Author Archives: garverj

Agreement Reached on State Debt Limit

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Late this afternoon the House and Senate announced an agreement on the capital budget and the key policy issue that has prevented a budget to date – the state debt limit.

The 2011-13 biennial capital budget will be a capital budget with some limits to the debt capacity.

The key points of the agreement include:

  • A smaller 2011-13 capital budget (approximately $1.1 billion) 
  • Something will be placed into statute this year on a working debt limit but a constitutional amendment will not be sought at this time.
  • The debt limit will be reduced over a period of time.
  • A blue ribbon commission will be established (SB 5181) to study and recommend changes to the state’s debt capacity, with the authority to block bonds if its recommendations are ignored. The commission will include legislators, the state treasurer, OFM, and others with expertise on bonds and financing.

The actual budget for capital projects will come in two stages. The cash projects in the capital budget will appear in a striking amendment for SHB 1497.  In addition the Legislature will pass a striker to a second bill (HB 2020) which is the bond bill.

The capital budget is expected to be released some time tomorrow.

Conference Operating Budget Announced and Moved

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This morning the Washington House and Senate announced a conference operating budget for the 2011-13 biennium. By this afternoon the House had voted 54-42 to move the budget to the Senate.  The Senate is expected to take up the budget tomorrow.

2011-2103 Operating Budget
The conference biennial budget addresses a $4.9  billion shortfall, making approximately $4.5 billion in policy level reductions. The budget reduces funding for higher education institutions by $535 million.  The Evergreen State College is reduced by $12.152 million and authorized to increase tuition by 14% per year for the biennium.

In addition the budget maintains the state need grant to offset budgeted tuition increases to students and reduces, but does not eliminate , state work study.

In addition to the reductions to higher education the proposed budget makes the following reductions.

  • $1.2 billion – Elimination of Initiative 728 and Initiative 732
  • $344 million -Change in how certain future pension benefits are calculated for Plan 1 retirees
  • $215 million – Elimination of K-4 class enhancement
  • $179 million – K-12 employee salary reduction
  • $177 million – 3% salary reduction in state employee salaries
  • $150 million – Hospital rates and related changes
  • $129 million – Reduction to Basic Health Plan
  • $116 million – Reform to the Disability Lifeline cash program
  • $97 million – Reduction of personal care hours for long term care and developmentally disabled clients
  • $61 million – Change to K-12 National Board Bonus program
  • $57 million – Student assessment system changes

Senate Concurs on Bill to Eliminate HECB

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This afternoon the Washington Senate concurred on legislation – with a vote of 47-0 – to eliminate the Higher Education Coordinating Board and create the Office of Student Financial Assistance and the Council for Higher Education by July 1, 2012.

Senate Bill 5182 eliminates the Higher Education Coordinating Board on July 1, 2012, and establishes a Council for Higher Education subject to recommendations of a Steering Committee on Higher Education and legislation enacted in 2012.

The Steering Committee on Higher Education will be chaired by the Governor or her designee and include four legislators and equal representation from higher education sectors in the state.

Between now and July 1, 2012 the Higher Education Coordinating Board will continue several of its current responsibilities but not all. Senate Bill 5182 eliminates several Higher Education Coordinating Board functions to reflect the reduction in state funding for the agency. The areas eliminated include reporting on state support received by students, the costs of higher education, gender equity, capital budget prioritization, technology degree production, costs and benefits of tuition and fee reciprocity with Oregon, Idaho, and British Columbia, and transmitting undergraduate and graduate educational costs to boards of regents.

The bill now goes to the Governor for her consideration.

House Passes Legislation to Eliminate the HECB

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This afternoon the Washington House passed legislation – with a vote of 59-28 – to eliminate the Higher Education Coordinating Board and create the Office of Student Financial Assistance and the Council for Higher Education by July 1, 2012.

