Tag Archives: Operating Budget

Washington Legislature Convenes for Special Session

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This week the Washington State Legislature convened for a 30-day special session.

Since the Legislature adjourned two weeks ago little progress has been made towards a final budget. Budget writers for each chamber did meet a few times since Sine Die, but no deal was reached. The differences between the three-corners (i.e. Governor, Senate and House) remain vast as legislators begin this next phase in the process.

Yesterday, both the Senate and the House convened to caucus. The Governor and the Senate Majority Coalition each held press conferences which echoed what has been in the atmosphere since Sine Die, no significant progress has been made; Though both shared their intention to work out a final budget within the 30-day special session.

Not much is expected this week or even next week. No floor votes are scheduled this week, but a few committees are meeting.

One bit of news is a revised special session agenda for the Governor. Governor Inslee announced a narrower focus for the next 30-days than the wide open one he declared at the end of the regular session. The top three priorities for the Governor include: a budget compromise, a new transportation revenue package, and tougher drunk driving legislation.  The Governor still hopes that action will be taken on the DREAM Act and the Reproductive Parity Act.

The 30-day special session is set to end on June 12. If a budget compromise is not reached another special session will be called.

 

Regular Session Ends; Special Session Scheduled

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The 105-day regular legislative session came to a slow end over the weekend. The Senate and House adjourned in the early evening on Sunday.

Both chambers spent the last week and the weekend moving through a series of bills deemed necessary to implement the budget -including a revenue package in the House – as well as concurrences and confirmations of gubernatorial appointments in the Senate.

Legislation that was not passed off either the Senate or the House floors will be returned to the Rules Committee in its chamber of origin as part of the close-out process for the regular session.

Legislators will not be back in town until May 13, when Governor Inslee has announced for a 30-day special session to begin. Special sessions are authorized to run for 30 days and the governor cannot limit the types of bills or topics that are considered in a special session. Usually there is agreement among the Governor’s Office and the four caucuses on what the agenda for the special session will be, but as of close of business yesterday this did not appear to be the case. 

Though Governor Inslee is hopeful that between now and May 13 budget negotiators, who will work in Olympia during this break, will have a deal come mid-May. In the Governor’s eyes the agenda would include:

  • An operating budget that makes a substantial downpayment on McCleary but not on the backs of those that are less fortunate;
  • A transportation plan that preserves funding for existing infrastructure projects and funds new projects including the new bridge across the Columbia River; and
  • Important education policy measures to ensure that new education funding will achieve results.

Governor Inslee also referenced a handful of non-budget issues that he would like to see end up on his desk at the end of the special session. Among these issues is legislation on stiffer penalties for repeat DUI offenses, gun reform, the reproductive parity act, and the state DREAM Act.

In his press conference on Sunday, Governor Inslee provided insight into the difficult tasks that lie ahead noting that lawmakers were “…aren’t miles apart. At the moment, they’re light years apart.”

Washington House Passes Revenue Package

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Late yesterday the Washington House passed a revenue package over to the Senate with a vote of 50-47.

Five Democrats joined Republicans voting against a $900 million revenue package.

The package which would raise funds for education over the next two years sets up the House’s position in budget negotiations which are expected to continue through May.

Last Major Deadline Passes, Now Its Budget Time

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On Wednesday the Legislature passed the last major deadline prior to Sine Die. As of 5:00 p.m. on April 17 all bills must have passed the opposite chamber in which they were introduced. The exception are those bills that are deemed NTIB.

Both the Senate and the House worked steadily this week towards this deadline moving hundreds of bills through the process. Some of these bills will now go back to their chamber of origin for concurrence if the bills were amended in the opposite chamber. Other bills, those that were not amended, will now be delivered to the Governor for his consideration.

This includes a handful of higher education related bills.

Bills for Concurrence

HB 1645 – Adds one public member to the Higher Education Facilities Authority.

HB 1736 –Directs the Office of Financial Management to work with institutions of higher education, the Department of Enterprise Services, the Department of Commerce, and the Department of Transportation to review the reporting requirements of institutions of higher education with the purpose of enhancing the efficiency and effectiveness of their operations, and report recommendations by December 1, 2013. Permits institutions of higher education and state higher education agencies to use or accept electronic signatures, as defined, for any human resource, benefits, or payroll processes that require a signature. Permits the Washington Student Achievement Council to negotiate and enter into interstate reciprocity agreements with other state or multistate entities regarding the operations of degree-granting institutions in the state. Permits the Washington Student Achievement Council to enter into certain agreements for the purposes of ensuring consistent.

Bills Delivered to the Governor

SB 5180 –Creates a 29-member legislative task force charged with improving access to higher education for students with disabilities. Requires the task force to make recommendations to the Legislature each December from 2013 to 2015.

