The Beginning of Week Three

Posted on March 29, 2010 by garverj

While many of us on Evergreen’s campus consider today the first day of spring term, for those of us with a foot in the legislative arena it also marks the first day of week three of the first special session of 2010. Is there any end in sight?

Negotiations continue on the 2010 supplemental operating and capital budgets. Though no agreements on either budget have been finalized, the issue that has kept legislators in Olympia 15 days beyond the end of the regular session is revenue. More specifically, the sales tax and whether to increase the sales tax or not. The Senate is in favor and the House and Governor are not.

On Friday, some suggested that the Senate’s decision to move Senate Bill 6143 (revenue bill) to conference may be a small and optimistic sign towards the passage of a supplemental budget. Optimism continued to rise, when later that day in a press conference Sen. Brown eluded to looking for $200 million in taxes to replace the Senate’s proposed sales tax increase. The source of these taxes was not made clear.

Both of these moves may lead one to be more optimistic than even 48 hours ago. However, there are still many in the Senate who support a sales tax and have concerns with regard to the business tax increases, proposed by the House, that are still in the mix.

As for now, the bills needed to implement a 2010 supplemental operating budget, 2010 supplemental capital budget, and increase revenue remain where they were at the end of last week. In addition, the bills that Evergreen is tracking this special session also have not moved further in the process.

Day Twelve of Special Session; Nearing End of Week 2

Posted on March 26, 2010 by garverj

Yesterday was the first time since Monday that the Senate floor was active. Most Senators returned to Olympia for a brief floor session to concur on a handful of House bills. The House did not take any floor action.

Of most interest was the action the Senate took on Senate Bill 6143 (revenue tax bill). The Senate rejected the House’s amendments to SB 6143 and formally asked for an official Conference Committee.

In the meantime, the leadership of both chambers continue behind-the-scenes negotiations on a tax package to fund the 2010 supplemental operating budget and take action on a 2010 supplemental capital budget.

Lawmakers remain deadlocked over how to raise this revenue, the primary dividing point being the implementation of a sales tax. The Senate still supports a temporary general sales-tax increase and the House does not.

The ongoing divide between the two chambers has opened the door for “what if” conversations about concluding the session without the adoption of a budget. The state’s budget for 2009-11 is already in place (i.e. the budgets that passed at the end of the 2009 session) and a supplemental budget is not required.

These conversations, which can be recognized as still too-early conversations at this time, fail to address the state’s remaining $2.8 billion budget problem. As you may recall, State Treasurer McIntire publicly stated earlier this year that Washington is at risk of running out of “cash” by fall 2010 without new revenues or reductions in budget expenditures. At that point, Governor Gregoire would have the authority and legal obligation to implement across-the-board cuts. An option she has been public about in the last few days but does not desire.

An across-the-board reduction of state funding is not appealing to many policymakers. It is believed that such action could be as high as 20 percent to close the $2.8 billion budget gap. Some believe that yesterday’s move by the Senate to move Senate Bill 6143 to conference may be a small and optimistic sign towards the passage of a supplemental budget, only time will tell.

As for now, the bills needed to implement a 2010 supplemental operating budget, 2010 supplemental capital budget, and increase revenue remain where they were this weekend, with the execption of SB 6143 which has gone to conference. In addition, the bills that Evergreen is tracking this special session also have not moved further in the process.

What and Where are the Bills of Special Session

Posted on March 20, 2010 by garverj

The Governor, the Senate and the House all stated that the focus of the first special session of 2010 would be budgets, revenue, and job creation. While it is clear that the bills that would implement the 2010 supplemental operating and capital budgets and any revenue increases are necessary, several other bills are also required to pass to implement the budget and revenue proposals of the Legislature.

Bills, referred in the political arena as NTIB (Necessary to implement the budget), are widely defined. Many are deemed NTIB because they allow for implementation of budget policies, create cost savings, and/or are take home bills for policymakers.

During this first week of the first special session of 2010 several bills have been reintroduced that did not pass the Legislature prior to adjournment of the regular session.

A summary of the five bills Evergreen is tracking through the course of the special session are below.