Senate Bill 5182 eliminates the Higher Education Coordinating Board on July 1, 2012, and establishes a Council for Higher Education subject to recommendations of a Steering Committee on Higher Education and legislation enacted in 2012.

The Steering Committee on Higher Education will be chaired by the Governor or her designee and include four legislators and equal representation from higher education sectors in the state.

Between now and July 1, 2012 the Higher Education Coordinating Board will continue several of its current responsibilities but not all. Senate Bill 5182 eliminates several Higher Education Coordinating Board functions to reflect the reduction in state funding for the agency. The areas eliminated include reporting on state support received by students, the costs of higher education, gender equity, capital budget prioritization, technology degree production, costs and benefits of tuition and fee reciprocity with Oregon, Idaho, and British Columbia, and transmitting undergraduate and graduate educational costs to boards of regents.

The bill now goes back to the Senate for concurrence.

GET Bill Moves Out of Senate

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The Washington Senate passed a bill – with a vote of 41 to 3- that would make changes to Washington’s current Guaranteed Education Tuition (GET) program, in particular changes to the Committee on Advanced Tuition Payment.

Senate Bill 5749, as passed by the Senate, would:

  • Retain the provision that specifies the length of term for the members on the Committee on Advanced Tuition Payment appointed by the Governor for four-year terms instead of an unspecified period of time and adds two additional representatives of private business appointed by the Governor, who must consider names from a list provided by the President of the Senate and the Speaker of the House of Representatives.
  • Add that the Committee on Advanced Tuition Payment utilize the State Actuary in reviewing the Guaranteed Education Tuition Program rather than a national recognized actuary, but the Committee may, at its discretion, obtain an assessment by a national recognized actuary.
  • Add that the Committee on Advanced Tuition Payment utilize the State Actuary in planning and devising a college savings program, but the Committee may, at its discretion, obtain an evaluation from a lified actuarial consulting firm.
  • Require the Committee on Advanced Tuition Payment, with the State Actuary, to review the program in light of passage of E2SHB 1795 (higher education opportunity act) and to make any necessary changes to the program for units purchased on or after September 1, 2011.
  • Establish a Legislative Advisory Committee to the Committee on Advanced Tuition Payment to provide advice regarding the administration of the program.
  • Remove all other provisions pertaining to new requirements after August 1, 2011.

 The bill now goes to the House for further consideration.

Senate Committee Takes Action on Endowment

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This afternoon Senate Ways & Means Committee took action on legislation that would establish an endowment for students studying in high-demand fields.

HB 2088 creates the Opportunity Scholarship Program and the Opportunity Expansion Program to mitigate the impact of tuition increases, increase the number of baccalaureate degrees in high employer demand and other programs, and invest in programs and students to meet market demand fields of study while filling middleincome jobs with a sufficient supply of skilled workers.

The Committee amended the bill as follows:

  • Required all members of the Opportunity Scholarship Board be appointed by the Governor.
  • Required that for two of the appointments the Governor consider selection from a list of names provided by the President of the Senate and the Speaker of the House.

House Bill 2088 now goes to the floor for further consideration.

Word on the Street is May 25 is the Target to Get Out of Olympia

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This week, the fourth and last full week prior to the May 25 sine die, started out no different than the prior weeks of this thirty day special session.  However that has appeared to change as of last night.

The House, previously scheduled to return to Olympia on Monday, is now scheduled to come back to town on Saturday and work every day through May 25.  Tomorrow the House Ways & Means Committee is set to hold a marathon session of public hearings and executive actions on a series of bills ranging from reorganizing and streamlining central service functions, powers, and duties of state government to requiring extraordinary revenue growth to be transferred to the budget stabilization account.

In the meantime, the Senate is on the floor all day today moving several bills through the process.

Word on the street is that the higher level of activity on The Hill is being pushed by movement on several key policy issues that have separated the two chambers during the regular session and for most of the first special session, such as the state debt limit where a compromise may split the difference between the House and Senate positions. In addition policymakers are rumored to be close to a budget deal.

