Tag Archives: Budget

A Closer Look at Higher Education in the Senate’s Proposed Biennial Budget

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The Senate Ways & Means Committee will hold a public hearing on the Senate’s proposed operating buget today (April 13) at 2:30.

The budget reduces funding for higher education by $617.5 million. This is 22.1% below the amount needed to continue the current level of programs and activities at Washington’s public higher education institutions.

In addition to these reductions the budget also eliminates the Higher Education Coordinating Board and replaces it with the Council for Higher Education and the Office of Student Financial Assistance. Finally the budget makes several changes to financial aid in Washington.

The Higher Education Sector
Of the total reduction to higher education, state funding for community and technical colleges is $200.3 million (14.4 percent) below the maintenance level and state funding for the four-year, public institutions is $417.3 million (29.8%) lower. The Evergreen State College is reduced by $14.278 million and authorized to increase tuition by 14% per year for the biennium.

In addition,  each institution’s tuition waiver authority was maintained at the level established by institution for Fiscal Year 2010.

These reductions were offset in part by tuition increases at all public higher education institutions. The proposed budget authorizes tuition increases of 16% per year for the University of Washington, Washington State University, and Western Washington University; 14% for Central Washington University and The Evergreen State College; 12% for the community and technical colleges; and 11% for Eastern Washington University.

Additionally, the Senate proposes to provide greater tuition flexibility to four-year institutions of higher education by granting full-tuition setting authority beginning in 2013-15 through 2017-19. Under this proposal institutions would be required to negotiate a performance contract with the Office of Financial Management and the Higher Education Coordinating Board if they plan to raise tuition beyond 11% at WWU, UW, and WSU or 9% at Evergreen, CWU, and EWU. In addition institutions would be required to eliminate any tuition increase beyond this threshold for those students with incomes below 125% of median family income.

The Evergreen State College
Under this proposed budget state funding for Evergreen is reduced by $14.28 million over the biennium.

  • -$12.152 million in reduced state funding which  includes the following: (1) $10.598 in reduced state funding, and (2) $1.554 million in biennialized across-the-board reductions from the December supplemental.
  • -$1.92 million to reflect a 3% salary reduction
  • -$426,000 to reflect temporary furloughs
  • $220,000 for various studies for the Washington State Institute for Public Policy

The reductions to Evergreen’s state funding were offset in part by tuition increases for the 2011-13 biennium as stated in the budget. As a result, the net cut to state funding for Evergreen is $5.78 million (-5.5%)

Higher Education Coordinating Board and Financial Aid
The Senate’s proposed budget eliminates funding for the Higher Education Coordinating Board. All funds associated with non-financial aid programs are transferred to a new state agency the Council of Higher Education (SB 5182). In addition, all funds associated with financial aid programs are transferred to a new state agency, the Office of State Financial Assistance, also established in SB 5182.

The Senate’s proposed budget provides funds to the State Need Grant and the State Work Study program to offset the cost to recipients of resident undergraduate tuition increases at each institution of higher education. Though funds are provided to offset costs to the State Work Study program, overall funding is reduced for this program.

The reductions to the State Work Study program are the result of making permanent changes made during FY 2011 including increasing the required employer share of wages and discounting non-resident student eligibility for the program.

In addition awards to students at private institutions are reduced to align with the average annual tuition increase experienced by private institutions (3.5%).

Despite the financial support for the State Need Grant and State Work Study programs, several other state financial aid programs were suspended. These programs include:

  • Health Professionals Conditional Scholarship program
  • Small grant programs including the Community Matching Grant program, WICHE student exchange, and Foster Care Endowed Scholarship
  • Future Teachers program
  • WAVE and Washington Scholars

WA Senate Release Biennial Budgets

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This evening the Washington Senate released its proposed biennial operating and capital budgets along with a supplemental budget for the current fiscal year.

2011-2103 Operating Budget
The proposed biennial budget makes approximately $4.8 billion in total reductions. The budget reduces funding for higher education by $617.5 million. Of this amount, state funding for community and technical colleges is $200.3 million (14.4 percent) below the maintenance level and state funding for the four-year, public institutions is $417.3 million (29.8%) lower. The Evergreen State College is reduced by $12.152 million and authorized to increase tuition by 14% per year for the biennium.

