2605-S

AN ACT Relating to higher education; amending RCW 43.88.150, 41.06.380, 28B.15.013, 28B.15.067, 28B.15.076, 28B.15.556, 28B.15.725, 28B.15.740, and 28B.80.330; amending 1989 c 290 s 1 (uncodified); reenacting and amending RCW 43.88.110, 28B.15.031, 28B.15.202, 28B.15.402, and 28B.15.820; adding a new section to chapter 28B.10 RCW; adding a new section to chapter 41.06 RCW; adding new sections to chapter 28B.15 RCW; adding a new section to chapter 28B.80 RCW; and repealing RCW 41.06.382.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. A new section is added to chapter 28B.10 RCW to read as follows:

It is the policy of the state of Washington that:

(1) By the year 2002, Washington's system of higher education and work force training will be among the five best in the country in providing access and programs of the highest quality to the residents of the state of Washington;

(2) By the year 2002, the level of state general fund appropriations per student attending state universities, regional universities, The Evergreen State College, and the community and technical colleges will equal or exceed the ninetieth percentile of state appropriations for students attending each institution's peers. Any increased funding required to meet the goal may be phased over six years, beginning in the 1995-1997 biennial budget;

(3) Peer institutions for each four-year institution of higher education and the community and technical college system will be determined by the higher education coordinating board, in consultation with the institutions, the office of financial management, and the house of representatives and senate higher education and fiscal committees;

(4) Beginning with the 1995-1997 biennium, the legislature intends, each biennium, to appropriate to each state university, regional university, and The Evergreen State College, the same amount of state general fund dollars appropriated the previous biennium, adjusted for inflation, one-time costs, and other policy initiatives adopted by the legislature. Most new enrollments will be reserved for resident students;

(5) In the biennial budget for four-year institutions of higher education, the legislature will adopt a minimal number of provisos, and will not adopt salary restrictions for employees of state universities, regional universities, or The Evergreen State College;

(6) In selecting institutions of higher education to provide educational programs or services, the higher education coordinating board will consider public and independent institutions that, through a competitive process, commit to providing the most cost-effective, high quality program or service for Washington residents, in addition to other conditions that may be required by the board;

(7) Four-year institutions of higher education will be relieved from laws and rules governing state agencies if those laws inhibit the institutions from operating in the most effective manner, and the institutions meet other accountability measures as adopted by law; and

(8) Washington residents who have prepared themselves for college and who desire postsecondary education and training will not be denied an education due to their financial status.

Sec. 2. RCW 43.88.150 and 1991 c 284 s 3 are each amended to read as follows:

(1) For those agencies that make expenditures from both appropriated and nonappropriated funds for the same purpose, the governor shall direct such agencies to charge their expenditures in such ratio, as between appropriated and nonappropriated funds, as will conserve appropriated funds. This subsection does not apply to institutions of higher education as defined in RCW 28B.10.016.

(2) Unless otherwise provided by law, if state moneys are appropriated for a capital project and matching funds or other contributions are required as a condition of the receipt of the state moneys, the state moneys shall be disbursed in proportion to and only to the extent that the matching funds or other contributions have been received and are available for expenditure.

(3) The office of financial management shall adopt guidelines for the implementation of this section. The guidelines may account for federal matching requirements or other requirements to spend other moneys in a particular manner.

NEW SECTION. Sec. 3. A new section is added to chapter 41.06 RCW to read as follows:

(1) An institution of higher education may purchase services by contract with individuals, businesses, or nonprofit entities.

(2) An institution of higher education's decision to contract out that results in layoff of one or more employees classified under this chapter shall be in accordance with the following criteria:

(a) The institution of higher education has conducted an analysis to determine that contracting out will result in:

(i) Cost savings; or

(ii) Efficiencies; or

(iii) Increased revenue in self-sustaining operations.

(b) A contract to purchase services shall provide that the contractor will pay to its employees performing the contract work wages that are similar to those generally paid for such work in the locality in which the work is to be performed and will provide health benefits that are not less than the benefits provided for basic health care services under chapter 70.47 RCW. Contractors with employees who have health benefits from other sources are exempt from this subsection.

(c) An institution of higher education shall use a procurement process consistent with chapter 43.19 RCW, and shall notify the affected union representative of its plans not less than thirty calendar days before initiating the procurement process. The certified bargaining representative has the right to offer alternatives to the proposed contract. Contracts must provide for efforts to meet or exceed agency affirmative action employment goals as well as agency established contract goals for participation by minority and women business enterprises consistent with chapter 39.19 RCW.

(d) A contract to purchase services shall provide a hiring preference to any employee laid off from a position that is contracted out, for a period of one year following the layoff.

