Tag Archives: Operating Budget

Legislature Week 8: What is Happening

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The eighth week of the 2010 supplemental session will be focused on budget and revenue.

Both the House and Senate released their proposed 2010 supplemental operating budgets this past week. The Senate has yet to release its proposed 2010 supplemental capital budget and the House has yet to release a revenue package.

Fiscal committees will be busy through Monday of next week moving the proposed budget and revenue packages forward as well as any remaining bills in their committees. Both committees must have moved bills from the opposite chamber to the floor by end of day Monday, March 1.

Tuesday through the adjournment of the 2010 supplemental session will be focused on finalizing budgets and revenue packages. So the floors of both chambers will be the center of legislative action from here on out.

Having said that it is worth keeping an eye on the House and Senate fiscal committees for a conference budget and bills (i.e. fiscal and policy) that are Necessary to Implement the Budget (NITB) (i.e. Senate Ways & Means and House Ways & Means).

It is also worth watching legislative policy committees (i.e. House Higher Education and Senate Higher Education & Workforce Development) . Many of the policy committees will hold work sessions next week on hot issues or plans for the Interim.

House Ways and Means Committee Considers Proposed Amendments to Operating Budget

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The House Ways & Means Committee held an executive session on the House’s proposed 2010 supplemental operating budget this afternoon.

The session extended into the evening as members considered 35 proposed amendments to House Bill 2824.

The committee adjourned without taking action on any of the proposed amendments or moving the bill to the House floor. No further action is scheduled for HB 2824 as of this evening.

Of the 35 amendments, six are of interest to Evergreen.

1.  Amendment 217: Provides clarifying language regarding alternate routes to teacher certification program funding. Specifies that at least 85% of endorsements be in math, science, bilingual, or special education.

2. Amendment 281: Establishes a legislative task force on four-year higher education institution affordability and access. The group will consist of one member from each caucus of both the House and Senate and will be staffed by legislative staff. The group will recommend a 10-year strategy that aligns state support, financial aid, tuition, and cost management and includes an analysis of higher education business operations and job placement and retention of graduates. The report is due to the Legislature by December 1, 2010.

3. Amendment 057: Savings from information technology savings is not to impact revenue collection efforts.

4. Amendment 362: Eliminates new transfers from capital funds to the general fund.

5. Amendment 363: Deletes the exception from the hiring freeze for positions necessary to implement legislation passed in the 2010 legislative session.

6. Amendment 025: Funding for the WorkFirst program within the Economic Services Administration in the Department of Social and Health Services is reduced by $12,729,000 and assumes that the federal 60-month lifetime limit for receipt of benefits is enforced. This amount also assumes that the deficit in the TANF program is filled as a result of this policy change.All funding for the general assistance-unemployable program ($75,621,000) in the Economic Services Administration within the Department of Social and Health Services is eliminated in fiscal year 2011.

Eliminates medical assistance for clients under the Disability Lifeline program and the Alcoholism and Drug Addiction Treatment and Support Act in the Department of Social and Health Services Medical Assistance program. Eliminates funding for the Disability Lifeline program under Substitute House Bill 2782 (security lifeline). General Fund-State funding is reduced by $107,246,000 and other funds by $41,119,000. Eliminates state-only coverage for non-citizen children and adults and reduces General Fund-State by $41,682,000.

Eliminates funding for treatment and stipends under the Alcoholism and Drug Addiction Treatment and Support Act in the Department of Social and Health Services Alcohol and Substance Abuse Program. Reduces funding for treatment for Disability Lifeline clients and removes increased funding for the Disability Lifeline program under Substitute House Bill 2782 (security lifeline act). General Fund-State funding is reduced by $15,150,000.

Eliminates the Basic Health Plan as of July 1, 2010. General Fund-State funding is reduced by $104,087,000.

Limits combined enrollment in running start programs to 1.0 FTE enrollment. The current cap for running start is 2.0 FTE. General Fund-State funding is reduced by $10,117,000.

