Tag Archives: Budget

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.

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.

Budget Savings in Special Session Overestimated

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Today the Governor’s Office revised the estimated savings expected from actions taken during the special session.

The latest estimates project a reduction in the current fiscal year shortfall of approximately $700 million, instead of the $790 million reported earlier this week.

In addition, it is estimated that the across-the-board cuts enacted by the Governor as part of the deal will generate approximately $110 million in savings, instead of the $200 million previously reported.

Special Session Underway

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This morning the Washington Legislature convened the second special session of 2010. Facing a $1.2 billion budget shortfall in the current fiscal year, the Governor and the Legislature convened the special session, hopefully a single-day session, to reduce the current shortfall by hundreds of millions of dollars.

Thursday the Governor along with the four legislative caucuses reached a deal to be reached without amendments to reduce the current shortfall by $590 million.  The deal includes cuts to state programs and services, fund shifts, and additional revenue through tax compliance efforts. In addition, the Governor will implement an additional reduction of $200 million through across-the-board cutts. This brings the total budget reductions to be achieved  to $790 million.

Highlights

K-12 & Higher Education Spending Reductions – $311.4 million

  • Use of federal education dollars (Education Jobs Act) – $208 million
  • Higher education across-the-board cuts  – $51 million
  • Elimination of K-4 enhancement (effective February 1) – $39 million
  • Reduction of education reform programs – $9.2 million
  • Reduction of OSPI administration and program funding – $3.7 million

Human Services Spending Reductions – $154.1 million

  • Department of Corrections reductions – $46 million
  • Basic Health Plan Cap Trend – $27 million
  • FQHC Reimbursement Method Change – $20.3 millin
  • Reduction of Disability Lifeline Unemployable cash grant – $12.3 millin
  • Children’s Administration reductions – $11 million
  • Additional CHIPRA Performance Bonus – $10 million
  • Extension of temporary layoff to all staff (DSHS) – $9 million
  • Elimination of non-emergency adult dental  – $7 million
  • Extension of temporary layoff- adds two days (DSHS) – $4 million
  • Closure of McNeil Island – $3 million
  • Elmination of child support pass-through (Economic Services) – $1 million
  • Reduction of diversion cash assistance (TANF) – $900,000

Other Spending Changes – $24 .8 million

  • Reductions of separately elected officials, OFM & judical  – $11 million
  • Reductions Department of Natural Resources – $17 million

Fund Transfers – $54 million

  • State Toxics Control Account – $20 million
  • Disaster Response Account – $15 million
  • State Treasurer’s Service Account – $10 million
  • Financial Services Regulation Account – $5 million
  • Tobacco Prevention and Control Account – $3 million
  • Nisqually Earthquake Account – $1 million

Both the House and Senate Ways & Means Committees met this morning. The House Ways & Means Committee held a public hearing and took action on three bills:

  • House Bill 3223: 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.
  • House Bill 3224: 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

The Senate Ways & Means Committee held a public hearing and took action on two bills:

  • 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.

Both chambers are expected to take further action on the bills passed out of committee  on the House and Senate floor early this afternoon.

After today’s actions, the Governor and the Legislature will still need to resolve a remaining budget shortfall of approximately $540 million when the 2011 legislative session convenes in January.

Governor’s Budget Task Force Releases Recommendations for Change

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On Wednesday, the House Ways & Means Committee received a brief presentation regarding the recommendations put forth by the Governor’s Committee on Transforming Washington’s.

The Governor’s Office released a list of ideas representative of committee members. The ideas fall into five major catgories.

  • Restructuring Ideas
  • Budget Ideas, Cost Savings and Other Ways to Pay for Services
  • Privatization or Outsourcing Ideas
  • Better Customer Service Ideas
  • Regulatory Ideas

No votes were taken by the Committee. In addition, the recommendations provided were not developed with an  attempts to achieve consensus or to represent a majority opinion. Instead, the list contains ideas put forward by at least one of the committee members.

Several ideas were put forth that would impact the four-year higher education sector if implemented. In addition, several more would impact higher education institutions as public agencies.

Restructuring Ideas

  • Decide if four-year universities are state agencies or not. If they argencies or not. If they are agencies, then the Higher Education Coordinating Board (HECB) should become a cabinet agency with full authority over the four-years. If they aren’t agencies, funding could be switched to block performance agreements with additional funds structured around the student achievement initiative the two-years are using.