SB 5195 -Allows a nonprofit institution recognized by Washington to be eligible to participate in the State Need Grant program, effective August 1, 2013.

SB 5343 -Requires institutions of higher education to provide make-up classes, exams, or other make-up events to National Guard members or other military reservists called to active duty or training for 30 days or less without prejudice to the final course grade or evaluation.

SB 5559 -Authorizes Central Washington University, The Evergreen State College, and Western Washington University to offer Educational Specialist degree.

HB 1109 – Requires institutions of higher education that offer an early course registration period for any segment of the student population to offer early registration to students who are eligible veterans or National Guard members.

Next Steps
The 2013 regular legislative session is scheduled to end at midnight on April 28. Between now and then both chambers will be working to move bills through to the Governors desk. In addition, the focus will increase around budget negotiations as the Senate, House and Governor work towards a final biennial operating and capital budget.

Washington House Releases Biennial Budget, Holds Line on Higher Education

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Today the Washington State House released a proposed biennial operating budget for the 2013-15 biennium.

In a press conference Representative Ross Hunter, Chair of the House Appropriations Committee highlighted the investments in education and critical services to Washington citizens proposed in the House budget.

Overall the proposed budget addresses the state’s $3.4 billion budget problem through policy enhancements, fund transfers, reduced spending, and increased resources.

The House proposal makes $2 billion in additional policy enhancements, the majority of which are in K-12 ($1.4 billion). Among the investments made include:

  • $986 million to K-12 to fund increased materials, supplies, and operating costs; reduce early elementary class size (K-3); fund pupil transportation and instructional hours.
  • $87 million for postsecondary education financial aid
  • $41 million for Early Childhood Education Assistance Program enhancements
  • $146 million for home care worker compensation
  • $25 million for debt service on anticipated new capital projects

These enhancements as well as the other parts of the budget are funded through a combination of savings, reduced spending, and increased resources.

  • $757 million in fund transfers including $575 million from the Budget Stabilization Account
  • $1.3 billion in reduced spending
  • $1.3 billion in increased resources

The House proposal leaves $337 million in projected total reserves.

Higher Education

The House proposal makes an investment in higher education that moves in the right direction. The budget provides $11 million in targeted funding for state instructional support and $12 million to support biofuels and clean energy programs.

The proposed budget assumes a  3% tuition increase for The Evergreen State College, Eastern Washington University, Central Washington University and the Community and Technical Colleges; and a 5% tuition increase for Western Washington University, Washington State University, and the University of Washington.

Finally the budget makes an investment in financial aid including the College Bound Scholarship program and the State Need Grant.

The House proposal continues the suspension of some small state financial aid programs from 2011-13 including suspension of Washington Scholars, WAVE, Health Professional Scholarships, and Future Teacher Scholarships.

Evergreen

For Evergreen the House’s proposed budget would allow tuition for undergraduate residents to increase by 3% per year of the biennium. The College may increase tuition beyond this level but would be required to invest in institutional financial aid.

In addition the budget appropriates $1.157 million for the purpose of instructional support. These funds include $752,000 from the proposed maintenance level appropriated to the College and $405,000 in additional funds to support this effort. Evergreen is required to provide a report by September 1, 2014 that provides the specific details on how these amoutnes were spent in the preceding fiscal year and any process changes or best-practices implemented in the College.

Finally, the Washington State Institute for Public Policy, a public service center of Evergreen, is funded to support a comprehensive study of the financial incentives promoting distributed generation in Washington.

Next Steps

The House is scheduled to hold an executive session on the proposed biennial operating budget on Thursday afternoon followed by a vote on the floor on either Friday or Saturday.

Washington Senate Releases Budget, Makes Some Investment in Higher Education

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This week  the Washington State Senate released and passed a proposed biennial operating budget for the 2013-15 biennium.

In a press conference Senator Andy Hill, Chair of the Senate Ways & Means Committee framed the budget using four numbers.

  • Zero: The deficit in the budget for the supplemental session
  • Four: The number of years the budget is balanced
  • Twenty-One:  The budget builds an education system for the 21st century
  • One-Hundred and Five: The plan to finish this work within the regular session of the Legislature.

Overall the proposed budget makes some enhancements, primarily in education; balances the budget; leaves a reserve; makes some savings; and redirects funds from the capital budget and other revenue.

The Senate proposal makes three primary enhancements in the area of education:

  • Provides funds for over $1 billion for K-12 education by continuing the phase-in of HB 2776 requirements and enhancing other basic education programs;
  • Makes over $100 million in policy level enhancements in state funding for higher education;
  • Expands preschool through the Department of Early Learning

These enhancements as well as the other parts of the budget are funded through a combination of savings, transfers, and the redirection of funds.

