Tag Archives: Operating Budget

Washington House Republicans Release Education Budget Proposal

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On Thursday the Washington House Republicans released an education budget proposal that would increase funding for K-12 by $556 million. The proposal does not include any funding for higher education.

For the 2013-15 biennium the proposal would provide $903 million in education policy increases and $347 million in reductions for a net increase of $556 million.

The proposed budget would:

  • Dedicate $817 million to respond to the McCleary decision to increase basic education funding which includes expanding full-day kindergarten, reducing class sizes in kindergarten through third grade and increasing class time.
  • Provide $86 million for policy changes including funding for charter schools to support I-1240, increased levy equalization, a longitudinal data system, and a CTE correction.

The proposal also includes reductions from savings through the suspension of I-732 (COLA raises for teachers) for the biennium, changes to required assessments, reductions to hold harmless funding provided for the transition to the prototypical school funding model, and Alternative Learning Experience audit recoveries.

The proposal is the first of several budget proposals expected this legislative session. Next week the Legislature will receive the March Revenue Forecast. After that it is expected that the Senate will release their proposed biennial operating budget the last week in March or first week in April followed by the House.

Washington’s Public Four Year Institutions Release Proposal for Investment in Higher Education

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Today Washington’s public four-year universities are asking the Legislature to bolster sagging state investment in higher education in order to freeze resident undergraduate tuition for the first time in a quarter century.

The proposal asks for a $225 million investment in state funding for the 2013-15 biennium to sustain current enrollment levels and build capacity to expand access in the state’s public baccalaureate system.  In exchange the institutions would implement a tuition freeze for resident undergraduate tuition for the next two years.

This investment would support Evergreen’s basic needs and make an initial investment in sustaining and building capacity for student success. This would also provide Evergreen the necessary funds to build upon the quality of academic programs and improve student success, sustain and improve student recruitment and retention efforts through improved research capacity and investments in academic advising and financial aid as well as targeted support for entering students. In addition these funds would provide support to establish a dedicated Veterans Center at the College and increase support for the College’s science curriculum.

The investment by the state would be disbursed to the institutions on a pro-rata basis. Evergreen’s portionwould be $8.3 million.

Governor Gregoire’s Proposed 2013-15 Biennial Budgets

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On Tuesday Governor Gregoire released her proposed 2013-15 Operating and Capital budgets. As required by law, Governor Gregoire submitted an all-cuts budget that reflects existing revenues.

The all-cuts budget would reduce levy equalization by $100 million and eliminate the State Food Assistance Program and other services. In addition, higher education would receive a $52 million across-the-board cut to public universities and colleges. For Evergreen this is a reduction of $836,000 for the two-year budget.

Governor Gregoire in releasing the all-cuts budget stated it  “would have unacceptable consequences for our state and its people”. Given the drastic nature of an all-cuts budget the Governor also proposed a new revenue budget.

The new revenue operating budget proposed by the Governor relies on a combination of new revenues, program reductions, reform savings, and one-time transfers to address an anticipated $900 million shortfall in the next biennium and to take the first step towards  meeting the state’s basic education needs identified by the state Supreme Court in the McCleary decision.

Governor’s Proposed Biennial Operating Budget

The Governor’s proposed new revenue budget addresses the anticipated $900 million shortfall in 2013-15 through a combination of spending reductions, reform savings, and revenue.

The new revenue budget is balanced in large part by spending reductions and reform savings. The budget:

  • Suspends teacher cost-of-living pay raises required under Initiative 732 – $360 million
  • Delays implementation of the state’s paid family leave law – $14 million
  • Reduces funds to dozens of state programs
  • Trims funding for local government programs – $57 million
  • Assumes savings from the consolidation of “back office” functions via the consolidation of five agencies into a single agency – Department of Enterprise Services – $20 million
  • Assumes savings under the Patient Protection and Affordable Care Act (Obamacare) $140 million

In addition the budget assumes new revenue. This includes new or increased user fees, the repeal of a use tax exemption for fuel produced and used internally by extractors and manufacturers, and extends the Hospital Safety Net Assessment which is an inpatient fee that leverages increased Medicaid matching funds. Finally, the budget assumes $172 million in one-time transfers to the General Fund from a variety of accounts.