Reduces the general fund–state appropriations in FY 2011 for the State Board for Community and Technical Colleges by $25,581,000; for the University of Washington by $8,757,000; for Washington State University by $8,021,000; for Eastern Washington University by $1,643,000; for Central Washington University by $1,587,000; for The Evergreen State College by $854,000; and for Western Washington University by $2,027,000.

Reduces the general fund–state appropriation in FY 2011 for the Higher Education Coordinating Board for the State Need Grant program by $70,082,000. Adds language to change the State Need Grant program policy by reducing the maximum award available at private and public four-year colleges to $5,000 and at private and public community and technical colleges to $2,500.

Requires the state to manage as single entity the activities of PEBB, HCA and related functions in DSHS and reduces state funding by $10,000,000.

Rejects funding for the compensation and fringe benefit provisions of the collective bargaining agreements negotiated after the 2009 legislative session and, notwithstanding provisions of Chapter 1, Laws of 2010 (Substitute Senate Bill 6382, reducing the cost of state government), or other provisions of law expands the prohibition on salary and wage increases to include employees covered by collective bargaining agreements from July 1, 2010, through the end of the biennium. Assumes savings of $9,596,000 General Fund-State and $9,526,000 other funds.

Analysis of Governor and Senate Revenue Packages

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To date the Governor and the Senate have each proposed a revenue package to accompany their proposed 2010 supplemental operating budgets. The House’s revenue package is expected any day.

The Governor was first out of the gate with her revenue package last week (February 17) for $605 million.  The Governor’s revenue package is a two-pronged approach: (1) Closing tax loopholes ($112.35 million) and (2) Increasing “sin” taxes ($493.1 million).

Governor Revenue Package

The Governor’s revenue package restores funding to a variety of public services and programs in the areas of education, health care and human services.  Specific to higher education, the Governor restores full funding to the State Need Grant.

Governor's Restoration

The Senate’s revenue package is $313 million dollars larger than the Governor’s proposed package (Total revenue increase of $918 million).

The Senate, like the Governor, targets closing tax loopholes and increasing “sin” taxes. However, the Senate only raises a single “sin” tax (i.e. cigarette tax) and also incorporates revenue from a  temporaray sales tax increase and savings from the implementation of various Senate Bills.

As eluded to above, the Senate used a four-pronged approach in the development of its revenue package: (1) Closing tax loopholes ($518 million); (2) Temporary 0.3%  increase in sales tax ($313 million); (3) Increase cigarette tax by $1 per pack ($85.7 million); and Enactment of various Senate Bills ($1.3 million).Senate Revenue SummaryThe Senate restores funding to many of the same public services and programs that the Governor’s revenue package identifies. Specific to higher education, the Senate restores full funding to the State Need Grant, restores partial funding to the State Work Study program, and maintains commitments to recipients of several smaller financial aid programs that are suspended for the second year of the biennium.

Any revenue increase proposal still has a long way to go in the legislative process before it is law. The Senate and the House must first move their revenue proposals through the appropriate committees in their respective chambers as well as the committees in the opposite chamber.

Any differences between the House and Senate proposals, after the process has been conducted, will need to be settled through conference committee and both chambers will have to concur on any final legislative revenue package.

Analysis of State Financial Aid in Budget Proposals

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The release of the House and Senate proposed 2010 supplemental budgets earlier this week reflected the hard work of the higher education sector in Washington (i.e. students, faculty, and institutions) to lobby the Washington Legislature on the importance of state financial aid to access and affordability of higher education and the state’s dedication to funding these programs.

Both chambers restored funding for the State Need Grant, restored partial funding for the State Work Study program, and maintained commitments to current recipients of several smaller grant programs.

Though the overall outcome is a positive one for state financial aid in Washington, the details between the House and Senate proposal are worth noting. 

Below is a table that summarizes the impact of the proposed operating budgets on the financial aid programs managed by the Higher Education Coordinating Board. In addition, what follows is a brief definition of the lesser known financial aid programs and the details behind the numbers for each proposal on the table. Please note that the Table is sparse regarding the Governor’s proposal. Detals are provided in the narrative that follows.

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State Work Study

 Governor
Suspends funding for this program.

