Senate Moves Capital Related Jobs Bill and Public Works Bill

Posted on by

This evening the Senate took action on two capital related bills.

The Senate passed  House Bill 2561 -a.k.a. Jobs Creation Act or Dunshee’s Job Bill – with a vote of 28 to 18.

House Bill 2561 requires a ballot measure be sent to voters to authorize the issuance of $505 million in bonds to finance an array of energy efficiency improvements to public schools and buildings on public college and university campuses.

The bonds for the improvements would be funded by making permanent the proposed tax on bottled water after three years.

House Bill 2561 now goes back to the House for concurrence.

The Senate also took action on House Bill 1690 with a vote of 40-5.  House Bill 1690 clarifies that, unless otherwise specifically provided for in law, public bodies that want to use an alternative public works contracting procedure, may use only those procedures specifically authorized in chapter 39.10 RCW.

The Senate amended HB 1690 in several ways.

  • Removes direction given to the University of Washington Board of Regents to receive approval from the Capital Projects Advisory Review Board (CPARB) prior to adopting new alternative public works contracting methods.
  • Removes the authority of CPARB to approve demonstration projects and submit reports.
  • Clarifies that all housing authorities are subject to the provisions of Chapter 39.10 RCW; except where alternative requirements or procedures of federal law or federal regulation are authorized.
  • Clarifies that prevailing wage requirements (Chapter 39.12 RCW) apply to housing authority public works projects unless specifically preempted by federal law or regulation.

House Bill 1690 now goes back to the House for concurrence.

Senate Passes Revenue Legislation

Posted on by

A little past 8:30 pm this evening the Senate adopted the revenue conference report and voted to pass half of the two-bill revenue package. The Senate passed Senate Bill 6143 with a vote of 25-21.

Senate Bill 6143 modifies excise tax laws to preserve funding for public schools, colleges, and universities, as well as other public systems essential for the safety, health, and security of all Washingtonians.

Senate Bill 6143 raises $667.7 million in new revenue. Combined with the revenue expected to be generated by an increase in the cigarette tax and taxes on other tobacco products,and revenue generated from lottery revenues and the Convention and Trade Center Account the total revenue generated is expected to be $794.1 million.

Senate Bill 6143 now goes to the Governor for her signature.

House Passes 2010 Supplemental Operating Budget

Posted on by

Just after 7:00 p.m. this evening, the House passed the 2010 supplemental operating budget  (SB 6444) with a vote of 54-43.

The 2010 supplemental operating budget implements a multi-pronged approach to remedying the $2.8 billion state budget shortfall this biennium. The Legislature reduced funding for state programs and services by $755 million and incorporated approximately $618 million of approved/anticipated additional federal relief to Washington state.  In addition, the budget transfers $461 million from various funds to increase General Fund-State resources. Finally, the Legislature is expected to pass legislation that will raise $794 million in new revenues.

The House passed a single amendment on the floor. The House agreed to increase the amount provided to restore administrative reductions in the 2009-11 budget from $16. 8 million general fund to $19.1 million general funds to respond to recent job losses at the Department of Social and Health Services (DSHS).

Specifically,the increase in funding is directed towards the Department of Social and Health Services to attempt to maintain current employment levels and achieve savings through vacancies and attrition, implement efficiencies as soon as possible to minimize reductions in force, and implement a management strategy that minimizes disruption of service and negative impacts on employees.

The impact of the 2010 supplemental budget passed by the House on Evergreen is both positive and negative. The budget secures funding for student aid while at the same time reducing the College’s budget by over $1.2 million in addition to reductions to be achieved through compensation reduction related-actions.

The 2010 supplemental operating budget now goes to the Senate for concurrence.

The 2010 Supplemental Operating and Capital Budgets for Evergreen

Posted on by

The Evergreen State College, along with every other state agency in Washington, is impacted by the 2010 supplemental budgets released today by the Legislature.  For Evergreen the impact is mixed, including both reductions and investments.

2010 Supplemental Operating Budget

The supplemental operating budget released earlier today makes a strong commitment to funding programs that financially assist college students.  The operating budget in combination with revenue legislation restores funding to the State Need Grant. This funding preserves grants for 285 Evergreen students that would have been ineligible under the initial cuts proposed in the Governor’s Book 1 Budget and maintains award amounts appropriated in the 2009-11 biennial budget.  The state work study program was also reduced by 30% but not eliminated. This minimizes the impact on 162 Evergreen students who would have lost this financial resource had the program been eliminated.