In addition to the reductions to higher education the proposed budget makes the following reductions to achieve a total savings of $4.8 billion.

  • $861 million – Elimination of Initiative 728
  • $212 million – Elimination of K-4 class enhancement
  • $95 million – Implementation of average daily attendance in K-12 public schools
  • $361 million – End automatic COLAs for PERS Plan 1 and TERS Plan 1
  • $428 million – 3% salary reduction to state, higher education, and K-12 employees
  • $184 millin – Reform to the Disability Lifeline cash program
  • $122 million – Reduction to Basic Health Plan
  • $110 million – Reduction in Hospital payments
  • $98 million – Reduction of 10% to Medicaid personal care hours
  • $51 million – Reduction to Disability Lifeline-Medical program

The Senate’s proposed budget also makes $455 milion in transfers from various accounts to maximize the General Fund state resources. In addition the budget assumes a net increase of $32 million in new revenues through a combination of legislation reducing revenue and legislative/budget actions increasing revenue.

2011-13 Capital Budget
The Senate’s proposed capital budget provides for $1.23 billion in bond-supported capital budget capacity for the state. The proposed capital budget is 21% smaller than the current 2009-11 biennim in total funds and a third smaller in bond funded projects.

The Senate’s proposed capital budget provides $590 million for higher education facilities. Over half of the funds go to the four-year institutions. This includes funding for Evergreen’s Communications Building and science lab renovation.

Federal Funding Legislation for Current Year Would Impact Higher Education

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Last Friday the U.S. House and Senate along with the White House agreed to a long-term continuing resolution that would fund the federal government for the remainder of FY 2011.  The deal reduces federal spending by $38.8 billion.

Congress also passed a short-term budget gap bill that expires this Thursday which will allow for time to develop the full legislation needed to implement the agreement. The short-term budget gap bills includes $2 billion in reductions.

The budget deal preserves the maximum Pell Grant but ends year-round Pell grants (See summaries posted by the House and Senate Appropriations Committees). In addition, the budget makes reductions to several research and education programs.   The bill would eliminate the Byrd Honors Scholarship Program and the Leveraging Educational Assistance Partnership (LEAP) program and reduce funding for several programs without completely eliminating them. These cuts include:

  • $20 million cut from the Federal Supplemental Education Opportunity Grants (SEOG)
  • $25 million cut from the Federal TRIO Programs
  • $20 million cut from the Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP)

The summary posted by the House Appropriations Committee also indicates a 0.2% across-the-board cut for all federal programs. It remains unclear exactly how this across-the-board cut will affect federal student aid programs.

Overall, the bill cuts federal spending by nearly $40 billion, the largest cut to federal spending in a single year. It cuts a host of education programs including Teach for America, Even Start, and Education Technology State Grants, as well as other federal programs including emergency first responders, the National Endowment for the Arts and high-speed rail. Cuts to ED programs were relatively small compared to cuts to the Departments of Transportation, Housing and Urban Development, Commerce, Justice, Labor and Health and Human Services.

Congress is expected to vote on the bill as early as Thursday.

House Votes on Operating Budget and Sends It to the Senate

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The House passed a proposed biennial operating budget on Saturday. With a vote of 53-43, the budget now goes to the Senate.

With only two weeks left in the regular 2011 legislative session, the action taken by the House this weekend moves the state closer toward closing the budget gap and heading home.

The Senate is expected to release their proposed biennial budgets on Tuesday. Also on Tuesday the House Capital Budget Committee is expected to move the House’s proposed biennial capital budget out of committee and to the floor

House Expected to Vote on Biennial Operating Budget Today

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Yesterday the House Ways & Means Committee debated amendments to the proposed biennial operating budget on the House floor. The House is expected to pass the bill some time today (Saturday April 9).
The House  adopted several amendments of which a handful impact higher education.