House Bill 2561

House Bill 2561 authorizes the State Finance Committee to issue $861 million in general obligation bonds, to be known as Jobs Act Bonds (Act), for the purpose of creating jobs by constructing capital improvements that lead to energy-related cost savings in public schools, state colleges and universities, and other public facilities. Public schools, colleges and universities and other public facilities would compete for funds in two rounds of competitive grant funding for the dollars according to criteria laid out in the bill. The first round is dedicated solely to education and higher education.

House Bill 2561 has been referred to in the media as one of the vehicles that the Legislature may consider as part of its job creation efforts in the special session.

HB 2561 passed the House 54-39 on the second day of the special session and awaits further action in the Senate Ways & Means Committee.

House Bill 2854

House Bill 2854 determines student eligibility for the Higher Education Loan Program (HELP). To be eligible a student is defined as one that: (1) has an annual family income, adjusted for family size, that is no greater than 130 percent of the Washington median family income; (2) has completed the free application for federal student aid; (3) is a Washington resident; (4) is not enrolled in Theology as a field of study; (5) is enrolled at least half-time in a first-aid-eligible certificate or degree program up to and including graduate and professional degrees; (6) maintains satisfactory academic progress as determined by the attending institution; (7) is not delinquent or in default on a federal or state student loan; and (8) is not past due in child-support obligations.

The bill also establishes a limit on the loan amount granted per academic year is established as the cost of attendance minus any other student financial aid received.

HB 2854 passed the House 58-35 on the second day of the special session. A public hearing on the bill was held in Senate Ways & Means Committee on March 17.

House Bill 3193

House Bill 3193 reduces the bonus for National Board-certified teachers teaching in high poverty schools from $5,000 to $2,500 during the 2010-11 school year. In addition, persons receiving the National Board bonus are required to be in “instructional assignments” in a Washington public school.

HB 3193 awaits further action on the House floor.

SB 6409

Senate Bill 6409 creates the Washington Opportunity Pathways Account. Beginning in state fiscal year 2011, all net revenues from in-state lottery games that are not otherwise dedicated to debt service on the Safeco Stadium and Qwest Field and Exhibition Center are dedicated to the new account. All net income from the multi-state lottery games, other than those dedicated to the Problem Gambling Account, are deposited into the Washington Opportunity Pathways Account rather than into the General Fund.

The Washington Opportunity Pathways Account is subject to appropriation by the Legislature, and may only be used for the following programs: recruitment of entrepreneurial researchers, innovation partnership zones, and research teams; the early childhood education and assistance program (ECEAP); the State Need Grant; the State Work Study program; College Bound Scholarships; Washington Promise Scholarships; Washington Scholars; the Washington Award for Vocational Excellence (WAVE); the Passport to College Promise; the Educational Opportunity Grant; and GET Ready for Math & Science Scholarships.

SB 6409 passed the Senate 32-10 on the second day of the special session and awaits further action on the House floor.

SB 6503

Senate Bill 6503 as passed by the Senate on March 16 expresses the intention of the Legislature that state agenices and institutions of higher education reduce government operating costs. In doing so agencies and institutions of higher education are required to preserve family wage jobs. The bill further requires the following:

