Monthly Archives: December 2010

Governor Releases Health Care and Pension Policy Initiatives

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On Monday Governor Gregoire announced policy initiatives to further reduce the State’s fiscal footprint.  She announced changes in two signficant areas: (1) Health Care and (2) Pension Plans for the 2011-13 biennium.

Health Care

Governor Gregoire’s policy initiative focuses on further changing Washington’s health care delivery system in order to allow for higher quality, more affordable care. To facilitate this, and consistent with her intent to reorganize state government to operate more effectively and efficiently, she proposed the following.

  • Consolidate a majority of the state’s health care purchasing into a single agency
  • Take advantage of opportunities provided under federal health care reform – the Affordable Care Act
  • Move forward with work launched with the federal Center for Innovation to have Washington serve as a pilot in testing models that ramp up quality and tamp down costs.

Pensions

Governor Gregoire proposed the following actions to reduce future costs to employers and taxpayers while maintaining reasonable benefits for valued public employees and retirees.

 

  • Reverse a 1995 law granting an annual cost of living increase in benefits regardless of inflation.   The Legislature could still consider increases to these benefits, like they did pre-1995, but they would no longer happen automatically.
  • Change the current system which allows workers to retire early without a corresponding reduction in their benefits for all new hires.  
  • Align state support for higher education retirement plans more closely with that provided for other state employers by capping the state’s contribution at 6%. Currently higher education retirement plans provide both a defined contribution amount and a supplemental guaranteed minimum benefit. The alternative would be to allow new higher education employees the option to participate in one of the state’s hybrid pension plans.
  • End retire-rehire benefits in the higher education sector

Governor Announces Plans to Make State Government More Efficient and Smaller

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This morning Governor Gregoire announced her policy initiative to consolidate public services.  She announced the consolidation of public services in five areas.

Consolidating Natural Resource Agendas

  • This initiative consolidates the state’s current eleven agencies to five.
  • Proposes the consolidation of the Department of Fish & Wildlife, the State Parks & Recreation Commission, the Recreation and Conservation Office and the law enforcement unit of the Department of Natural Resources into a new Department of Conservation and Recreation.
  • Proposes the consolidation of the work of the Columbia River Gorge Commission, the Pollution Liability Insurance Agency, and the Department of Health’s reclaimed water program into the Department of Ecology.
  • Proposes the consolidation of the State Conservation Commission into the Department of Agriculture and the Department of Archaeology and Historic Preservation into the Department of Natural Resources.

Consolidating Central Services

  • Eliminate duplicate functions at state agencies
  • Proposes the consolidation of the Department of General Administration, Personnel, Printing and portions of the Department of Information Services and the Office of Financial Management into a new Department of Enterprise Services. 
  • The Department of Enterprise Services will provide the “back office” services and the Office of Financial Management will continue to address policy, budget, forecasting and labor relations.

Creating the Office of Civil Rights

  • Proposes the consolidation of the state’s Human Rights Commission, Office of Minority and Women’s Business Enterprise, Commission on African Affairs, Commission on Hispanic Affairs, and Commission on Asian Pacific American Affairs into the Office of Civil Rights.

Eliminating Boards and Commissions

  • Proposes the introduction of legislation to eliminate 36 boards and commissions and move appointment authority for 16 boards from the Office of the Governor to state agencies.
  • A list of the boards and commissions that will be impacted has yet to be released.

Integrating Correctional Services

  • Proposes potential changes from ongoing discussions between the Department of Corrections and the Washington Assocation of Sheriffs and Police Chiefs regarding short-  and long-term strategies to maximize each correctional system’s strengths and integrate certain services.

Washington House Reduces the Number of Commitees

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This week the Washington House of Representatives released the list of 2011-13 Standing Committees. The list reduces the number of Standing Committees from 25  to 21.

The major committees that focus on higher education policy and appropriations will continue, including Higher Education, Education Appropriations & Oversight, and Ways & Means.

This session there will be several new committees that combine aspects of former committees.  These include Business & Financial Services, Community Development & Housing, Early Learning & Human Services, Environment, Labor & Workforce Development, and Local Government.

The following committees will no longer exist:

  • Audit Review & Oversight
  • Commerce & Labor
  • Community & Economic Development & Trade
  • Early Learning & Children’s Service
  • Ecology & Parks
  • Environmental Health
  • Finance
  • Financial Institutions & Insurance
  • Human Services
  • Local Government & Housing

Committee chairs and membership are expected some time this week.

Governor’s Budget Will Roll Out This Week

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Governor Gregorie will roll out her 2011-13 biennial budget this week.

The 2011-13 biennial budget will be released on Wednesday, December 15. Prior to the release of the budget, the Governor will announce proposed policy changes to healthcare and pension plans sometime today (December 13) and efforts to streamline government and/or fund current services and programs differently in the future on Tuesday (December 14).