Budget Ideas, Cost Savings, and Other Ways to Pay for Services

  • Consider moving to an outcome-based funding model for higher education including: (1) Fund students on a per-credit basis rather than funding institutions; and (2) Pay for degree completions rather than student enrollment.
  • Increase tuition so students pay a higher proportion of higher education costs.
  • Negotiate master contracts and require joint purchasing of reference data bases by law libraries and higher education institutions. The state should buy in bulk in order to get better prices. Regarding law libraries – this purchasing at lower rates could also benefit county law libraries. Purchasing should allow at least some public access.
  • Limit state support to one baccalaureate degree per individual. Individuals seeking another BA degree would pay full cost of second degree.
  • Increase the building fees on student tuition – so students contribute more to the cost of higher education buildings.
  • Dedicate a portion of revenues from patents and royalties generated from research at universities and colleges to a higher education building funds.

Privatization and Outsourcing Ideas

  • Incentivize greater private higher education investment in the state. Look at options to privatize programs and components of colleges and universities. Balance with concerns regarding quality and cost-effectiveness of some of the current private for-profit programs.

The Governor will now study each of the ideas and determine which are viable either in the short or long term. Ideas that can be successfully implemented, save money, or improve the delivery of services to the people of the state will be included in the Governor’s budget proposal in December. Ideas which the Governor chooses not to pursue at this time may be picked up by members of the Legislature or others for consideration at any time.

Washington House Meets in Olympia

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On Wednesday members of the Washington House arrived in Olympia for caucus meetings and committee hearings. They are expected to be in Olympia through Friday.

Assembly Days, as they are known, kicked-off Wednesday morning with a joint hearing of the House Education Committee and House Higher Education Committee. The hearing focused on teacher preparation in Washington.

The Committee heard from a variety of individuals and organizations regarding the recruitment of teachers in Washington and math and science instruction.

Vauhn Foster-Grahler, an Evergreen faculty member and the Director of the QuaSR Center participated in a three-person panel on math and science instruction and how to improve instruction in these areas in Washington.  Foster-Grahler was joined by reprsentatives from UW-Seattle and St. Martin’s.

In the afternoon House Ways & Means held a public hearing to listen to concerns from Washingtonians regarding potential reductions to programs and services in the current fiscal year and in 2011-13.

The Committee received a brief presentation on the across-the-board cuts issued by the Governor and the recommendations of the Governor’s Committee on Transforming Washington’s Budget.

Both Committee hearings can be viewed via TVW.

Committees Review Work Completed During the Interim

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The Washington Senate arrived in Olympia yesterday. Members from both parties were in caucus or committee meetings for most of Monday and will likely do the same today.

Yesterday, the Senate Ways & Means Committee met. Committee members received budget updates and outlooks for both the operating and capital budgets.

Today, the Senate Higher Education and Workforce Development Committee met to hear several reports completed during the interim. In particular the Committee focused on:

  • An update on employment opportunities in Washington, training needs, and current training efforts from the Workforce Training Education Coordinating Board.
  • An update on the mission study, progress on applied baccalaureates, and e-learning as well as a briefing on the efficiency study work plan from the State Board for Community and Technical Colleges.
  • An update on the state’s progress toward the goals indentified in the Statewide Strategic Master Plan. Report on system design plan implementation from the Higher Education Coordinating Board.

Both Committee hearings can be viewed via TVW.

National Debt Commission Takes Vote on Proposal

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On Friday, the bipartisan National Commission on Fiscal Responsibility and Reform voted on the final proposal released earlier last week.

The proposal received 11 of 18 votes in favor of the final plan which would reduce the deficit by  nearly $4 trillion over the next decade.

Though this is too few votes to command quick action in Congress, it does constitute more votes in favor of the plan than was expected.

The Commission’s final report proposed ideas and solutions to bring the federal budget into primary balance in 2015 and improve the long-run fiscal outlook.

The Commission recommended that a cap on discretionary spending be put into place through 2020. Higher education would be impacted by this cap. The intention of this recommendation was to hold spending to 2012 or lower than 2011 spending levels and return spending to precrisis 2008 levels in real terms in 2013. In addition, the recommendation limits spending growth to half the projected inflation rate through 2020.

Another recommendation by the Commission was to eliminate the in-school interest subsidy on federal loans. This would allow for the elimination of income-based subsidies for federal student loan borrowers and better target hardship relief for loan repayment.