Among the changes made to the bill is language to eliminate a proviso dedicated to the Latino/a Educational Achievement Project (LEAP) bilingual teacher mentoring program in the amount of $75,000 in each year ($150,000 total) in the Office of the Superintendent of Instruction and redirect these funds to the  to the Professional Educator Standards Board (PESB) for alternate route and teacher recruitment programs, including pipeline for paraeducators, retooling to teach math and science, and the recruiting Washington teachers program.

In addition, lanuage was added to provide $50,000 each fiscal year out of the existing appropriation for the Office of Financial Management to contract with the Washington State Quality Award for training, outreach and assessments for public agencies and their vendors. 

The language also instructs all state agencies, except the community and technical colleges,  to track and report employees trained in performance management; provide to the Government Management and Accountability Program (GMAP), State Auditor’s Office and the Joint Legislative Audit and Review Committee copies of their Washington State Quality Award (WSQA)  assessment, and to post the results to the GMAP’s website; to integrate performance management, including the Washington State Quality Award assessment, into agencies strategic plans. The community and technical colleges were amended out of the  requirement for community colleges to conduct a full Washington State Quality Award assessment by June 30, 2013.

Finally, language was included that directs the Office of Financial Management to estimate on an annual basis the percentage of Washington households with incomes in the middle-income bracket or higher, and provide a report to the Governor and appropriate committees of the legislature and directs the Work Force Training and Education Board to include in its comprehensive plan specific strategies to increase the percentage of middle-income bracket or higher households, as calculation by the Office of Financial Management and developed by the agency or educational institution that will lead each strategy.

House Operating Budget Moves to the Floor

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Yesterday the House Ways & Means Committee moved the proposed biennial operating budget out of committee and to the House floor. The bill was approved on a vote of 16-11 in committee.

The committee adopted several amendments of which a handful impacted higher education. Among the changes was the elimination of the reserve hold back for progress on academic metrics in FY13 for all institutions.  Though the hold back remains for FY12 language was added which requires the Governor in making the determination to release these funds to make all best efforts to recognize the unique role, missions, types of communities and student populations of each institution of higher education.

In addition language was added to clarify that biennial funding for STEM enrollments for all institutions are for increased enrollments and each institution must report to the Legislature at the end of each academic year on how these funds affected STEM graduation rates.
Finally, $4.7 million was restored to the Higher Education Coordinating Board.
The budget was brought to the floor late this afternoon. It is expected that  tomorrow (Friday) the House will begin debate on amendments. Final passage of the budget proposal is planned for Saturday.  As for the Senate it is expected that they will release their budget early next week.

House Republicans Unveil Alternative State Budget

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Yesterday the House Republicans introduced an alternative biennial budget. The Republicans used thirteen principles to guide their budget decisions.

The House Republican’s proposed biennial operating budget reduces state funding for higher education by $482 million (House Democrats -$482 million).

The Higher Education Sector
The majority of the total reduction to higher education came in the form of straight-up cuts to the four-year and two-year sector- $353.8 million (House Democrates -$353.8 million). In addition, the across-the-board reductions taken during the December supplemental budget by all public higher education institiutions were biennalized and included in the 2011-13 budget – $102.2 million (House Democrats -$102.2 million). The baccalaureate institutions and the community and technical colleges were also reduced one-time to reflect the fact that enrollment levels may be temporary – $26.3 million (House Democrats -$26.3 million). Finally, waiver authority for higher education institutions was capped at actual fiscal year 2010 levels and funding was reduced to reflect the difference between previous waiver authority and actual usage of the waiver – $71.6 million (House Democrats $0). 

Finally, state funding levels were  reduced to reflect a funding cap on higher education retirement plans (HERPs) of 6% – $49.6 million (House Democrats -$57.1 million). This is recognized as savings in the proposed budget.

The reductions in the House Republican proposal were offset in part by tuition increases at all public higher education institutions. The proposed budget authorizes tuition increases of 13 percent per year for the University of Washington, Washington State University, and Western Washington University; 11.5% per year for Central Washington University, The Evergreen Staate College, and Eastern Washington University; and 11% per year for the community and technical colleges – $379 million (House Democrats $379 million).