The challenges and difficulties of the 2010 legislative session are still evident in changes outlined in the supplemental budget for Evergreen.  A proportion of facility maintenance costs are shifted from the operating to the capital budget ($3.247 million).  These costs will be funded with trust land revenues appropriated in the capital budget rather than with state general fund appropriations.

State funding for Evergreen was reduced by $1.291 million. This does not include a further reduction in state appropriations of $568,000 to be achieved through compensation reduction actions (SB 6503).

Apart from these reductions, Evergreen received $637,000 to provide for an increase in the monthly employer contributions for state employee health benefits. This appropriation provides for a rate increase for FY2011 from $768 to $850.

In addition, Evergreen’s Washington State Institute for Public Policy (WSIPP) was appropriated $50,000 to provide research support to the Quality Education Council.

Finally, the budget transfers $164,000 from Evergreen to South Seattle Community College (SSCC) as a part of the transfer of the Labor Center from Evergreen to SSCC. The budget also provides that at least $119,207 for FY2011 be expended on the Longhouse and $103,146 expended on the Northwest Indian Applied Research Institute.

2010 Supplemental Capital Budget

The supplemental capital budget, like the operating budget, is a mixed bag for Evergreen. The upside is that the budget provides $125,000 for a feasibility study of the College’s Biomass Gasification Project. This investment makes the state a partner along with Evergreen students and the College who also provided $125,000 each to the study through energy-related fees and energy-cost savings.

The capital budget also reflects the shift from the operating to the capital budget ($3.247 million) of facility maintenance and operations costs.

Finally, the capital budget places greater reliance on Evergreen’s local funds, including the school trust and a portion of student tuition.

An Overview of the Operating Budget as It Relates to Higher Education

Posted on by

The 2010 supplemental budget released this morning and likely to be passed by both chambers reduces funding for public services and programs by $755 million for the current biennium.

Among the reductions in the operating budget, higher education is impacted by both statewide changes and changes directed specifically towards higher education.

Statewide, the 2010 supplemental operating budget assumes $48 million in General Fund-State savings in the form of temporary state agency layoffs and management reductions (SB 6503). The Evergreen State College is reduced by a total of $568,000. This includes a reduction of $327,000 in general fund dollars and a reduction of $241,000 in non-state funds.

In addition, $30 million is expected in savings from increased efficiency in state information technology. The savings will be achieved through strategies outlined in House Bill 3178 (i.e. buying wireless service from master contracts and consolidation of email and phone services).

Specific to higher education, the budget provides funds for worker retraining, maintains much of the state funded student-financial aid programs; and minimizes reductions to colleges and universities to the extent possible.

The budget only increases funding for higher education in two areas. The budget provides $17.6 million for the Opportunity Express Account. The Account will fund an additional 3,800 full-time equivalent (FTE) unemployed workers to train at community and technical colleges for new jobs in high-demand fields.

The budget also provides $1 million to the Opportunity Express Account to provide financial aid for the additional community and technical college students who pursue training in high-demand fields.

Beyond these increases, the budget includes several budget reductions. The budget reduces state funding to the six public baccalaureate institutions and 34 community and technical colleges by an additional 6% overall for  fiscal year 2011.  The Evergreen State College was reduced by $1.291 million in addition to the reduction taken as part of the compensation-reduction bill (SB 6503).

As with implementation of the reductions in the original biennial budget, colleges and universities are expected to focus first on achieving savings through purchasing efficiencies, reduced energy use, administrative reductions, and program consolidations. The Legislature does acknowledge that the following are likely across higher education in Washington: reductions in course offerings, increases in class sizes, and reduced student support services.

The State Need Grant is maintained as enacted in the 2009-11 biennial budget. However, the State Work Study Program is reduced by approximately 30% in the second year of the biennium.  The reduction will be realized through a combination of the following: maintaining average student earnings at the current level rather than increasing them to keep pace with the estimated costs of attendance; increasing the required employer share of wages from 35% to 50% for proprietary employers and from 20% to 30% for non-profits; and discontinuing student eligibility for the program.