(3) Nothing in this section may be construed to modify, reduce, or otherwise affect the purchase of services that were authorized to be purchased by contract under this chapter before the effective date of this section.

Sec. 4. RCW 41.06.380 and 1979 ex.s. c 46 s 2 are each amended to read as follows:

Nothing contained in this chapter shall prohibit any department, as defined in RCW 41.06.020, from purchasing services by contract with individuals or business entities if such services were regularly purchased by valid contract by such department prior to April 23, 1979: PROVIDED, That no such contract may be executed or renewed by departments other than institutions of higher education as defined in RCW 28B.10.016 if it would have the effect of terminating classified employees or classified employee positions existing at the time of the execution or renewal of the contract.

Sec. 5. RCW 43.88.110 and 1991 sp.s. c 32 s 27 and 1991 c 358 s 2 are each reenacted and amended to read as follows:

This section sets forth the expenditure programs and the allotment and reserve procedures to be followed by the executive branch for public funds.

(1) Allotments of an appropriation for any fiscal period shall conform to the terms, limits, or conditions of the appropriation.

(2) The director of financial management shall provide all agencies with a complete set of operating and capital instructions for preparing a statement of proposed expenditures at least thirty days before the beginning of a fiscal period. The set of instructions need not include specific appropriation amounts for the agency.

(3) Within forty-five days after the beginning of the fiscal period or within forty-five days after the governor signs the omnibus biennial appropriations act, whichever is later, all agencies shall submit to the governor a statement of proposed expenditures at such times and in such form as may be required by the governor.

(4) Except as provided in subsection (9) of this section, the office of financial management shall develop a method for monitoring capital appropriations and expenditures that will capture at least the following elements:

(a) Appropriations made for capital projects including transportation projects;

(b) Estimates of total project costs including past, current, ensuing, and future biennial costs;

(d) Comparisons of estimated construction start and completion dates with actual dates;

(e) Documentation of fund shifts between projects.

This data may be incorporated into the existing accounting system or into a separate project management system, as deemed appropriate by the office of financial management.

(5) If at any time during the fiscal period the governor projects a cash deficit in a particular fund or account as defined by RCW 43.88.050, the governor shall make across-the-board reductions in allotments for that particular fund or account so as to prevent a cash deficit, unless the legislature has directed the liquidation of the cash deficit over one or more fiscal periods. Except for the legislative and judicial branches and other agencies headed by elective officials, the governor shall review the statement of proposed operating expenditures for reasonableness and conformance with legislative intent. Once the governor approves the statements of proposed operating expenditures, further revisions shall be made only at the beginning of the second fiscal year and must be initiated by the governor. However, changes in appropriation level authorized by the legislature, changes required by across-the-board reductions mandated by the governor, changes caused by executive increases to spending authority, and changes caused by executive decreases to spending authority for failure to comply with the provisions of chapter 36.70A RCW may require additional revisions. Revisions shall not be made retroactively. Revisions caused by executive increases to spending authority shall not be made after June 30, 1987. However, the governor may assign to a reserve status any portion of an agency appropriation withheld as part of across-the-board reductions made by the governor and any portion of an agency appropriation conditioned on a contingent event by the appropriations act. The governor may remove these amounts from reserve status if the across-the-board reductions are subsequently modified or if the contingent event occurs. The director of financial management shall enter approved statements of proposed expenditures into the state budgeting, accounting, and reporting system within forty-five days after receipt of the proposed statements from the agencies. If an agency or the director of financial management is unable to meet these requirements, the director of financial management shall provide a timely explanation in writing to the legislative fiscal committees.

(6) Except as provided in subsection (9) of this section, it is expressly provided that all agencies shall be required to maintain accounting records and to report thereon in the manner prescribed in this chapter and under the regulations issued pursuant to this chapter. Within ninety days of the end of the fiscal year, all agencies shall submit to the director of financial management their final adjustments to close their books for the fiscal year. Prior to submitting fiscal data, written or oral, to committees of the legislature, it is the responsibility of the agency submitting the data to reconcile it with the budget and accounting data reported by the agency to the director of financial management.

(7) Except as provided in subsection (9) of this section, the director of financial management shall monitor agency operating expenditures against the approved statement of proposed expenditures and shall provide the legislature with quarterly explanations of major variances.

(8) The director of financial management may exempt certain public funds from the allotment controls established under this chapter if it is not practical or necessary to allot the funds. With the exception of exemptions that may be granted to four-year institutions of higher education, allotment control exemptions expire at the end of the fiscal biennium for which they are granted. The director of financial management shall report any exemptions granted under this subsection to the legislative fiscal committees.