The one issue that may continue to cause havoc is workers’ compensation. Reports suggest that the Governor has shared a compromise that would be a hybrid between settlements and pensions.

Senate Committee Holds Public Hearing on Endowment

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This afternoon the Senate Ways & Means Committee held a public hearing on legislation that would establish an endowment for students studying in high-demand fields.

HB 2088 creates the Opportunity Scholarship Program and the Opportunity Expansion Program to mitigate the impact of tuition increases, increase the number of baccalaureate degrees in high employer demand and other programs, and invest in programs and students to meet market demand fields of study while filling middleincome jobs with a sufficient supply of skilled workers.

Senators asked several questions ranging from how this endowment will interact with existing state financial aid programs, the state matching requirement, and the potential size of the endowment.

Washington House Passes Endowment Legislation

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This afternoon the Washington House passed – with a vote of 84-8-  legislation that would establish an endowment for students studying in high-demand fields.

HB 2088 creates the Opportunity Scholarship Program and the Opportunity Expansion Program to mitigate the impact of tuition increases, increase the number of baccalaureate degrees in high employer demand and other programs, and invest in programs and students to meet market demand fields of study while filling middleincome jobs with a sufficient supply of skilled workers.

The House passed a single technical amendment to the bill to: (1) Provide that the Opportunity Scholarship Board’s oversight and guidance must be consistent with legislative priorities, (2) Ensure that references are consistent and refer to “eligible education programs”, (3) Clarify a reference to the state need grant in light of an earlier amendment that struck provisions that would have renamed the state need grant the opportunity award program, and (4) Make clear that all annual reports from the Opportunity Scholarship Board and the program administrator are due no later than December 1st. 

House Bill 2088 now goes to the Senate for further consideration.

House Capital Budget Moves Debt Limit Legislation

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This afternoon the House Capital Budget Committee took action and passed legislation that would direct the Secretary of State to submit a constitutional amendment – that would reduce the state’s debt limit from 9% to 7%  by FY 2022 – to the voters for approval and ratification, or rejection, in the next general election to be held in the state.

This policy proposal has been a point of contention between the Senate and the House, with the Senate in support and the House opposed. 

The key points both supporters and opponents have made about the bill were echoed by committee members this afternoon during deliberations. Those in support shared their belief that it is critical to reduce the state’s debt levels. While those in opposition raised concerns about the impact the reduction in the debt limit would have on state capital projects and workers.

The bill that passed the House Committee – with a vote of 6 to 5- was designed to reflect many of these concerns, especially the need to reduce the debt limit, while minimizing the impact to state projects and workers. The House amended version does the following: 

  • Reduces the debt limit from 9% to 8.5% beginning in FY 2018 and thereafter. The Senate version reduced the limt from 9% to 7% in half-percent increments every two years beginning in FY 2016 and ending in FY 2022. Current law sets the debt limit at 9%.
  • Directs the Legislature to establish an advisory debt limit that is one-half of one percent lower than the constitutional debt limit; and allows the advisory debt limit to be adjusted to reflect changes in economic trends and conditions. The Senate version would allow the Governor and the Legislature to adopt a working debt limit and assumes a working limit of one-quarter of one percent lower than the constitutional limit. In recent years the Governor and Legislature have adopted a working debt limit since 2003. From 2003-2009 it was 8.5% and from 2009-2013 it was 8.75%
  • Bases the limit on a prior 3-year average of General State Revenues (GSR) until July 1, 2015 and on prior 10-year average of GSR on and after July 1, 2015. The Senate version contains the same language. Current law basis the limit on a prior 3-year avarage of GSR.
  • Includes the State Property Tax in GSR beginning in FY 2016, based on a 10-year average from FY 2006 through FY 2015. The Senate version contains the same language. Current law excludes the State Property Tax from GSR.

Senate Joint Resolution now goes to the House Floor for further consideration.