The Office of Financial Management (OFM) certify to each state agency the compensation reduction amount to be achieved by the executive branch agency or institution as provided in the omnibus appropriations act.
Executive branch general government state agencies and higher education institutions may submit plans that achieve compensation cost savings to OFM. The State Board for Community and Technical Colleges shall submit a single plan on behalf of all community colleges.
Compensation reduction plans submitted by higher education institutions may include leave without pay, temporary layoffs, reductions in force, reduced work hours, and voluntary retirement, separation, and other incentive programs authorized by law.
OFM shall review, approve, and submit the higher education institution plans that achieve the required cost reductions to the legislative fiscal committees. Those institutions that do not have approved plans will close on the ten dates specified in the amendment.
Legislative branch agency plans for mandatory and voluntary leave will achieve savings as provided in the omnibus appropriations act and are subject to the approval of the Chief Clerk of the House of Representatives and the Secretary of the Senate.
Judicial branch agencies will similarly submit plans for review and approval by the Supreme Court. Agency closure days will not prevent actions from being considered timely on the next business day.
Specified activities of agencies and institutions are exempt from closure or reductions. Minimal use of state employees by any agency or institution is permitted as necessary to protect public assets, protect information technology systems, and maintain public safety. For higher education classroom instruction, operations not funded from state funds or tuition, campus police and security, emergency management and response, and student health care are exempt.
The agency employing an employee not scheduled to work on an agency closure day must designate an alternative day during the same month for the employee to take temporary leave without pay.
Employees earning less than $30,000 per year may use annual leave or shared leave in lieu of a temporary layoff.
Implementation subject to bargaining will be performed consistent with applicable laws.
For state agencies, temporary layoff impacts will be negotiated between each agency and one coalition of all exclusive bargaining representatives.
For higher education institutions that have negotiations conducted by the Governor or Governor’s designee, and that have submitted a reduction plan, negotiations regarding impacts shall be conducted between coalitions of representatives at each college, college district, or university of all the exclusive representatives.
For institutions that do not submit aplan, negotiations regarding impacts shall be conducted between the Governor or Governor’s designee and one coalition of all the exclusive bargaining representatives. Institutions that do not have negotiations conducted by the Governor or Governor’s designee shall each negotiate institutional impacts.
An exception to the requirement that agencies remain open 40 hours per week is provided.
In addition to the Public Employees Retirement System provisions in current law eliminating the effect of temporary salary reductions on pension calculations (chapter 430, Laws of 2009), members of the Teachers’ Retirement System, the Public Safety Employees’ Retirement System, the Law Enforcement Officers’ and Firefighters’ Retirement System and the Washington State Patrol Retirement System will not have pension calculations reduced for salary not earned as a result of compensation reductions integral to expenditure reduction efforts.
The act contains an emergency clause and takes effect immediately.

Senate Bill was further amended on the Senate floor to:

Direct that state agencies and institutions reduce expenditures on salaries and benefits for Washington Management Service and exempt management positions by amounts provided in the omnibus appropriations act. The reductions shall be sufficient to save $10 million General Fund-State in Fiscal Year 2011
In higher education institutions, the amendment exempts student employees from the compensation reduction plans and the agency closure dates.

Special Session: Day 2

Posted on March 16, 2010 by garverj

The second day of the first 2010 special session was much more alive, actually feeling a bit like a regular session. A handful of committees held work sessions on various topics of interest and both the House and the Senate spent serious time on the floor considering legislation.

The Senate took action on eight bills today before they adjourned until 10:00 a.m. tomorrow. Of the eight bills, two are of particular interest to Evergreen.

The Senate reintroduced and passed with a vote of 30-11 Engrossed Substitute Senate Bill 6503. ESSB 6503 is the compension reduction savings bill that failed to pass the House in the regular session. The bill, which passed with a vote of 32-10 directs state agencies, including higher education institutions to achieve a $69.2 million reduction in employee compensation costs from the near General Fund through mandatory and voluntary compensation reduction activities (i.e. furloughs, leave without pay, reduced work hours, voluntary retirements and separations, layoffs, and other methods).

The second bill, which passed 32-10, Engrossed Second Substitute Senate Bill 6409 creates the Opportunity Pathways Account. Beginning in state fiscal year 2011, all net revenues from in-state lotterygames that are not otherwise dedicated to debt service on the Safeco Stadium and QwestField and Exhibition Center are dedicated to the Opportunity Pathways Account. All net income from the multi-state lottery games, other than those dedicated to the Problem Gambling Account, are deposited into the Washington Opportunity Pathways Account rather than into the General Fund.

College Promise; the Educational Opportunity Grant; and GET Ready for Math & Science Scholarships.

The House took action on 14 bills prior to adjourning until 10:00 a.m. tomorrow. Of the 14 bills passed two were of interest to Evergreen.

Engrossed House Bill 2561 authorizes the State Finance Committee to issue $861 million in general obligation bonds, to be known as Jobs Act Bonds (Act), for the purpose of creating jobs by constructing capital improvements that lead to energy-related cost savings in public schools, state colleges and universities, and other public facilities. As reported earlier through this blog, EHB 2561 passed with a close vote of 54-39.

Second Substitute House Bill 2854, which passed 58-35, creates the Higher Education Loan Program (HELP).

Finally, today, the Senate’s proposed 2010 supplemental operating budget was placed on the second reading calendar on the House floor.