(9) In consultation with four-year institutions of higher education, the higher education coordinating board, and the house of representatives and senate fiscal committees, the director of the office of financial management shall develop and implement a simplified allotment and reporting procedure for the state universities, regional universities, and The Evergreen State College. The procedure may exempt the four-year institutions of higher education from allotment controls required for public funds.

Sec. 6. RCW 28B.15.013 and 1989 c 175 s 79 are each amended to read as follows:

(1) The establishment of a new domicile in the state of Washington by a person formerly domiciled in another state has occurred if such person is physically present in Washington primarily for purposes other than educational and can show satisfactory proof that such person is without a present intention to return to such other state or to acquire a domicile at some other place outside of Washington.

(2) Unless proven to the contrary it shall be presumed that:

(a) The domicile of any person shall be determined according to the individual's situation and circumstances rather than by marital status or sex.

(b) A person does not lose a domicile in the state of Washington by reason of residency in any state or country while a member or the spouse or dependent of a member of the civil or military service of this state or of the United States, nor while engaged in the navigation of the waters of this state or of the United States or of the high seas if that person returns to the state of Washington within one year of discharge from said service with the intent to be domiciled in the state of Washington; any resident dependent student who remains in this state when such student's parents, having theretofore been domiciled in this state for a period of one year immediately prior to the time of commencement of the first day of the semester or quarter for which the student has registered at any institution, remove from this state, shall be entitled to continued classification as a resident student so long as such student's attendance (except summer sessions) at an institution in this state is continuous.

(3) To aid the institution in deciding whether a student, parent, legally appointed guardian or the person having legal custody of a student is domiciled in the state of Washington primarily for purposes other than educational, the rules and regulations adopted by the higher education coordinating board shall include but not be limited to the following:

(a) Registration or payment of Washington taxes or fees on a motor vehicle, mobile home, travel trailer, boat, or any other item of personal property owned or used by the person for which state registration or the payment of a state tax or fee is required will be a factor in considering evidence of the establishment of a Washington domicile.

(b) Permanent full time employment in Washington by a person will be a factor in considering the establishment of a Washington domicile.

(c) Registration to vote for state officials in Washington will be a factor in considering the establishment of a Washington domicile.

(4) After a student has registered at an institution such student's classification shall remain unchanged in the absence of satisfactory evidence to the contrary. A student wishing to apply for a change in classification shall reduce such evidence to writing and file it with the institution. In any case involving an application for a change from nonresident to resident status, the burden of proof shall rest with the applicant. Any change in classification, either nonresident to resident, or the reverse, shall be based upon written evidence maintained in the files of the institution and, if approved, shall take effect the semester or quarter such evidence was filed with the institution: PROVIDED, That applications for a change in classification shall be accepted up to the thirtieth calendar day following the first day of instruction of the quarter or semester for which application is made.

Sec. 7. RCW 28B.15.031 and 1993 sp.s. c 18 s 6 and 1993 c 379 s 201 are each reenacted and amended to read as follows:

The term "operating fees" as used in this chapter shall include the fees, other than building fees, charged all students registering at the state's colleges and universities but shall not include fees for short courses, self-supporting degree credit programs and courses, marine station work, experimental station work, correspondence or extension courses, and individual instruction and student deposits or rentals, disciplinary and library fines, which colleges and universities shall have the right to impose, laboratory, gymnasium, health, and student activity fees, or fees, charges, rentals, and other income derived from any or all revenue producing lands, buildings and facilities of the colleges or universities heretofore or hereafter acquired, constructed or installed, including but not limited to income from rooms, dormitories, dining rooms, hospitals, infirmaries, housing or student activity buildings, vehicular parking facilities, land, or the appurtenances thereon, or such other special fees as may be established by any college or university board of trustees or regents from time to time. Program fees at the state universities, regional universities, and The Evergreen State College are not included in operating fees. All moneys received as operating fees at any institution of higher education shall be deposited in a local account containing only operating fees revenue and related interest: PROVIDED, That except as provided in section 13 of this act, two and one-half percent of operating fees shall be retained by the institutions, except the technical colleges, for the purposes of RCW 28B.15.820. Local operating fee accounts shall not be subject to appropriation by the legislature or allotment procedures under chapter 43.88 RCW.

Sec. 8. RCW 28B.15.067 and 1992 c 231 s 4 are each amended to read as follows:

(1) Tuition fees shall be established and adjusted annually under the provisions of this chapter beginning with the 1987‑88 academic year. If an institution of higher education exercises its authority under section 13 of this act, such fees ((shall be identical, subject to other provisions of this chapter, for students enrolled at either state university, for students enrolled at the regional universities and The Evergreen State College and for students enrolled at any community college)) may vary by term, by institution, and by campus for students enrolled at state universities, regional universities, and The Evergreen State College. Such fees shall be identical for students enrolled at any community college. Except as provided in section 13 of this act, tuition fees shall reflect the undergraduate and graduate educational costs of the state universities, the regional universities and the community colleges, respectively, in the amounts prescribed in this chapter.