Despite the dramatic reductions in state funding and the tuition increases, the four-year public higher education institutions received additional funding of $1.5 million for Eastern Washington University, Central Washington University, and The Evergreen State College to provide, wrap-around services for low-income students (House Democrats $1.5 million). The Republicans did not include additional funding for STEM that was part of the House Democrat’s proposal.

The Republican proposal also includes $5 million for the Baccalaureate Incentive Program. Dollars would be distributed to the four-year, public higher education institutions based on demonstrated improvement in reducing the number of credits earned by students in excess of the number needed for graduation. This was not included in the House Democrat proposal. In addition, the House Republicans did not include the required hold back of funds for demonstrated improvement in metrics which measure academic progress and completion rates that was part of the House Democratic proposal.   

The Evergreen State College
Under this proposed budget state funding for Evergreen is reduced by $15.8  million over the biennium (House Democrats -$16.3 million).   This includes a combination of reductions in state funds and policy additions:

  • -$10.31 million in reduced state funding (House Democrats -$10.38 million)
  • -$1.92 million to reflect a proposed 3% salary reduction (House Democrats -$1.92 million
  • -$1.55 million for biennialized across-the-board reductions in December supplemental (House Democrats  $1.55 million)
  • -$1.024 million as a result of the 6% funding cap on HERPs (House Democrats – $1.024 million)
  • -$940,000 in one-time reduction (House Democrats -$940,000)
  • -$698,000 to reflect increase tuition revenue from tuition waivers (House Democrats – $0)
  • $500,000 to provide for wrap-around services for low-income students (House Democrats $500,000)
  • $150,000 in various studies for the Washington State Institute for Public Policy. (House Democrats $225,000)

The reductions to Evergreen’s state funding were offset in part by tuition increases for the 2011-13 biennium as stated in the budget. As a result, the net cut state funding for Evergreen is $8.45 million (-8.1%) compared to a reduction of $9.02 million, which is a net cut of 8.6% in the Democrat’s proposal.

Financial Aid
The House Republicans maintained funding for the State Need Grant at the same level as the House Democrats ($103.1 million).

The Republican’s proposal does not make the same policy changes to the State Need Grant that the House Democrats did in their proposal. In other words the Republicans maintained awards and award sizes for students attending private non-profit and for-profit higher education institutions.

Despite the increased financial support for the State Need Grant, several state financial aid programs are suspended for the 2011-13 biennium. The one exception is State Work Study. The Republicans reduced funding for work study but do not suspend it .  Those programs suspended include:

  • Health Professionals program
  • Washington Scholars
  • Washington Award for Vocational Excellence
  • College Assistance Migrant Program
  • Community Scholarship Matching Grant Program
  • Leadership 1000
  • Western Interstate Commission for Higher Education student exchange
  • Foster Care Endowed Scholarship
  • Child Care matching grant

A Deeper Dive into the House’s Proposed Budget for Higher Education

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The proposed budget, released by the House, is expected to move out of committee tomorrow (April 6 ).

The proposed biennial operating budget reduces state funding for higher education by $482 million. In addition to these reductions the budget also makes several changes to higher education in Washington with regard to funding for high demand fields, underrepresented students, and financial aid.

The Higher Education Sector
The majority of the total reduction to higher education  came in the form of straight-up cuts to the four-year and two-year sector- $353.8 million. In addition, the across-the-board reductions taken during the December supplemental budget by all public higher education institiutions were biennalized and included in the 2011-13 budget – $102.2 million. Finally, the baccalaureate institutions and the community and technical colleges were reduced one-time to reflect the fact that enrollment levels may be temporary – $26.3 million.

Though not represented as a cut in the budget, all public higher education institutions are required to put a specified amount of state fund dollars into reserve for each year of the biennium. The Office of Financial Management may release these funds to the institution only after each institution has demonstrated improvement in metrics which measure academic progress and completion rates as determined by the Governor. The metrics will be chosen by the Governor from the National Governor’s Association’s Complete to Compete initiative.   