Though the new revenue budget holds the line on spending for state agencies, the budget does include some targeted investments. Among the investments is $50 million to add enrollment slots to the state’s early childhood education system, $20 million to expand STEM opportunities in higher education, and $8 million to improve prison safety.

The largest investment, however, is in K-12. The Governor’s budget represents a 12.3% increase to K-12 over the current biennium. This investment includes $1 billion – a first installment- to phase in legislation that will meet the requirements for basic education identified through the McCleary decision.

Under this legislation (HB 2776 passed in 2010) funding for K-12 would be provided to:

  • Reduce class sizes in grades K-2
  • Continue the phase-in of full-day kindergarten programs
  • Improve instructional practice through improved teacher and principal evaluations
  • Increase funding for maintenance, supplies, and operating costs
  • Fund 100% of the state’s new pupil transportation funding formula

To fund the investment in K-12, Gregoire proposes a balance between reductions in other services combined with new revenue. This would include a wholesale excise tax on gasoline and diesel fuel dedicated to pay the costs of pupil transportation services for the next three biennia and the extension of two temporary tax surcharges: (1) A 0.3% increase to the B&O tax paid by professionals (i.e. doctors, lawyers, accountants) and (2) a 50 cent per gallon beer tax.

Higher Education

The new revenue budget proposed by the Governor Gregoire provides a good starting point for budget discussions this session. Her budget builds on the momentum of the Washington Legislature in the 2012 supplemental session to stop any further erosion of state funding for higher education. The budget does not reduce funding for higher education and prohibits tuition increases for Washington’s universities and colleges. In addition the proposed budget maintains funding for the State Need Grant program.

The budget also makes a handful of investments in higher education. Among these investments is the creation of a competitive STEM enrollment pool for the public baccalaureates to compete for enrollment funds in STEM fields – $11 million; expansion of aerospace and STEM offerings at the community and technical colleges – $5 million; support for the colleges of engineering at WSU and UW – $4 million; and an increase in funding for the College Bound Scholarship program – $35 million.

The challenge for higher education under the Governor’s proposed new revenue budget is the total level of funding that is provided. While the budget proposes no reductions or ability to raise tuition, the level of funding for Washington’s public baccalaureate institutions does not meet the basic maintenance funding levels.

Evergreen

Although the Governor fully restores the temporary 3% compensation base reduction, there are no new resources provided to support increases in costs.

Under the new revenue budget, Evergreen is funded at a level that is below the maintenance level needed for the 2013-15 biennium. This means while the budget reflects the restoration of one-time transfers and reductions taken in the 2011-13 biennium, it does not reflect increases in operating costs (i.e. utility rates and collective bargaining agreements).

In addition the Governor’s proposed budget does not provide any funds to support investments requested by the College for IT and business infrastructure; student recruitment, retention and success; and faculty and staff recruitment and retention.

Capital Budget
Governor Gregoire also proposed a biennial capital budget for higher education. The Governor provided funding for a small number of projects across higher education. This includes funding for two projects at Evergreen – the renovation of the Science Lab 1 Basement and the Science Lab 2 second floor.

In addition the budget includes funding for minor works preservation and preventative maintenance.

Though the  Governor’s budget does provide some funding for minor works preservation it does not fully fund the College’s request. In addition, the proposed budget does not fund the design phase of the Lecture Hall Renovation, the predesign for the renovation of Seminar I, and the acquisition of land and design for the Tacoma Campus.

Next Steps

The Governor’s budget is the first of many budgets that will be released to address the 2013-15 biennium. While the Governor’s budget is the first step in the budget development process, there will be at least four more legislative budgets to review as the legislative session progresses.

The next budget is expected to be proposed by Governor-Elect Jay Inslee after he takes office in mid-January.

