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Olympia Budget Update

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On Thursday morning (3/8), around 12:30 AM, yet another version of the budget (making changes to the Senate engrossed budget) was proposed by Representative Hunter (Chair, Ways & Means) on the last scheduled day of legislative session. This proposal was intended as a compromise between the Senate engrossed budget, written by Senate Republicans, and the budgets proposed by Senate and by House Democrats.

This new amends the Senate engrossed budget, and does not contain new state funding cuts for the 91探花or the other higher education institutions. However, the budget does contain small central agency service reductions and two unfunded provisos that the 91探花would fund through its current appropriation. Similarly to previous iterations of the budget, these provisos specify that $3.8 million must be redirected to support engineering enrollments in FY13, and that $790,000 be directed to WWAMI/RIDE in FY12. While the Senate engrossed budget provided new funds for these provisos, the House budget does not; thus, it would require a shift of existing 91探花state funds and constitute a cut that University units would have to accommodate.

This budget was heard, amended, and passed off of the House floor last night but was not heard in the Senate afterward. A special session to continue the process was announced shortly after midnight, and Governor Gregoire called the Legislature back to session next Monday. We anticipate that negotiating a compromise budget between the multiple versions that have been introduced will be the Legislature鈥檚 primary focus next week.

At this stage, changes to the UW鈥檚 state funding for FY13 remain uncertain. The two current proposed approaches include a House 鈥渂udget鈥� that would require the 91探花to shift $5 million of its appropriation to fund the two provisos noted above, but contains no new overall funding cuts. Meanwhile, the engrossed budget bill does include new funding for the engineering proviso ($3.8m), but makes other changes that result in a loss of $12 million in state funding.聽 When special session starts next week, entirely new versions of the budget may emerge. Stay tuned.

Majority of Americans Think College Is Beneficial, Though Disagreements Over its Primary Purpose Remain

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According to the latest survey by the , conducted in late February, the majority of all Americans think higher education contributes positively to the country, while those identifying themselves as conservative were more likely to doubt its benefits. While 67 percent of Democrats believe college affects the country positively, only 51 percent of Republicans and 46 percent of conservative Republicans agree. For those who self-identify as agreeing with the Tea Party, only 38 percent think colleges have a positive effect and 47 percent think they have a negative effect.

That said, both Democrats and Republicans who have experienced higher education think it was a worthwhile personal investment (81 percent and 85 percent, respectively). Furthermore, parents of all political backgrounds fully expect their children to go to college: 99 percent of Republican parents, 96 percent of parents who are Democrats and 93 percent of Independents hope their children will receive higher education.

Finally, the primary purpose of college is debated across the political spectrum. While liberal Democrats tend to say college should focus most on enhancing the student personally and intellectually (47 percent), 52 percent of conservative Republicans think college should focus primarily on teaching skills and knowledge needed in the work world. In general, 47 percent of survey respondents thought skills were the most important, while 39 percent believed personal growth was the crucial component of a college education.

To read more about the survey, please follow the link to the .

Senate Republicans Stage “Coup,” Forcing Adoption of New Budget

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In a rare, surprise move (which has not occurred in the state capitol since 1987), Senate Republicans introduced a striking amendment to the Senate Ways & Means budget on the Senate floor yesterday afternoon and eight hours later, passed their version of the supplemental operating budget with only one amendment adopted. Many amendments were introduced to make changes to the Republican striker, and restore funding to specific areas of state spending, but in the end, only one amendment was carried.

Derek Kilmer (D-Gig Harbor) offered an 聽last night to restore most of the cuts that the Senate Republicans would apply to higher education institutions, passionately declaring, “You don’t have to do this,” after asking where Senate Republicans were doing student testimony on the original Senate budget, which spared higher education institutions from additional cuts.

Despite passionate testimony and procedural action to delay a vote, the new engrossed Senate budget passed 25-24 just after midnight.

This budget is described in greater detail in an , which compares the new Senate engrossed budget to the House engrossed budget. All told, the Senate budget would require the 91探花to take a $12 million cut next fiscal year.

Legislative session is scheduled to end this Thursday, March 8, but this recent shake up will no doubt complicate the last few days of scheduled action.