The Governor will not likely release her revised 2009-11 budget until Monday December 20.  In addition, it is expected that she will announce additional policy initiative in January.

Washington Legislature Adjourns Special Session

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The Washington Legislature adjourned a one-day special session late this afternoon.

The one-day session reduced the estimated $1.2 billion shortfall in the current biennium by aprpoximately $700 million. 

The legislation passed today to achieve this savings – a combination of reductions, fund transfers, and some revenue changes – will be delivered to the Governor for her signature this week.  

The 2011 session is scheduled to begin Jan. 11 and end on April 24, during which time lawmakers will need to implement further reductions to balance the remaining budget shortfall in the current fiscal year and write a budget for 2011-13. That $32 billion budget is also facing a revenue shortfall, currently estimated at around $5 billion.

Washington Senate Takes Action on Budget Legislation During Special Session

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This afternoon the Washington Senate passed legislation to reduce the state’s budget shortfall in the current fiscal year.  The  passage of this legislation will reduce the state’s budget shortfall by approximately $590 million dollars.

The Senate passed three bills – Senate Bill 6892 (38-0), Senate Bill 6893 (28-11), and HB 3225 (30-9).

  • Senate Bill 6892: Allows the Department of Revenue to waive penalties for companies that owe back taxes and pay up promptly. The measure is estimated to raise over $44 million over six months. 
  • Senate Bill 6893: Suspends child support pass-through payments to families receiving Temporary Assistance for Needy Families benefits.
  • House Bill 3225: Reductions to the 2009-2011 operating budget.

Senate Bills 6892 and 6893 now go to the House for action. House Bill 3225 will go to the Governor for her signature.

Full Week of Committee Hearings for the Washington House

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The latter half of last week was dominated by committee hearings in the Washington House. Several of the committees heard updates and outlooks regarding the budget and issues facing higher education.

On Thursday three House committees met: (1) House Education Appropriations, (2) House Ways & Means, and (3) House Capital Budget. On Friday the House Higher Education met.

The House Education Appropriations Committee heard several presentations including a 2011-13 budget outlook and a report on the Joint Legislative and Audit Review Committee’s (JLARC) Study on Transparency in Higher Education Data.

The House Ways & Means Committee received an outlook for the 2011-13 budget and an update on the collective bargaining for 2011-13. In addition, the Commission discussed solutions to the budget problem.

The House Capital Budget Committee heard updates from grant recipients of the Jobs Act for K-12 School Construction and Higher Education and K-12 Energy Efficiency Program. Representatives from The Evergreen State College – John Hurley, Vice President of Finance and Administration and Paul Smith, Director of Facilities – provided the Committee with information regarding the grants the College received under this program. Hurley and Smith were joined by representatives from the community colleges and K-12.

The Committee also received a preview of the capital budget for 201 1-13 session.

On Friday, the House Higher Education Committee met. The Committee received several major reports and updates. Among the reports and updates was the Study on Transparency in Higher Education Data and reports on dual credit, running start, and the industry skill panel.

Washington House Passes Budget Reductions

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This afternoon the Washington House passed legislation to reduce the state’s budget shortfall in the current fiscal year.  House Bill 3225 passed with a vote of 86-6.

House Bill 3225 reduces the state’s budget shortfall by approximately $590 million dollars. It is the largest portion of a deal reached by both Chambers and the Governor this past week. The deal also includes fund shifts and additional revenue through tax compliance efforts.

The bill now goes to the Senate for action later today.

New Leadership for U.S. House Education Committee

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The U.S. House of Representatives elected Rep. John Kline (R-MN) to chair the U.S. House Education and Labor Committee.

Rep. Kline has indictated that his priorities for the upcoming congressional session include:

  • Increasing oversight of education and workforce programs;
  • Reforming the nation’s education system to protect taxpayers, restore local control and empower parents;
  • Helping employers create new jobs; and
  • Improving training programs to get out-of-work Americans working again.

U.S. House Passes Year-Long Continuing Budget Resolution

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This past week the U.S. House of Representatives passed a continuing resolution to extend the FY10 budget through FY11 and provide $5.7 billion to pay off the pending Pell Grant funding shortfall.

The Continuing Resolution maintains funding for programs in FY11 at the same levels as in FY10 with some exceptions. The Resolution reduces spending to some programs to pay for other spending priorities like the Pell Grant Program.

If passed by the U.S. Senate the Continuing Resolution would become effective when the current continuing resolution expires on December 18. The Resolution is necessary because Congress has not passed the twelve appropriations bills needed to pass a FY11 budget.

It is unclear, however, how the Senate will act. There has been some indication that current leadership would like to combine all appropriations bills into one an omnibus spending bill. Another option would be for the Senate to pass their own continuing resolution, which could last the entire FY11 similar to the House or opt for a shorter timeframe such as a few months.