Senate
Maintains average student earnings at current levels. Increases required employer share of wages to approx. 50% (formerly 35%)for proprietary employers and 30% (formerly 20%)  for non-profits . Discontinues eligibility to non-resident students.

 House
Reduces the amount of money students can earn for college in an academic year through part-time work with their wages subsidized by the state.

Washington Scholars
Provides four-year scholarships equivalent to approximately 90 percent of full tuition for three outstanding high school graduates from each legislative district each year.

Governor
Suspends funding for this program.

Senate
Does not award new scholarships for 2010 high school graduates. Freezes current award grant levels for current recipients.

Passport to College
The program includes college awareness, preparation, and mentoring for young people currently in foster care to encourage them to pursue higher education; scholarships for those who enroll in college; and incentives for their college and university to provide counseling and other supports that will enhance the young person’s success in college.

Senate
Reduces funding by one-third.

State-Funded GEAR-UP Projects
Provides pre-collegiate preparation services to students in school districts without structured college access programs.

Senate
Reduces funding by one-third.

House
Reduces funding for this program by reducing the number of school districts served by the state GEAR UP program.

WAVE (Washington Award for Vocational Excellence)
Provides two-year scholarships equivalent to full tuition for three outstanding high school vocational/technical graduates from each legislative district each year.

Senate
Does not award new scholarships for 2010 high school graduates. Freezes current award grant levels for current recipients.

Health Professional Loans & Scholarships
The loan repayment provides loan payment assistance to licensed primary care health professionals. The scholarship provides conditional scholarships to students training to become primary care health professionals. In return, program participants agree to provide primary care health care in rural or underserved urban areas with designated shortages.

Senate
Suspends funding for this program. Funding continues to be available for scholarships and three-year loan re-payment commitments awarded in previous years.

House
Reduces funding for this program. Individuals currently receiving scholarships or loan repayment benefits will continue to receive them, the number of new scholarships and loan repayment awards is reduced.

Future Teachers Scholarships
In return for conditional scholarships or loan repayments, participants agree to teach in Washington K-12 public schools. Selection criteria include academic ability, contributions to the public school system, potential to serve as a positive role model for students, length of time until completion of the education program, and commitment to serve as a Washington classroom teacher.

Governor
Suspends funding for this program.

Senate
Suspends funding for this program. Funding continues to be available for current recipients who were awarded scholarships in previous years to complete their studies.

House
Suspends funding for this program. Students currently receiving scholarships or loan repayment benefits will continue to receive them, the number of new scholarship and loan repayment awards is reduced.

Community School Matching Grants
Provides $2,000 matching awards as an incentive for non-profit, community-based organizations to raise local dollars for college student scholarships.

House
Reduces funding for this program.

Western Interstate Compact for Higher Education (WICHE) Professional Student Exchange

Senate
Suspends funding for this program. Funding is available to continue scholarship commitments to current recipients and to pay dues for Washington’s continued participating in the compact so that Washington residents may continue to receive reduced non-resident tuition rates at participating universities in other western states.

State Work Study Math and Science
Targets state work study experience for students considering careers in math and science instruction.

Senate
Suspends funding for this program.

Foster Care Endowment Scholarship
Scholarships come from the earnings from an endowment which are expected to eventually be sufficient to support college scholarships for former foster care recipients.

Senate
No contribution is made in the second year of the biennium toward an endowment fund

Leadership 1000
A College Success Foundation program that recruits private donors to sponsor scholarships and provide mentorship to financially needy students. State funding is leveraged with private donations.

Senate
Suspends funding for this program.

House
Reduces funding for this program.

Educational Opportunity Grants
Provides additional financial assistance for community and technical college graduates who would otherwise b unable to attend a distant public baccalaureate institution because of work or financial obligations in their home community.

Senate
Suspends funding for this program.  Funding continues to be available to complete scholarship commitments to current recipients, but no new applicants will be selected for the 2010-11 academic year.

State Need Grant

Governor
Reduces  Median Family Income to 50%. Prorates grant awards to serve students eligible under 50% MFI.

Senate
Proposed revenue package directs $136 million into the Education Legacy Trust Account to maintain enrollment and grant levels.