Finally, state funding levels were  reduced to reflect a funding cap on higher education retirement plans (HERPs) of 6% – $57.1 million. This is recognized as savings in the proposed budget.

These reductions were offset in part by tuition increases at all public higher education institutions. The proposed budget authorizes tuition increases of 13 percent per year for the University of Washington, Washington State University, and Western Washington University; 11.5% per year for Central Washington University, The Evergreen Staate College, and Eastern Washington University; and 11% per year for the community and technical colleges – $379 million.

Despite the dramatic reductions in state funding and the tuition increases, the four-year public higher education institutions received some additional funding. This funding came in two forms:

  • $1.5 million was allocated to Eastern Washington University, Central Washington University, and The Evergreen State College to provide, wrap-around services for low-income students.
  • $1.4 million was allocated to each four-year, public institutiono to support 25 full-time enrollments in the STEM fields.

The Evergreen State College

Under this proposed budget state funding for Evergreen is reduced by $16.3 million over the biennium.   This includes a combination of reductions in state funds and policy additions:

  • -$10.38 million in reduced state funding
  • -$1.97 million to reflect a proposed 3% salary reduction
  • -$1.55 million for biennialized across-the-board reductions in December supplemental
  • -$1.49 million to hold-back in reserves based upon future performance on academic progress
  • -$1.024 million as a result of the 6% funding cap on HERPs
  • -$940,000 in one-time reductions
  • $500,000 to provide for wrap-around services for low-income students
  • $250,000 to provide for 25 full-time enrollments in the STEM fields (10 enrollments in FY12 and 15 additional enrollments in FY13).
  • $225,000 in various studies for the Washington State Institute for Public Policy

The reductions to Evergreen’s state funding were offset in part by tuition increases for the 2011-13 biennium as stated in the budget. As a result, the net cut state funding for Evergreen is $9.02 million (-8.6%) (total state funding reduction minus tuition revenue).

Financial Aid
The primary victory for higher education was increased funding for the State Need Grant ($103.1 million). The increase in funding from the $91 million proposed in the Governor’s budget will accomodate the proposed budgeted tuition increases at  two-year and four-year higher education institutions. It is unclear at this time how this will impact the 22,000 current students who are eligible for the grant but do not receive it due to a lack of funds.

In addition the budget proposes two major policy changes to the State Need Grant. First, award amounts are reduced for students at private institutions. The award amount is no longer linked to tuition and fees at the UW but rather to tuition and fees at the comprehensive institutions. Second, awards are eliminated to future students who attend for-profit institutions. 

Despite the increased financial support for the State Need Grant, financial aid took a large hit in the House’s proposed budget. Several state financial aid programs are suspended for the 2011-13 biennium.  These programs include:

  • Washington’s Work Study program
  • Health Professionals program
  • Washington Scholars
  • Washington Award for Vocational Excellence
  • College Assistance Migrant Program
  • Community Scholarship Matching Grant Program
  • Leadership 1000
  • Western Interstate Commission for Higher Education student exchange
  • Foster Care Endowed Scholarship
  • Child Care matching grant
  • Educational Opportunity Grants

House Releases Budgets…Nearly A Half Billion Reduction to Higher Education

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Yesterday the Washington House released its proposed biennial operating and capital budgets along with a supplemental budget for the current fiscal year.

2011-13 Operating Budget
The proposed budget (HB 1087) makes approximately $4.4 billion in total reductions. The budget reduces funding for higher education by $482 million.  The Evergreen State College is reduced by an additional $13.9 million and authorized to increase tuition by 11.5% per year for the biennium.