The Washington Legislature will convene on January 14 to begin its work to develop a biennial budget.  Over the next 105 days, the House and Senate will hold work sessions and public hearings on the gubernatorial proposed budgets as well as the budgets put forth by each chamber before finalizing a conference budget in late-April.

 

Special Session Moves to Week 2

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This week marks the second week of the first special session of 2012 and follows on the heels of a relatively uneventful first week.

First Week of Special Session – Recap

For the majority of the first week little was happening on The Hill. Governor Gregoire met with legislative leaders including buget negotiators, but little progress was made. Towards the end of the week things got a little more interesting.

On Thursday morning, following a budget meeting with House and Senate members, a group of Senators (Republicans and Democrats) released a new budget proposal (SB 6612). That afternoon, disappointed with the lack of progress on the budget and the release of a new proposal by a Senate coalition, the Governor pulled back on several bill signings and declared that delays and potential vetoes may take place if  no progress on the budget was made.

Second Week of Special Session Kicks-Off

Yesterday, as the second week of the special session began, budget negotiators met with the Governor’s Director of the Office of Financial Management to talk about the fundamental fiscal disagreement that separates the two camps.

The largest impasse appears to be how the House and Senate proposals suggest balancing the supplemental budget. The House passed proposal would shift approximately $330 million in current expenses to the next budget period by delaying payments to school-districts. The most recent Senate coalition proposal would delay a pension payment and balance it with pension reforms and retirement-policy changes.

Budget negotiations among legislators and the Governor’s office continued today.

Governor Suggests New Idea

In comments to reporters on Monday, the Governor hinted that she has presented a new plan to budget negotiators in an effort to break the impasse. However she did not reveal any aspects of the proposal.

It was reported that she did indicate to reporters what the plan “was not” which included  securitizing state revenues, privatizing the state lottery system, allowing slot machines in non-Indian casinos or a general increase in cigarette taxes.

House Republicans

This session each of the four caucuses issued supplemental operating budget proposals. Often the public only gets to see two proposals, one from the Senate and one from the House.

Of the four proposals released over the last month, three of the four make no cuts to K-12 or higher education. The exception being the House Republican proposal. News came forward this week that the House Republicans have announced a new supplemental plan that would make no cuts to K-12 or higher education. However, details have yet to be released.

Senate Coalition Introduces New Budget

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Last Friday Washington Senate Republicans and three Senate Democrats released a new budget proposal (SB 6612). The proposed budget is a move closer to the latest budget passed by the Washington House.

The Senate coalition announced the new proposal at a press conference after the end of the first week of special session during which negotiations were essentially non-existent.

The last proposal from the Senate coalition does include the proposal to skip a pension payment that was part of the Senate-passed budget during the regular session.  However the proposal does give some on the ending fund balance dropping the balance from $600 million to $440 million.

The new proposal restores approximately $140 million in services/programs that were reduced in the prior Senate-passed budget. The savings in large part go to buy back reductions in the original version of the proposal for higher education and K-12. As a result no cuts are made to K-12 or higher education nor does the proposal shift the school-district payment to the next biennium.

Although there was not any restoration of prior cuts enacted by the Legislature to higher education, the Senate coalition budget would make no further reductions to institutional budgets this biennium. In addition, the budget propsoal would:

  • Establish a joint legislative task force on the higher education funding formula,
  • Restore funds to student attending for-profit institutions to 100% of award levels (in the 2011-13 biennial budget the awards were reduced to 50%),
  • Allow Bellevue College and the Seattle Community College District to offer baccalaurate degrees (this proposal is also included in the House passed budget), and
  • Change state payments for public employee health benefits from $850 to $800 per month (this is included in the House passed budget).

Beyond higher education the proposal also included several reforms. The reforms include a four-year balanced budget, a constitutional amendment to lower the state’s debt limit, changes to the state’s pension system for state and education employees and retirees, consolidating the K-12 health benefits system, and repealing the voeter-approved initiatives to reduce class size and COLAs.

No further action has been scheduled to date on the new proposal.