House
Reduces funding for the State Need Grant. Due to higher than anticipated federal aid allocations, the program needs less state funding in FY 2011 than previously estimated. Eligibility and grant awards are not changed. Maintains policy enacted in the 2009-11 biennial budget.

The Budgetary Impact on Evergreen

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Analysis of the Senate and House operating budgets on Evergreen continues as hundreds of pages of legislation are examined for potential impacts on the College.

In addition, efforts are underway to understand the impact of the House Capital Budget proposal on the College. The Senate Capital Budget has yet to be released.

As the impact becomes clearer over the next few days updates will be provided.

But here is what we know to date.

Operating Budget – Governor, Senate and House

Changes to the Base Budget

The Governor’s proposed supplemental budget provided Evergreen with $444,000 for health benefits and salaries.  This was reduced in the House and Senate budgets to an increase of $4,000 in each budget. 

In addition, both Chambers provided funds for additional studies to be conducted by the Washington State Institute for Public Policy. The Senate appropriates $50,000 for research support to the Quality Education Council. The House appropriates funds for three studies for a total appropriation of $125,000: (1) Examining substance abuse treatment, (2) A K-12 Study, and (3) Mental Health Assessments.

Finally, the House proposal reduces the College’s budget by $150,000 to transfer the Labor Education and Research Center from Evergreen to South Seattle Community College.

Reductions

The Governor, Senate, and House proposals all reduced state funding for Evergreen. The Governor reduces funding by $1.62 million, while the House reduces funding by $768,000 and assumes another $415,000 of additional cuts will achieved from the yet to be passed furlough bill (SB 6503). The Senate reduces state funding by $1.18 million and also assumes a savings of $426,000 from the yet to be passed furlough bill (SB 6503). Both provide flexibility to Evergreen to administer these reductions.

Fund Transfers

Both the Governor’s and the Senate’s proposed budgets shift Maintenance & Operation (M&O) funds from the Capital budget to the Operating budget. The Governor proposes a shift of $2.89 million and the House a shift of $3.247 million.  Although the House Budget doesn’t shift any expenditures to the capital program, their budget would sweep $5.9 million of our local TESC capital projects account fund balance into the State General Fund as a way to lessen overall state budget cuts.

2010 Operating Budget Comparison

Capital Budget – House

The House Capital budget reduces bond appropriations for the College’s Laboratory and Art Annex Building by $727,000.

Evergreen Testifies on Proposed Senate and House Operating Budgets

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John Hurley, Vice President for Finance and Administration, testified before the Senate Ways & Means Committee this afternoon on the Senate’s proposed 2010 supplemental operating budget.

This was  followed by testimony at an evening committee meeting on the 2010 supplemental operating budget proposed by the House.

Hurley provided similar testimony to both committees. He expressed a heartfelt thank you on behalf of the College for the restoration of the State Need Grant and investments in State Work study and other state financial aid programs. In addition, Hurley recognized the difficult climate  we as a sector and as a state find ourselves in and the work policymakers have done to maintain access and affordability for our students. Finally, he expresssed one concern regarding the shift of capital funds to the operating budget and stated that Evergreen would work with legislative staff to clarify.

House Releases Operating Budget

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This afternoon the House released their proposed 2010 supplemental operating budget.

Highlights of the proposed operating budget are below. A more detailed account of the impact of the House’s proposed 2010 supplemental budget on Evergreen will be in a blog later today.

Highlights Higher Education Budget

  • Reduces state funding for colleges and universities by $40.8 million.
  • Maintains eligibility, grant awards, and the number of students anticipated to be served by the program.
  • Reduces funding for the State Work Study by $7.7 million. To achieve this savings the money a student can earn in an academic year is reduced.
  • Reduces funding for State-funded GEAR UP projects.
  • Reduces funding for the Health Professions scholarship and loan repayment program.
  • Suspends funding for the Future Teachers Scholarship program. Continues commitment to students currently recipients of this grant.
  • Reduces funding for the Community Scholarship Matching Grant Program.
  • Reduces funding for the Leadership 1000 Scholarship Programs.

Details on the House’s proposed 2010 supplemental operating budget is located on the House Ways & Means Committee website. The House did not release a revenue package today.