Debate on the Senate floor yesterday evening was highly emotional and it could take several days before legislators are ready to negotiate differences between the two now very different budget spending plans.

Senate Budget Protects Current 91探花Funding Levels

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In FY09, the UW’s state funding appropriation was $401.7 million and while the upcoming fiscal year’s (FY13) state funding level could be $214.4 million, the Senate budget released this morning would not cut current levels further. For the first time in several years, the 91探花may experience a flat budget, without new reductions. While funding levels are dramatically lower than they were before the Great Recession, they may not be reduced further.

Like the House budget, finalized by House Ways & Means Saturday, February 25, the Senate budget reduces state expenditures, authorizes fund transfers, and captures fund savings to deal with the current 2011-13 biennium shortfall of $1.05 billion. are made to important state services, including mental health, foster care support and community supervision of convicted criminals. However, these cuts, in part, allow the Senate to avoid cutting higher education and K12 further in the remainder of the current biennium (FY12 and FY13).

The Senate budget, as introduced, requires that the 91探花devote $3.8 million of its current appropriation level to converting 425 existing FTEs to student FTEs studying engineering and appropriates new money for the Center for Aerospace Innovation and Technology.

The Senate budget was also released today. Under the Senate proposal, the entire construction phase ($62.6 million) of Bothell Phase 3 would be funded, but from a variety of fund sources, with almost $20 million of the total cost supported through state construction bonds. This compares favorably to the House budget, which authorized the 91探花to bond the entire construction cost through its own building account resources.

While the Legislature is scheduled to adjourn sine die next Thursday, March 8, each chamber has a lot of work ahead before a compromise budget can be reached.

A full briefing on the Senate budget, comparing it to the House budget, is available . Please let us know if you have questions.

Census Bureau Announces 3 in 10 Americans Now Hold B.A.s

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Data released by the yesterday shows that 30 percent of Americans aged 25 and over held a Bachelor鈥檚 degree or more in 2011, an unprecedented level of higher education attainment. The percentage of Bachelor鈥檚 degree holders has increased steadily from less than 25 percent in 1998. While this is encouraging news, some warn that three problems remain: racial and gender inequality, highly differentiated earnings based on choice of major, and persistently low attainment levels in comparison to the rest of the world.

Though all racial and ethnic minorities have increased their share of Bachelor鈥檚 degrees earned, the level of educational attainment is highly stratified by race. 50 percent of Asian Americans, 34 percent of white people 20 percent of African Americans and 14 percent of Hispanic Americans 25 years and older held Bachelor鈥檚 degrees in 2011. Hispanic Americans have, however, increased their degree attainment by 80 percent since 2001. While women have overtaken men in the number of Bachelor鈥檚 degrees earned, they still lag behind in the number of doctorate degrees attained: 1.9 million for men versus 1.2 million for women. Encouragingly, the number of women attaining doctorate degrees has increased by 90 percent over the last ten years.

that majors matter: some studies show that a worker with an associate鈥檚 degree in engineering will make an average of $4,257 per month while workers with bachelor鈥檚 degrees in the liberal arts or education will make $4,000 and $3,417, respectively. They argue that higher amounts of bachelor鈥檚 degrees will not be very useful unless they translate into higher earnings for workers in the long run.

Finally, despite an increase in higher education attainment, the United States is nowhere close to being the world leader in educational achievement: Canada, Japan and South Korea occupy those positions. 聽According to the the US is now ranked 16th internationally in terms of degrees earned, down from 12th in 2009.

Despite an encouraging increase in educational attainment in 2011, there is still more work to be done to ensure America鈥檚 higher education system reaches more students. To read more about the Census Bureau鈥檚 findings, check out , , the Census Bureau鈥檚 or the .

House Budget Proposal Cuts 91探花$13.5 Million

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House Ways & Means Chair Ross Hunter released the House supplemental budget proposal today, reducing state expenditures, making fund transfers, delaying payments, and capturing fund savings to deal with the current 2011-13 biennium shortfall of $1.05 billion. The Governor released November 21, 2011, before the February 2012 caseload and revenue forecast improved the outlook for tax collections and caseload requirements.