Deja Vu in the Senate

Posted on March 15, 2010 by garverj

This afternoon the Senate took action on several familiar bills and then adjourned until 10:00 a.m. tomorrow.

The Senate passed 25-19 Engrossed Substitute Senate Bill 6444 (ESSB 6444) the Senate’s proposed 2010 supplemental operating budget.

Here is a refresher on the Senate’s proposed operating budget as it relates to Evergreen and other higher education priorities.

Increases health benefits and salaries by $4,000.
Appropriates $50,000 for research support to the Quality Education Council.
Reduces state funding by $1.18 million
Assumes a savings of $426,000 in compensation reduction activities.
Shifts Maintenance & & Operation (M&O) funds from the Capital budget to the Operating budget in the amount of $3.247 for Evergreen.
Restores funding to the State Need Grant
Reduces funding for public colleges and universities by $69.5 million
Increases worker retraining funds by $27.8 million
Reduces state work study by 30% in the second year of the biennium
Suspends funding for the health professional conditional scholarship and loan repayment program. Funding will continue to complete scholarship commitments to current recipients, but no new applicants will be selected.
Suspends the Educational Opportunity Grant. Funding will continue to complete grant commitments to current recipients, but no new applicants will be selected.
Continues funding to complete commitments to students who receive the Washington Scholar and Washington Award for Vocational Excellence funds but no new applicants will be selected for 2010.
Suspends the Future Teachers Scholarship. Funding will continue for current recipeints who were awarded the scholarships in prior years to complete their studies.
Suspends matching funds to support innovations in child care delivery at the public universities.
Reduces the Passport to College program by 30%
Reduces funding by 30% to the State-funded GEAR UP Projects
Suspends the Western Interstate Compact for Higher Education Professional Student Exchange program. Funding is continued to maintain commitments to current recipients
Suspends funding for state work study experience for students considering careers in math and science instruction.
Suspends the state contribution in the second year of the biennium for the Foster Care Endowed Scholarship
Suspends funding for the Leadership 1000 program

The Senate passed four other bills that were left behind upon ajdournment of the 2010 regular session. Engrossed Substitute Senate Bill 5899 provides businesses with 20 employees or less a credit against the Business and Occupation Tax for the creation of new employment positions for which the business offers a health care plan. The credits are based on the amount of wages and are capped at a maximum of $10 million per year.

Second Substitute Senate Bill 6675 creates the Washington Global Health Technologies Product Development Competitiveness Program to be administered by a Board appointed by the Governor. The Board is charged to solicit funds from businesses, foundations, and the federal government, and make grants for the development of global health technologies and products.

Substitute Senate Bill 6706 requires state universities (by definition in the bill UW and WSU) to perform one of the following: (1) Provide collaborative research and tech-transfer opportunities; (2) Make commercialization processes and resources accessible; (3) Pair researchers, entrepreneurs, and investors through workshops, events, and websites; and (4) Provide opportunities through training for direct involvement in research and industry interactions. To achieve these ends, state universities are authorized to establish and administer bridge funding programs with federal and private funds.

Senate Joint Resolution 8225 changes the definition of interest payments for calculating the state debt limit to substract direct federal subsidies.

Finally, the Senate took action to move two bills from committee to the Senate floor for further consideration during special session.

Substitute Senate Bill 6503 directs state agencies, including higher education institutions to achieve a $69.2 million reduction in employee compensation costs from the near General Fund through mandatory and voluntary compensation reduction activities (i.e. furloughs, leave without pay, reduced work hours, voluntary retirements and separations, layoffs, and other methods).

Senate Bill 6789 provides a sales and use tax exemption for eligible server equipment and power infrastructure for eligible computer data centers. In order to qualify a data center must: (1) Be located in a rural county; (2) have at least 20,000 square feet dedicated to housing servers; and (3) have commenced construction between April 1, 2010, and before July 1, 2011. The tax credit expires April 1, 2018.

Governor Convenes Special Session Beginning Monday

Posted on March 12, 2010 by garverj

This evening the Washington State Legislature adjourned the regular 2010 supplemental session. Shortly thereafter, Governor Gregoire signed a proclamation to convene a special session of the Legislature beginning Monday, March 15th.