Senate Releases Operating Budget and Revenue Package

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This morning the Senate released their proposed 2010 supplemental operating budget and revenue package.

Highlights of both proposals are below. A more detailed account of the impact of the Senate’s proposed 2010 supplemental budget and revenue package on Evergreen will be in a blog later today.

Highlights Higher Education Budget

  • 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.

Highlights of Revenue Package

  • Anticipates $483 milliono in additional resources based on the Federal Medical Assistance Percentage (FMAP).
  • Anticipates $87 million in additional federal resources from state savings related to Medicare Part D.
  • Assumes additional federal resources of approximately $12 million from two smaller sources of federal aid.
  • Transfers $269 million additional dollars from various funds to increase General Fund-State resources.
  • Transfers $229 million from the Budget Stabilization Account (a.k.a. Rainy Day Fund) to the state general fund. As a result there will be no ending fund balance in the Rainy Day Fund.
  • Incorporates a net increase in new revenue of $918 million. The net increase consists of three major components: (1) Narrows or eliminates numerous current tax preferences or “tax loopholes” ($518 million); (2) Impose a temporary 0.3% sales/use taxk increase ($313 million); and (3) The cigarette tax is increased by $1 per package ($86 million).

Details on the Senate’s proposed 2010 supplemental operating budget and revenue package are located on the Senate Ways & Mean’s Committee Webpage.  

Latest on State Budgets and Tuition Policy

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Tomorrow, Tuesday February 23 is a pivotal day for higher education in the 2010 supplemental legislative session.

In the morning, the Senate will release their proposed 2010 supplemental operating and capital budgets at a press conference. The press conference is scheduled for 9:00 a.m. in the Cherberg Building in Senate Hearing Room 4 and will be televised on TVW.

Following the release of the Senate proposed budgets, the House Higher Education Committee will hold a hearing on Senate Bill 6562 – the tuition policy bill.  The public hearing will take place beginning at 10:00 a.m. in Hearing Room A.

At lunch time, 12:15 p.m., the House will release their proposed 2010 supplemental operating budget in the John L. O’Brien Building in Hearing Room A.  The release of the House operating budget will also be televised on TVW.

In the afternoon, the House will release their proposed 2010 supplemental capital budget at 1:30. The budget will be released to media only but will be available along with the other proposed budgets on the Washington Legislature’s website.

Following the release of the Senate and House versions of the 2010 supplemental operating and capital budgets, public hearings will be held in the late afternoon and into the evening.

The Senate Ways & Means Committee will hold a public hearing on the Senate’s proposed operating and capital budgets in the late afternoon. The hearing is scheduled to begin at 3:30 p.m. in Senate Hearing Room 4 of the Cherberg Building.

In the early evening, the House Ways & Means Committee will hold a public hearing on the House’s proposed 2010 operating budget. The public hearing will begin at 6:00 p.m. in Hearing Room A of the John L. O’Brien Building.

At the same time, the House Capital Budget will hold a public hearing on the House’s propsoed 2010 capital budget. The public hearing will begin at 6:00 pm. in the John L. O’Brien Building in Hearing Room C 

On Wednesday, February 24 the Senate Ways & Means Committee will hold another public hearing focused on the Senate’s proposed revenue package. The public hearing will begin at 3:30 p.m. in the Cherberg Building in Senate Hearing Room 4. 

The House, at this time, is not expected to release a revenue package along with its proposed budgets.

Senate Concurs with House Version of Bill to Suspend I-960

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This evening the Senate concurred to the House amended version of Senate Bill 6130.

Senate Bill 6130 temporarily suspends tax-limiting Initiative 960 in its entirety.  The passage of the bill publicly indicates the Legislature’s intent to raise revenue in the 2009-2011 fiscal biennium.  From the effective date through July 1, 2011, any action or combination of actions by the Legislature that raises taxes may be taken with the approval of a majority of members elected to each house of the Legislature.

The final version of Senate Bill 6130 passed by both chambers reinstates the public notification requirements for tax and fee increases through July 1, 2011.

Senate Bill 6130 now goes to the Governor for her signature.