  • $2 billion in spending controls and savings: (1) $321 million by re-purposing Initiative 732, (2) $303 million through federal Medicaid expansion, (3) $238 million by temporarily extending the hospital safety net; (4) $151 million in administrative efficiencies (including higher education); (5) $127 million in savings by aligning health benefit eligibility for state, higher education and K-12 employees with the federal Affordable Care Act; (6) $113 million in changes to the Housing & Essential Needs (HEN) program and support for the Aged, Blind and Disabled (ABD); and (7) $183 million in caseload and policy changes affect TANF and Working Connections Child Care.
  • $179 million in transfers: The largest fund transfers include $42 million from the Life Science Discovery Fund, $20 million from the State Treasurer’s Service, and $15 million from the Public Works Assistance Account.
  • $262 million in redirection of capital budget and other revenue funds

Finally the budget assumes $61 million in new revenues. This increase includes a combination of $11 million in legislation reducing revenue and $72 million in legislation/budget actions increasing revenue.

Higher Education

The Senate proposal makes an investment in higher education that moves in the right direction. The proposed budget assumes no increases in resident undergraduate tuition rates for the 2013-15 biennium. The budget provides $77.8 million in funding to support the core academic functions of the institutions of higher education and an additional $50 million in recognition of the institutions performance in support of statewide goals relating to student retention and degree completion. Finally the budget makes an investment in financial aid including the College Bound Scholarship program and the State Need Grant.

Additional dollars are provided to WSU to expand their medical programs in Spokane and to establish the Center on Ocean pH Balance within the UW.

The investments in the Senate proposal are funded in part ($59 million) with dollars that would be generated from a 20% surcharge on international students who attend the two- and four-year public institutions.

Evergreen

For Evergreen the Senate’s proposed budget would require that tuition remain at zero for the 2013-15 biennium for undergraduate resident students. The College may increase tuition beyond this level but would be required to invest in institutional financial aid.

In addition the budget provides $1.515 million above maintenance level funding to  support the core academic functions of the institutions of higher education and $953,000  in recognition of the College’s performance in support of statewide goals relating to student retention and degree completion. Evergreen, along with the other public baccalaureate institutions, is reduced by $356,000 to meet additional administrative efficiencies.

Finally, the Washington State Institute for Public Policy, a public service center of Evergreen, is funded to support six study/research projects for the Legislature.

Next Steps

On Friday the Washington Senate passed the proposed biennial operating budget with a vote of 30-18. The vote was a mix of Democrats and Republicans. The proposal now goes to the House for consideration.

The House is expected to release their operating budget sometime this week.

Both chambers have yet to release a 2013-15 biennial capital budget.

Governor Inslee Releases Biennial Budget Priorities

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This morning Governor Inslee released his priorities for funding over the next two years. The Budget priorities call for a commitment to education and rebuilding the state’s economy while meeting obligations with targeted investments and accountability.

“Our number one priority is revitalizing Washington’s economy and building a 21st centruy workforce.  To do that, we must start with a strong commitment to education – and we must ensure that our investments get results.”

Governor Inslee identifies six budget priorities for the state:

  • Make signficant and targeted investments in education to meet our constitutional obligations under the McCleary decision
  • Step up efforts on Lean management so state agencies operate more effectively and efficiently within available resources
  • Close tax breaks whose benefits do not outweight the needs of our schoolchildren
  • Promote policies and opportunties to grow jobs
  • Prepare Washington for a vibrant, thriving economy
  • Protect vital services to seniors, children and disabled individuals

The proposal provides a path to address the state’s current $2 billion plus budget challenge, provide more than $500 million in reserves and proposes $1.2 billion as a “down payment” to meeting the state’s basic education obligations required by the McCleary ruling.

For Higher Education the proposal would fund institutions at maintenance level, increase tuition at the public baccalaureate institutions, and make a series of investments in high demand programs and financial aid.

The total proposal invests $112.9 million above maintenance level to higher education.

  • Fully funds maintenance level budgets at postsecondary institutions
  • Holds tuition at current levels for community and technical colleges and proposes a tuition increase of 3% at Evergreen and the comprehensive institutions and 5% at UW and WSU
  • Invests $11 million in a competitive enrollment pool for the public four-year institutions and a $5 million pool for the community and technical colleges
  • Expands capacity for high-cost programs at the community and technical colleges ($20 million)
  • Creates a Clean Energy Institute at the UW ($12 million)
  • Invests in WSU’s Center for Bioproducts and Biofuels ($5.2 million)
  • Increases funding for the College Bound scholarship program to meet the shortfall ($35 million)
  • Increases award amounts in the State Need Grant and Work Study programs to keep pace with the proposed tuition increases ($24.7 million)

Next week the Senate Majority Coalition is expected to release their budget followed by the House.