It should be noted that the budget assumes the passage of Senate Bill 6409 which creates the Opportunity Pathways Account and funds this account by providing that all profits from in-state lottery games are to be used for student financial aid, early childhood education, and economic development. Funds from the Opportunity Pathway Account, $73.5 million, are appropriated to replace state general fund support for the State Need Grant, the State Work Study program, Washington Scholars, and the WAVE program.

Funding for the state funded GEAR-UP project to increase college awareness and preparedness among students is also reduced by 30%.

Funding is also suspended for several state supported student aid programs.  The Legislature does continue to provide sufficient funds to complete commitments to current recipients. These programs include the Health Professional Loan & Scholarships, Education Opportunity Grants, Western Interstate Compact for Higher Education (WICHE) Professional Student Exchange program, and Future Teachers Scholarship.

The Washington Scholars and Washington Award for Vocational Excellence (WAVE) programs were not suspended but  reduced. During the 2010-11 academic year, only one student (instead of three) will be awarded scholarships equivalent to at least 90 percent of full tuition and fees at a Washington public college or university. Similar to other financial aid programs, funding will continue to be made available for current recipients who were awarded scholarships in previous years to complete their studies.

Finally, a handful of other programs were reduced or suspended. During the second year of the biennium state matching funds are not provided to support innovations in childcare delivery at public universities and funding for the Leadership 1000 project is reduced by 50%.

Two programs were suspended. State contributions for the Foster Care Endowed scholarship are suspended for the second year of the biennium. In addition, state work study for math and science is suspended.

Legislature Releases Operating and Capital Budgets: Overview

Posted on by

Late this morning the Washington Legislature released the 2010 supplemental operating (SB 6444) and capital budgets (HB 2836).

The release of the budgets was followed by a press conference with leadership from both chambers. Legislators discussed a balanced approach to remedying the $2.8 billion state budget gap, including reductions to state programs and services, one-time transfers of dollars, federal funding, and new revenue.

Legislators acknowledged that Washington has a structural problem with regard to taxes, citing the state’s regressive tax system and the narrowing limits placed on new revenue through various initiatives passed over the years. Legislators plan to continue discussions on reforms and solutions through the interim in preparation for the 2011 legislative session.

An overview of the budgets released today echoes the implementation of this multi-pronged approach to remedying the $2.8 billion state budget shortfall this biennium.

The Legislature reduced funding for state programs and services by $755 million. Among the multitude of reductions, some of the major reductions included:

  • The elimination of the remaining $79 million in Initiative 728 per student allocations to school districts;
  • Reductions in funding of $73 million to institutions of higher education near the minimum level required for the receipt of federal stimulus funds;
  • Savings of $67 million from the implementation of an additional assessment on hospitals and leveraging federal match;
  • Reductions of $49 million to all areas of state government through the requirement of temporary layoffs or salary savings;
  • Reductions of $46 million from correctional facility capacity;
  • Reductions of $30 million to reduce the grade 4 class size enhancement;
  • Savings of $30 million from information technology;
  • Reform of the Security Lifeline programs (formerly GA-U), $ 28 million
  • Savings of $15 million through the elimination of the learning improvement day for teachers.

The Legislature incorporated approximately $618 million of approved/anticipated additional federal relief to Washington State. The supplemental operating budget anticipates $480 million in additional resources based on the Federal Medical Assistance Percentage (FMAP) enhancement being extended by an additional six months through June  2011.  Congress is considering legislation that would extend the enhancements beyond the current end date, December 2010.

In addition, based on a recent U.S. Department of Health and Human Services reversal of the decision to disallow state savings from Medicare Part D “clawback” payments for prescription drugs, the state expects to receive $87 million in additional federal resources beyond the current level assumed in the state budget.

Finally, the Legislative budget offsets $39. 5 million in the Security Lifeline and Basic Health programs based on receiving a waiver allowing a portion of these state costs to be supported with federal funds; and the budget assumes additional federal resources of approximately $12 million from two smaller sources of federal aid.

The supplemental operating budget, in addition to reductions and federal funds, makes $461 million in additional transfers from various funds to increase General Fund-State resources.