2012 Special Session Begins

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Today the Washington Legislature convened the 2012 special session. On Friday Governor Gregoire called legislators back to Olympia at noon today to finish work on a supplemental operating and capital budget as well as the necessary policy bills needed to implement the budgets.

The special session is likely to be focused but it remains uncertain if it will go the entire thirty days. Governor Gregoire announced that she reached agreement with lawmakers to remain focused on a limited agenda, including the budgets and potentially a jobs plan that could inject $1.2 billion in state money into school construction, community projects, and environmental cleanups across the state. 

In addition a handful of other policy items may be considered, especially as vote counts are realized. Among these issues include the repeal of Initiative 728, various revenue-raising ideas, and reforms focused on a new way of budgeting and the creation of a new health-insurance pool for K-12 public school employees.

However the time it will take to reach agreement even on this limited agenda is uncertain.

Legislators left late Thursday night after failing to reach agreement on a supplemental operating budget to close the remaining $1 billion budget gap. A primary barrier to resolution during the regular session was the different approaches taken to close the budget gap. The Republicans – with support of three Senate Democrats- support skipping a penion payment and the Democrats support delaying a payment to K-12 schools.  Solving this hurdle along with a multitude of reductions and other policy changes will be the primary order of business this special session and will take time.

Progress is likely to be slow. This week it appears the House is not scheduled to convene and the Senate is scheduled only for pro forma sessions until Wednesday when a possible session is scheduled. In the meantime the Governor has indicated her desire to begin to set up negotiations between the “five corners” – meaning the Governor’s Office and the leaders of the Democratic and Republican caucuses in the House and Senate.

House Committee Moves 2012 Supplemental Operating Budget

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On Saturday members of the House Ways & Means Committee took action on the Washington House’s proposed 2012 Supplemental Operating Budget.

The budget, as passed by the Committee, made several changes to multiple parts of the budget. Overall the budget passed by the Committee provides for an additional $54.9 million above the budget originally proposed by the House Democrats.

With regard to higher education, the budget as passed by the Committee makes the following changes:

  • Eliminates funding for the STEM Degree Incentive Program in the Student Achievement Council (the new HECB entity) and redirects the funds by appropriating them directly to Eastern Washington University, Western Washington University, Central Washinton University, and The Evergreen State College. The amendment requires that the funds appropriated to the universities and college are to be used only for direct costs of instruction associated with this enrollment expansion
  • Requires the student achievement council (new HECB entity) to convene the Higher Education Loan Program Work Group. Requires the Work Group to develop methods for funding the loan program in the future as well as recommendations regarding the best loan program structure for providing financial aid to underserved populations. Sets out certain factors that the Work Group must take into account in making their recommendations. Provides a due date for the resulting report of December 1, 2012 and appropriates $50,000 for this purpose.

The House’s proposed 2012 Supplemental Operating Budget will now move to the House Floor for consideration.

Washington House Republicans Release 2012 Supplemental Operating Budget

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On Friday, the Washington House Republicans released its proposed supplemental operating  budget for the remainder of the biennium.

2012 Supplemental Operating Budget Proposal
The proposed supplemental budget makes approximately $840 million in state funding reductions. The budget leaves $651 million in reserves and does not put forth a revenue package.

The budget reduces funding for higher education by $105.3 million. Of this amount, state funding for community and technical colleges is reduced by $14.5 million and state funding for the four-year, public institutions is $15 million lower. The Evergreen State College is reduced by $541,000.

The majority of the reductions to higher education come through policy changes to state funded financial aid programs. The State Need Grant program is reduced by $75.8 million. This reduction is achieved by altering eligibilty guidelines in two ways. First awards for students attending baccalaureate institutions are limited to 12 quarters (4 years) and for students attending two-year institutions their awards are limited to 6 quarters (2 years). In addition only those students who file their Federal Application for Federal Financial Aid (FAFSA) by the March 15th deadline would be eligible to receive a State Need Grant.

In addition the proposed budget would restore funding to private, for-profit institutions, previously reduced in the 2011 biennial budget. Finally the proposed budget maintains current funding for the state work study program and eliminates funding for remedial education for those under 20 at community colleges.