The Governor asked Senate and House leadership to focus on reaching a compromise budget and revenue package to close the state’s $2.8 billion gap, as well as legislation to create jobs.

Gregoire is urging the House and Senate to complete their work in a seven day session. The overtime period can run up to 30 days.

Legislature Adjourns 2010 Session; Special Session Announcement Expected

Posted on March 11, 2010 by garverj

At 8:40 p.m. the Washinton State Legislature adjourned the regular 2010 supplemental legislative session. The Legislature worked tireslessly through the evening to pass several major policy bills prior to adjournment, including major K-12 reform legislation.

Despite the difficult and hard work by the Legislature to take action on several critical policy bills, the Legislature did not pass a supplemental operating budget or revenue legislation prior to adjournment this evening. The Legislature also did not pass a supplemental capital budget. In fact neither the House nor the Senate passed their proposed supplemental capital bugets off their respective floors by sine die.

An annoucement regarding the timing and focus of a special session is expected.

One Day Until Adjournment: The Latest

Posted on March 10, 2010 by garverj

With only one day to go until the Washington Legislature must adjourn the 2010 supplemental session several major pieces necessary to allow policymakers to leave Olympia without a special session remain in motion.

Here is the latest as of this evening.

Operating Budget
The 2010 supplemental operating budget (ESSB 6444) has passed both the House and Senate and is now in conference.

Capital Budget
The House proposed 2010 supplemental capital budget (HB 2836) is on the House floor waiting for further consideration. The Senate proposed 2010 supplemental capital budget (SB 6364) passed the Senate late this afternoon.

Revenue Legislation
As of this morning three revenue-related bills have made it into the end-game. Senate Bill 6143– increases taxes and closes loopholes – and Senate Bill 6874 and House Bill 2493– increases tobacco product taxes.

Senate Bill 6134 has passed both the House and Senate and is now in conference.

Senate Bill 6874 is on the House floor awaiting further consideration.

This morning House Finance Committee passed House Bill 2493 which increases cigarette tax by$1 per package and equalizes taxes on other tobacco products. HB 2493 now goes to the House floor for further consideration.

House Ways and Means Committee Moves Lottery Bill

Posted on March 10, 2010 by garverj

This afternoon the House Ways & Means Committee took action on Seante Bill 6409, the lottery bill for financial aid.

The Committee took action on a subsitute bill that greatly limited the programs that would benefit from the Washington Opportunity Pathways Account. The substitute bill replaces the language in the original bill with the following:

Expresses legislative intent to use increased lottery account revenue for stabilizing and increasing funding for higher education student financial aid.
Creates the Washington Opportunity Pathways account. Funding from the Account may only be used for the State Work Study, Opportunity Grant, Washington Scholars, Washington Award for Vocational Excellence (WAVE), State Need Grant, GET Ready for Math and Science, Passport to College, and College Bound.
Provides that all net lottery revenue not otherwise obligated for paying lottery administration, lottery prizes, debt service on Safeco Stadium, or Qwest Field and Exhibition Center, gambling education and the Education Construction Account is deposited into the Washington Opportunity Pathways Account.
Net revenues from shared lottery games that were previously directed to the state general fund are now directed to the Washington Opportunity Pathway Account.
Requires the Lottery Commission, in consultation with independent experts and the HECB, to implement strategies to actively market the state lottery as an essential contributor to Washington early education and higher education programs.
Requires the Lottery Commission to report to the appropriate committees of the Legislature on key components, performance objectives, and anticipated revenue impacts of the marketing strategies by December 1, 2010.
Requires JLARC to complete a performance review of the Lottery Commission’s marketing expenditures and incentive pay structure by November 2010.

The substitute bill removes the recruitment of entrepreneurial researchers, innovation partnership zones, and research teams as well as early childhood education and assistance program (ECAP) as programs to receive funds placed into the Washington Opportunity Pathways Accounts.

Substitute Senate Bill 6409 now goes to the House floor for further consideration.

Three Days Until Adjournment: The Latest

Posted on March 9, 2010 by garverj

With only three days to go until the Washington Legislature must adjourn the 2010 supplemental session several major pieces necessary to allow policymakers to leave Olympia without a special session remain in motion.

Here is the latest as of this morning.