March Revenue Forecast Essentially Flat

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Yesterday the Washington Economic and Revenue Forecast Council released the March economic and revenue forecast.

The forecast is essentially flat. Which is good news these days. According to the report Washington is projected to take in an additional $59 million more than expected in the current fiscal year and $19 million less over the next biennium. Overall policymakers have approximately an additional $40 million to incorporate into their budget discussions.

This is good news given concerns expressed in the last few weeks about impacts on state revenue given the automatic federal budget cuts, known as sequestration, earlier this month.

Though this is a small break in what has been a stream of bad news over the last few years, it is important to note that policymakers still face a substantial budget challenge for the next two years. The Legislature must make up a shortfall of $1.3 billion and make some form of investment in basic education required by the McCleary ruling.

With the revenue forecast out, the next big step in Olympia will be the release of proposed biennial operating and capital budgets. The Senate is expected to come out with their proposed budget in the next two weeks, followed by the House. The Governor is expected to release budget priorities, not a full budget, next week sometime.

Majority Coalition Caucus Releases Higher Education Funding Proposal

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Yesterday the Senate Majority Coalition Caucus released a proposal to increase funding for higher education in Washington.

Overall the proposal would increase funding for all higher education by $300 million in the 2013-15 biennium. This is a 10% increase in funding from the 2011-13 biennium.

The increase includes a 3% decrease in student tuition costs this year, $50 million in performance funding for high demand degrees and other metrics, and an expansion of the State Need Grant program by 7% to serve an additional 4,600 FTE.

In addition by taking these actions the proposal secures GET’s future by eliminating the $621 million unfunded liability and creating a $421 million surplus.

Some of the details of the proposal are identified in Senate Bill 5883. The remaining details, such as how the baseline is defined and how the funds are split over the biennium, will be shared in the Senate’s 2013-15 biennial operating budget proposal expected in the next couple of weeks. Until all the details are known it is unclear how this proposal will impact institutions and students, including Evergreen.

Senate Bill 5883 as summarized by the Caucus:

Baseline Funding

  • Declares that institutions are legally entitled to receive a baseline level of funding
  • Directs that any ivnestments made for new programs or expansions of programs will produce a step adjustment in the per-student rates
  • Directs that any state funds above the rate needed to meet the baseline will be distributed proportionately among the two-year and four-year sectors and be used for performance
  • Declares an intent of the Legislature to, no later than April 26 2015, revisit the baseline funding levels established and determine whether any step adjustments are necessary

Performance Funding

  • Builds on the performance structure established through House Bill 1795 in 2011
  • Provides funding for the four-year public baccalaureates as specified in the state budget based on a three-year average of performance specified in metrics
  • The metrics include: (1) Average time to degree for undergraduate students, (2) Number of undergraduate high-demand degrees, (3) Freshment retention, (4) Low-income populations, and (4) Space utilization
  • Funding is awarded based on a three-year average of improved performance or for those institutions that are the highest performer in the specific metric.
  • Adds space utilization to the dashboard for the public baccalaureates
  • Repeals performance plans and other obsolete statutory language

Tuition-Setting Authority

  • Tuition setting authority for resident undergraduates is maintained through academic year 2018-19 with some changes
  • In Fiscal Years 2014 and 2015 tuition is required to be 3% lower than the tuition rates for resident undergraduates in the 2012-13 academic year and;
  • Beginning with the 2015-16 academic year tuition cannot exceed inflation except when state funding to meet the baseline is not provided. In this instance institutions are given the authority to increase resident undergraduate rates by an amount not to exceed the amount necessary to reach the baseline

Washington Releases March Caseload Forecast

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This past week the March Caseload forecast was released providing a hit to the state’s budget of $301 million, despite nearly $60 million in savings because fewer people than expected received services from an array of state programs.

The additional $301 million to the state’s budget shortfall means legislators will need to close a budget gap of approximately $1.3 billion for the 2013-15 biennium to balance the budget and maintain current service costs. This does not include additional dollars necessary for basic education that is required by the McCleary decision.

The unanticipated shortfall is primarily the result of a miscalculation of Medicaid savings and some other factors.  The miscalculation is related to a decision by the Legislature in the last budgets to move approximately 90,000 blind and disabled people on Medicaid from a fee-for-service plan to a managed-care plan. Analysts shared that the Legislature had little data to go on when it projected how much money would be saved by switching patients to managed care and the estimates turned out to be wrong.