Produced by the Washington State Board for Community and Technical Colleges
In this issue
Legislative News is published weekly during legislative sessions by the staff of the State Board for Community and Technical Colleges, 1300 Quince Street SE, PO Box 42495, Olympia, WA 98504-2495, telephone 360-704-4310, FAX 360-704-4415.
Curtain falls on long, difficult session
The Legislature adjourned sine die Wednesday night after passing final legislative operating and capital budgets in what was perhaps the most difficult legislative session in three decades.
Bottom line? Sacrifice.
The final version of the operating budget was the same as passed the House on Tuesday. Highlights of the final 2011-13 Legislative Operating Budget Proposal for the community and technical college system include:
State funding reduction
The final legislative budget reduces system funding by $76.8 million (11.5%) in FY 2012 and $84.3 million (12.6%) in FY 2013.
State funding drops from $669 million in the current year (including the $26 million 2011 early supplemental cut) to $592 million in FY 2012 and to $585 million in FY 2013.
The general budget reduction is $54 million in FY 2012 and $59 million in FY 2013.
The budget makes a reduction of $2 million in FY 2012 and an additional $3.5 million in FY 2013 for “efficiencies.” The budget bill directs these savings to be achieved through consolidation of college districts, consolidation of administrative and governance functions such as human resources, budget and accounting services and presidents’ offices; consolidation of student services functions and libraries; and other administrative efficiencies such as greater use of telephone and video-conferencing and reducing travel costs. A report is due to the Legislature on how the savings were achieved by December 2013.
The system enrollment target is unchanged from the current biennium at about 140,000 Full-Time Equivalent Students (FTES), a calculation of enrollment based on total credits or credit equivalents taken by all students for an academic year divided by 15.
This includes a Running Start enrollment target of 11,558 FTES, the same as the current biennium.
The budget limits state funding for Running Start students to 1.2 FTE between the high school and the college. Currently, the state funds a Running Start student for up to 1 FTE at the college and 1 FTE at the high school.
WSU and Olympic College
WSU is required to offer an additional 15 FTES in mechanical engineering at Olympic College, within existing funds.
Tuition- and financial aid-related
The budget provides authority for tuition increases of up to 12% per year for resident students and upper division applied baccalaureate tuition.
Worker Retraining and Opportunity Grants
The additional funding the system received this biennium for Worker Retraining ($17.6 million per year) and Opportunity Grants ($1 million one-time new funding) is eliminated. New additional ongoing funding for Worker Retraining is provided at $4.5 million per year for 970 FTE.
State Need Grant Funding
State Need Grant is increased to cover tuition increases, but will still not cover all the currently eligible—but un-served—students.
State Need Grant for Part-Time Students
The budget bill makes permanent the pilot project currently in place making part-time students (enrolled for three to five credits) eligible for State Need Grants. The eligibility would have expired without this language.
Funding for the Work Study program is reduced by $23.2 million for the biennium by making permanent changes made during Fiscal Year 2011, including increasing the required employer share of wages and discontinuing non-resident student eligibility for the program.
Student Achievement Initiative
The Student Achievement Initiative is provisoed $5 million for the biennium.
Applied Baccalaureate Degree Programs
Seattle Community College District and Bellevue College are authorized to offer additional applied baccalaureate degrees. Bellevue is authorized to offer degrees in information technology, health care services and management, biotechnology, and pre-professional preparation for medical fields. Seattle is authorized to offer degrees in business/international business and technology management, interactive and artistic digital media, sustainability, building science technology, and allied and global health. Bellevue and Seattle are required to develop a two-year plan for offering the new degrees to deliver to the legislature by June 30, 2012.
6% Cap on Pension Contributions
The budget cuts $8.3 million a year through limiting state contributions for higher education retirement plans to 6% of related salaries. Colleges are still legally obligated to maintain contributions above 6% for current employees, with costs shifted to local fund sources, including tuition. For example, currently, a 40-year-old faculty member in TIAA-CREF has 7.5% deducted from her salary and the state funds the 7.5% match. The 6% limit requires the college to locally fund the 1.5% difference.
Additional Charge for Supplemental Retirement Plan
House Bill 1981, as passed by the 2011 Legislature, requires an employer contribution of .25% of the salaries for employees in TIAA-CREF to be deposited into a new account that will be used to fund the supplemental retirement benefit in the future. This will drive additional system costs of about $500,000 in FY 2012 and $1 million in FY 2013. No additional funding was provided for this in the budget.
The budget allows salary and benefit savings from faculty turnover to be used to fund increments.
Health Benefit Funding
State contributions for employee health care benefits are the same as this year at $850/month. However, due to medical inflation, this is expected to represent about 85 percent of the cost, on average. Currently, the state pays 88 percent of health care costs, on average. This means employees will be paying more for health care benefits.
3% Salary Reductions
State funding is reduced by $30 million (biennial) to reflect savings from reducing employee compensation expenditures by 3% for the duration of the biennium.
While institutions are expected to reduce compensation expenditures by 3% (with one exception) higher education institutions are exempt from the 3% individual salary reductions mandated for other state employees.
The exception applies to represented community college classified staff in FY 2013 whose salary must be reduced by 3% (except for those making less than $2,500 a month). Temporary salary reduction (TSR) leave of 5.2 hours per month for a full-time employee will be earned.
This applies to positions funded from state and non-state funds.