Reductions greater than $50 million include:

  • $1.2 billion for I-728 and I-732
  • $482 million in a general reduction to higher education institutions (in part, offset with tuition)
  • $362 million from making changes to how certain future pension benefits are calculated for Plan 1 retirees
  • $216 million from elimination of the K-4 class size enhancement
  • $176 million from a 3 percent reduction in state employee salaries
  • $141 million from hospital rates and related changes
  • $108 million from changes to the Basic Health Plan
  • $104 million from biennializing the ESHB 1086 across-the-board reduction for higher education institutions
  • $100 million in reduced Disability Lifeline cash grants
  • $97 million for reduced personal care hours for long-term care and developmentally disabled clients
  • $89 million from a change in the Federally Qualified and Rural Health Centers payment methodology
  • $61 million from changes to the K-12 National Board Bonus program
  • $57 million from limiting state contributions to certain higher education pension costs to 6 percent
  • $56 million from freezing K-12 steps
  • $53 million from a K-12 alternative learning program funding adjustment
  • $53 million in reduced nursing home rates and quality incentive payments

The budget bill also adds approximately $500 million in policy additions, some of which are expected to achieve additional savings. Policy additions include the following items:

  • $240 million (net) repayment of the K-12 apportionment delay in the 2011 supplemental budget.
  • $103 million for the higher education State Need Grant to accommodate authorization to increase tuition.
  • $72 million in K-12 related items (mostly related to converting to a new funding formula).
  • $30 million for increased debt service.
  • $23 million related to the Special Commitment Center trials/hearings.
  • $11 million for repayment to the State Efficiency and Reorganization Account.

In addition the budget also makes the following changes, transfers, and consolidations.

  • Assumes a net receipt of $300 million to the General Fund-State from the privatization (lease) of the state liquor distribution center.
  • Assumes that higher education institutions are authorized to implement tuition increases totaling $379 million for the biennium 
  • Assumes net fund transfers into the General Fund-State of $214 million, and another $124 million by permanently consolidating certain revenue sources into the state general fund.
  • Medical Purchasing Administration: The DSHS Medical Assistance Administration becomes part of the Health Care Authority.
  • Consolidates the following into the Department of Enterprise Services: The Department of General Administration, the State Printer, and parts of the Department of Information Services, the Department of Personnel, and the Office of Financial Management are merged into the new Department of Enterprise Services. Remaining portions of the Department of Personnel and the Department of Information Services are consolidated into other agencies, including the newly created Consolidated Technology Services Agency.
  • Consolidates the Department of Heritage, Arts, and Culture: The Arts Commission, the Washington State Historical Society, the Eastern Washington Historical Society, and the Department of Archaeology and Historical Preservation are merged into the new Department of Heritage, Arts, and Culture.
  • Consolidates the Indeterminate Sentence Review Board and the Sentencing Guidelines Commission are merged into the Department of Corrections.

2009-2011 Supplemental Budget

This proposal addresses the remainder of the shortfall and leaves a projected near general fund ending balance of approximately $36 million. There are two main elements to this proposal: 

  • Incorporating the latest projection of federal rates used to match Medicaid expenditure costs, $128 million; and
  • Delaying a portion of the apportionment payments that would otherwise be made to school districts in June 2011 until July 2011.  This saves a net of $240 million in the 2009-11 biennium and increases net 2011-13 costs by an equal amount.

2011-13 Capital Budget
The proposed capital budget (HB 1497) provides for approximately $1.43 billion in bond-supported capital budget capacity for the state. Of this $801 million in bond capacity is available in FY 2012 with the balance available in FY 2013.

Approximately a quarter of the capital budget is appropriated for projects that preserve the state’s public assets through renovation, preservation, and minor works projects. Higher education received $453.2 million for major renovations, preservation, and preventative facility maintenance.

In addition the capital budget creates a $10.5 million pool of emergency funds under the Office of Financial Management to address unforseen emergency repairs at state-owned facilities statewide.

The capital buget proposes $626.7 million in total funds for higher education, including $407.6 million in state bonds.  The four-year public baccalaureate institutions receive $167.3 million in state-bonds.  This includes funding for Evergreen’s Communications Building, science lab renovation, and a predesign for the Lecture Hall.

Next Steps
The House Ways & Means Committee and the House Capital Budget Committee have scheduled actions to move both budgets from committee tomorrow. The House Ways & Means Committee will convene at 3:30 tomorrow (April 6) and the House Capital Budget Committee will convene at 1:30.