would do its best to handle the cut. Before closing, Dr. Hurley took the opportunity to remind the committee of the biomass gasification investment that Evergreen requested the legislature partner with students on.

House Releases 2010 Capital Budget Proposal

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Later this afternoon, the House released their proposed 2010 supplemental capital budget.  The Senate’s proposed capital budget is expected later this week.

Highlights of the proposed budget are below. Details regarding the specific impact to Evergreen will follow soon.

House Capital Budget Highlights

  • Avoids exceeding the 9 percent constitutional debt limit should general state revenues decline, interest rates rise, and potential emergencies occur.
  • Reduces the overall bond appropriations by $31 million.
  • Directs the Office of Financial Management to work with state agencies to achieve savings in the amount of $42 million by reducing allotments or by withholding allotment approval for those projects that have not demonstrated substantial progress towarwd contract execution by November 30, 20010.
  • Provides $200 million to create jobs through energy efficiency improvements in K-12 public schools.
  • Provides $100 million towards housing assistance.

Details of the House proposed 2010 capital budget can be found on the Washington State Legislative Evaluation & Accountability Program Committee Website.