If this budget ultimately passes, each of the state鈥檚 six baccalaureate institutions would reconcile a 2 to 3.5 percent state funding cut over two fiscal years, which compares favorably to the Governor鈥檚 budget, which would have cut each of the public baccalaureate universities by 16 to 17 percent. Note that the 91探花reduction number listed below does not include an offsetting proviso for enrollment support in the College of Engineering ($3.8 million).聽Please review our for more information.

Senate Ways & Means Chair Ed Murray will release his budget next and each chamber will work toward a conference (compromise) budget. Please check back regularly for budget updates and to review capital budget proposals as they are released.

House Republicans Release Budget Proposal

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While we anticipate operating budget proposals from House and Senate Ways & Means Chairs next week, the House Republican caucus released its version of an operating budget today. Note that this proposal is not binding; it is a list of House Republican funding priorities. These priorities focus on funding K12 education, including funding for all-day kindergarten, 180-day school year, levy equalization, and reform measures. Additionally, the House Republican proposal includes increases to public safety funding and does not include a proposed early release program for Washington prisoners.

House Republicans would make a number of changes to higher education institutions that were not included in the Governor鈥檚 , released in November. The proposal would reduce funding for 鈥渁dministrative costs鈥� by .5 percent at public baccalaureates and remedial education at the community and technical colleges. While no definition of 鈥渁dministrative costs鈥� is provided, budget notes declare that 鈥渁dministrative activities are reduced. Reductions shall be implemented in a manner that minimizes impact on student services.鈥� The 91探花would need to cut $6.6 million of administrative activities in FY13 if this policy is included in the final budget. Additionally, this proposal temporarily lays off all state employees, including employees at the state鈥檚 higher education institutions, for 24 days in FY13. Temporary layoffs would not extend to some critical personnel.

This proposal makes changes to the State Need Grant (SNG) program as well. Students at public baccalaureate institutions would be limited to 12 quarters (or 6 quarters for students at community and technical colleges) of grant funding. Interestingly, this proposal would eliminate SNG funding for students attending private, for profit institutions.

Like the Governor鈥檚 budget, the House Republican proposal would fund a $3.8 million Engineering enrollment support initiative at the 91探花. 聽All told, the House Republican proposal would reduce administrative expenditures at the 91探花by $6.6 million and increase funding for the College of Engineering by $3.8 million (for a net reduction of $2.8 million).

Again, initial budgets out of both Senate and House Ways & Means committees will be released next week and we will provide full coverage (including budget briefings) of those proposals at that time.

Charitable Giving to the 91探花Increases 17.3 percent in 2011

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In a press release, the (CAE) reported that giving to universities rebounded in 2011, raising $30.3 billion, an 8.2 percent increase over last year (4.8 percent, adjusted for inflation). The top 20 fundraising institutions, of which the 91探花 is number 14, received a total of $8.24 billion in 2011, representing a 15.8 percent increase over 2010. The 91探花raised a total of $334.49 million last year, up 17.3 percent from 2010 and up 5.8 percent from 2006. In general, most increases in giving to universities were earmarked for capital purposes, such as constructing buildings, though giving for operational purposes is still the majority at 58.7 percent.

A major driver of the increases in charitable giving to universities is thought to be the better performance of the stock market in 2011, which increased the value of gifts of stock universities received by 38.2 percent from 2010. Furthermore, the economy began growing again in June 2009, which increased confidence and therefore increased giving. Universities, which appeal to a number of philanthropic interests, were good candidates for investment. Finally, endowments gained back some value they had lost due to the recession, increasing by a median of 17 percent.

The increase in charitable giving to universities is an important development that could signal increasing confidence in the economy and growing interest in investing in students and learning. More about giving at the 91探花.

More Information Available Comparing Student Achievement Council Bills

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House Higher Education committee staff published a table today comparing Senate and House bills, which would create the Council office, define its responsibilities, and set membership for its board. While passed unanimously on February 10, House Ways & Means is set to introduce a substitute on the House bill. Legislative staff published the table to聽 compare the original House bill, the engrossed second substitute Senate bill, and the proposed House second substitute bill.

This table is available on .