The proposed budget would also reduce state employee monthly health benefit funding rates form $850 to $800 ($33.1 million) and institute 24 days of furlough for all state employees, including those at higher education institutions, beginning July 1, 2012 ($91 million). The exception to the furloughs would be any state employees working for critical services such as corrections and hospitals.

In addition to the reductions to higher education the proposed budget makes the following reductions to achieve a total savings of $840 million.

  • Reduces funding to the Department of Ecology by 14%
  • Eliminates all general fund spending for the Puget Sound Partnership
  • Makes $33 million in administrative efficiencies in information technology, goods and services, personal service contracts, travel, equipment and cell phones.
  • Reduces most general government agencies by 5-10%

The House Republican’s budget proposal will be followed by a proposal put forth by the House Democrats on February 21. The Senate’s proposed operating budget is expected to follow next week.

 

Special Session Begins Today

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Today at Noon lawmakers will return to Olympia to begin a thirty-day special session focused on closing a $2 billion budget shortfall. The first week of the special session is packed full of work sessions and public hearings on the state budget.

November 28
The House Ways & Means Committee will hold a public hearing on the Governor’s proposed supplemental budget.

November 29
The House will convene for a floor session to take action on some early bills. On the Senate side the Ways & Means Committee will hold a work session on the Governor’s proposed supplemental budget. In addition a handful of Senate policy committees will convene.

November 30
Both the House and Senate will convene for a floor session. In addition policy committees in both chambers will meet. Finally the Senate Ways & Means Committee will hold a public hearing on the K-12 and higher education portions of the Governor’s supplemental budget.

December 1
Several appropriation and policy committees will convene. Of particular interest to higher education will be:

  •  A work session of the Senate Higher Education & Workforce Development Committee on the Governor’s proposed supplemental budget for higher education, a report on the GET program, and a report from the Higher Education Steering Committee tasked with developing a new state-level higher education entity.  
  • The House Capital Budget Committee will convene a work session that will focus in part on the ten-year capital needs of higher education institutions. 
  • The House Ways & Means Committee will hold a work session on the November economic and revenue forecast, the budget outlook for 2012 and the impact of recently passed initiatives on the operating budget.

December 2
The House Higher Education Committee will convene for a work session on the legislative priorities of the Higher Education Coordinating Board (HECB), State Board for Community and Technical Colleges, Workforce Training and Education Coordinating Board, and the Public Baccaluareate Institutions. In addition the Committee will receive reports regarding the Higher Education Steering Committee’s work on a new state-level entity for higher education, the HECB’s work on the higher education master plan, and the community and technical colleges’ efficiencies efforts.

Finally the House Ways & Means Committee will convene to hold a public hearing on any bills referred to committee.

 

 

 

Senate Passes Operating and Capital Budgets; Budgets Now Head to Governor

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This evening the Washington Senate passed the conference operating and capital budgets for the 2011-13 biennium. 

2011-2103 Operating Budget
The Senate passed the operating buget with a vote of 34-13. The conference biennial budget addresses a $4.9  billion shortfall, making approximately $4.5 billion in policy level reductions. The budget reduces funding for higher education institutions by $535 million.  The Evergreen State College is reduced by $12.152 million and authorized to increase tuition by 14% per year for the biennium.

In addition the budget maintains the state need grant to offset budgeted tuition increases to students and reduces, but does not eliminate , state work study.

Bond Bill

With a vote of 46-1, the Senate passed legislation (HB 2020)  to provide $1.4 billion in new state general obligation bonds to support the 2011 Supplemental and 2011-13 Capital Budget. In addition the bill reduces 2011 Supplemental bond appropriations by $32 million.

Capital Budget

With a vote of 47-0, the Senate passed the 2011-13 capital budget (HB 1497). The  2011-13 Capital Budget authorizes $3.1 billion in new capital projects, of which $1.4 billion are financed with new state general obligation bonds.

It is the combination of HB 1497 and HB 2020 that will provide the funds to support Evergreen’s capital projects