Some of the larger transfers include:

  • $141 million from the Public Works Account
  • $101 million from the Education Savings Account
  • $21 million from the Job Development Account
  • $18 million from the Education Construction Account
  • $16 million from the Life Science Discovery Fund
  • $16  million from State and Local Toxics Account
  • $15 million from the Performance Audit Fund
  • $15 million from the Public Service Revolving Account
  • $12 million from the Treasury  Service Account
  • $10 million from the Savings Incentive Account
  • $10 million from the Streamlined Sales Tax Account

Finally, the Legislature plans to pass legislation that would raise $794 million with a net increase of $757 million after $12 million in legislation that decreased revenue is acknowledged. This includes:

  • $7.4 million in tax loopholes
  • $241.9 million B&O tax on service businesses
  • $59 million beer tax increase
  • $33.5 million soda/pop tax increase
  • $32.6 million bottled water tax increase
  • $101.4 million cigarette and other tobacco product tax increase
  • $10 million convention center
  • $15 million lottery marketing

The House is expected to take up the operating budget first today, followed by the Senate.

Senate Passes Cigarette Tax

Posted on by

This morning the Senate passed House Bill 2493 – the tax increase on cigarettes and other tobacco products. The House passed HB 2493 the first week of special session.

House Bill 2493 raises state cigarette taxes by $1 per pack and increases taxes on other tobacco products.

The Senate did amend the bill to change the effective date. The effective date for the changes to all tobacco products, except for moist snuff, was changed from April 1, 2010, to May 1, 2010. The changes made to the taxation of moist snuff remain effective October 1, 2010.

House Bill 2493 now goes back to the House for concurrence on the amendment to change the effective date.

Budget Deals Reached

Posted on by

Reports released this afternoon announce that the Senate and House have reached agreement on 2010 supplemental operating and capital budgets. These agreements fall on the heels of the agreement between the two chambers to raise $794.1 million in new revenue.

Final details on the budgets are expected to be released on tomorrow, Monday April 12.

Senate Ways and Means Moves Dunshee Jobs Bill

Posted on by

After a 60-day regular legislative session and nearly 30-days into the first special session of 2010, the much awaited Senate action on Representative Dunshee’s Jobs Bill occurred late this afternoon.

The Senate Ways & Means Committee held a public hearing and then moved HB 2561 out of committee to the Senate floor.

The version of House Bill 2561 passed out of the Senate Ways & Means Committee this afternoon looks different than the bill that was considered by the House at the beginning of special session.

The Committee, with support of the sponsor of the bill Rep. Dunshee, amended the bill to include a funding source. This change will require the temporary sales tax on bottled water included in the Legislature’s proposed revenue package (SB 6143) to be made permanent. After three years, tax proceeds would go toward retiring the bond debt.

In addition, prior to the bill’s enactment, a ballot measure will be sent to voters to authorize the issuance of $505 million in bonds to finance an array of energy efficiency improvements to public schools and buildings on public college and university campuses.

The newly amended House Bill 2561 authorizes nearly $350 million less than was originally discussed ($861 million). The bill also appears to focus only on K-12 and higher education buildings, setting aside for the moment eligibility for other public facilities to compete for the funds. Finally, the most recent version of the bill provides a permanent funding source for the bonds.

It is believed HB 2561 will ultimately save school districts $126 million annually in reduced operational costs and the environmental benefit would reduce harmful emissions by an amount equivalent to removing 130,000 vehicles from the road each year.

The bill, enacted, could potentially provide Evergreen with financial resources to implement energy-related projects and perhaps funding to construct Evergreen’s Biomass Gasification Project.

HB 2561 now goes to the Senate floor for further consideration.

Surprise…Votes Counted…House Passes Revenue Bill

Posted on by

This evening the House passed Senate Bill 6143, which modifies excise tax laws to preserve funding for public schools, colleges, and universities, as well as other public systems essential for the safety, health, and security of all Washingtonians.

The House passed the conference report agreement signed earlier today by the Senate and House with a vote of 52-44.

Senate Bill 6143 raises $667.7 million in new revenue. Combined with the revenue expected to be generated by an increase in the cigarette tax and taxes on other tobacco products, the total revenue generated is expected to be $794.1 million.

Senate Bill 6143 now goes to the Senate where they are expected to take action on the bill tomorrow when they convene at 2:00 p.m.

The House is adjourned until 9:00 a.m. on Monday, April 12.