For all other higher education employees, a 3% individual salary reduction is not required. There is an expectation that state-funded compensation costs will be reduced by 3%. This can be accomplished through various means such as permanent and temporary layoffs, reduced work hours, vacancy savings, and salary reductions. TSR leave may be provided for employees who earn leave.
Other items of interest
Life Transitions Program
Funding for the Displaced Homemakers/Life Transitions program is eliminated. This will impact eight colleges: Clark, Spokane, Olympic, Skagit, Green River, Pierce, Walla Walla, and Whatcom.
Facilities-Related Funding: Increases for leases and assessments were funded as requested. Maintenance and Operations (M&O) funding for new facilities was provided consistent with state-funded capital projects in HB 1497. The 2011 supplemental changes in the conference budget M&O funding is provided as requested for Peninsula, Columbia Basin, and South Puget Sound.
Baccalaureate tuition: Increases ranging from 11% to 16% are assumed in the budget for the baccalaureate institutions. However, under HB 1795, the institutions have unlimited authority to increase tuition. Their students will receive State Need Grants up to the increases assumed in the budget bill. The institutions must provide additional financial assistance for increases above those assumed in the budget bill.
HECB: The Higher Education Coordinating Board is eliminated in FY 2013 and two new agencies are created: the Council for Higher Education and the Office of Student Financial Assistance both created in SB 5182.
The operating budget bill now awaits the Governor’s signature. The Governor will consider vetoes and sign the budget by June 16. The State Board will make final decisions at its June 22-23 meeting on the following:
The conference capital budget provides community and technical colleges about $193.5 million in new appropriations for capital projects and follows the system’s capital projects priority list in order. A side-by-side comparison shows this budget versus the most recent House and Senate proposals and the initial system request.
The budget funds five new construction projects at 85%, subject to a 15% reduction (or $21 million) from the requested amounts:
The Senate also funded $22.8 million for Maintenance and Operation (M&O) from the building fee account.
Comparison to the rest of the state
The community and technical colleges received $149.5 million—or 15%—of the total $1.01 billion in new state construction bonds in the conference budget.
Debt Reduction Act
Unlike the Senate’s proposed Joint Resolution 8215 (which would have asked voters to constitutionally reduce the debt limit and include dedicated property taxes in the calculation of revenue), Senate Bill 5181 as passed does not require a vote of the people or address property taxes.
It puts the working debt limit into statute and starts reducing it July 1, 2015 from the current 8-3/4% by 1/4% per biennium down to 7-3/4% on July 1, 2021.
The bill also creates a 12-member “Blue Ribbon” committee to recommend improvements in state debt policies and limits, including amendments to the limits set in SB 5181 or potential constitutional changes.
One of the responsibilities of the Senate is to confirm the appointments of community and technical college trustees and members of the State Board for Community and Technical Colleges. The appointments are made by the Governor and then referred to the Senate for confirmation.
When it was all said and done, 24 two-year college trustees and two State Board members were confirmed.
Two SBCTC were confirmed: Sharon Fairchild, Liberty Lake, for a second term, and Elizabeth Chen, Federal Way, for her first term.
Trustees confirmed for a first term on local boards were Jim Lowery, Centralia College; Royce Pollard, Clark College; Jada Rupley, Clark College; Sherry Armijo, Columbia Basin College; David Mitchell, Columbia Basin College; Linda Cowan, Green River Community College; Robert Roegner, Highline Community College; Cathy McAbee, Renton Technical College; Albert Shen, Seattle Community Colleges; Bridget Piper, Community Colleges of Spokane; Elizabeth Dunbar, Tacoma Community College; Robert Ryan, Tacoma Community College; Roland Schirman, Walla Walla Community College; Kathy Small, Walla Walla Community College; June Darling, Wenatchee Valley College; and Robert Ozuna, Yakima Valley Community College
Trustees receiving confirmation for reappointments to local boards were: Quentin Powers, Edmonds Community College; Richard Van Hollebeke, Edmonds Community College; James Shipman, Everett Community College; Max Anderson, Lower Columbia College; Margaret Rojas, Skagit Valley College; Brian Vance, South Puget Sound Community College; Jim Tiffany, Wenatchee Valley; and James Carvo, Yakima Valley Community College.
Names of those trustees and State Board members not receiving confirmation this session will be automatically resubmitted for confirmation before the Senate in 2012.
Below is a recap of significant bills of interest to the community and technical college system that passed out of the Legislature and were sent to the governor for possible signature, veto, or partial veto.
In coming weeks, the system’s complete final Session Summary will be posted at the SBCTC legislative session page.
E2SHB 1371 Boards and Commissions
E2SHB 1795 Enacting the Higher Education Opportunity Act
E2SSB 1808 Launch Year Act
SHB 1822 Establishing the First Nonprofit Online University
2SHB 1909 Innovation at Community and Technical Colleges
ESHB 1981 Addressing higher education employees’ annuities and retirement income plans
ESHB 2088 Creating the Opportunity Scholarship and Opportunity Expansion Programs
E2SSB 5182 Establishing the Office of Student Financial Assistance by Eliminating the Higher Education Coordinating Board (HECB) and Transferring its Functions to Various Entities
SB 5463 Common student identifier
2SSB 5636 (Haugen) University Center of North Puget Sound
SSB 5664 Lake Washington Institute
SB 5860 State Employee Compensation
Legislative News is published weekly during legislative sessions by the staff of the State Board for Community and Technical Colleges,
1300 Quince Street SE, PO Box 42495, Olympia, WA 98504-2495, phone 360-704-4310, fax 360-704-4415. Editors: Janelle Runyon, Sherry Nelson