(2) The tuition fees established under this chapter shall not apply to high school students enrolling in community colleges under RCW 28A.600.300 through 28A.600.395.

NEW SECTION. Sec. 9. A new section is added to chapter 28B.15 RCW to read as follows:

The governing boards of the state universities, regional universities, and The Evergreen State College may charge program fees. The fees may vary by program, by student category, and by campus. These fees shall not be included in tuition fees.

Sec. 10. RCW 28B.15.076 and 1989 c 245 s 4 are each amended to read as follows:

The higher education coordinating board shall determine and transmit amounts constituting approved undergraduate and graduate educational costs to the several boards of regents and trustees of the state institutions of higher education by November 10 of each even-numbered year except the year 1990 for which the transmittal shall be made by December 17. Except as provided in section 13 of this act, tuition fees shall be based on such costs in accordance with the provisions of this chapter.

Sec. 11. RCW 28B.15.202 and 1993 sp.s. c 18 s 8 and 1993 c 379 s 202 are each reenacted and amended to read as follows:

Except as provided in section 13 of this act, tuition fees and maximum services and activities fees at the University of Washington and at Washington State University for other than the summer term shall be as follows:

(1) For full time resident undergraduate students and all other full time resident students not in graduate study programs or enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, and doctor of veterinary medicine, the total tuition fees for the 1993-94 academic year shall be thirty-six and three-tenths percent and thereafter total tuition fees shall be forty-one and one-tenth percent of the per student undergraduate educational costs at the state universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be one hundred and twenty dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(2) For full time resident graduate and law students not enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, and doctor of veterinary medicine, the total tuition fees for the 1993-94 academic year shall be twenty-five and two-tenths percent and thereafter total tuition fees shall be twenty-eight and four-tenths percent of the per student graduate educational costs at the state universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be one hundred and twenty dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(3) For full time resident students enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, and doctor of veterinary medicine, the total tuition fees shall be one hundred sixty‑seven percent of such fees charged in subsection (2) of this section: PROVIDED, That the building fees for each academic year shall be three hundred and forty‑two dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(4) For full time nonresident undergraduate students and such other full time nonresident students not in graduate study programs or enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, or doctor of veterinary medicine, the total tuition fees for the 1993-94 academic year shall be one hundred nine and three-tenths percent and thereafter total tuition fees shall be one hundred twenty-two and nine-tenths percent of the per student undergraduate educational costs at the state universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be three hundred and fifty‑four dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(5) For full time nonresident graduate and law students not enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, and doctor of veterinary medicine, the total tuition fees for the 1993-94 academic year shall be sixty-five and six-tenths percent and thereafter total tuition fees shall be seventy-three and six-tenths percent of the per student graduate educational costs at the state universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be three hundred and fifty‑four dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(6) For full time nonresident students enrolled in programs leading to the degrees of doctor of medicine, doctor of dental surgery, and doctor of veterinary medicine, the total tuition fees shall be one hundred sixty‑seven percent of such fees charged in subsection (5) of this section: PROVIDED, That the building fees for each academic year shall be five hundred and fifty‑five dollars. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(7) The governing boards of the state universities shall charge to and collect from each student, a services and activities fee. The governing board may increase the existing fee annually, consistent with budgeting procedures set forth in RCW 28B.15.045, by a percentage not to exceed the annual percentage increase in resident undergraduate tuition fees: PROVIDED, That such percentage increase shall not apply to that portion of the services and activities fee previously committed to the repayment of bonded debt. For the 1993-94 academic year, services and activities fees shall not exceed two hundred forty-three dollars per student. For the 1994-95 academic year, services and activities fees shall not exceed two hundred forty-nine dollars per student. The services and activities fee committee provided for in RCW 28B.15.045 may initiate a request to the governing board for a fee increase.

Sec. 12. RCW 28B.15.402 and 1993 sp.s. c 18 s 11 and 1993 c 379 s 203 are each reenacted and amended to read as follows:

Except as provided in section 13 of this act, tuition fees and maximum services and activities fees at the regional universities and The Evergreen State College for other than the summer term shall be as follows:

(1) For full time resident undergraduate students and all other full time resident students not in graduate study programs, the total tuition fees for the 1993-94 academic year shall be twenty-seven and seven-tenths percent and thereafter total tuition fees shall be thirty-one and five-tenths percent of the per student undergraduate educational costs at the regional universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be seventy‑six dollars and fifty cents. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(2) For full time resident graduate students, the total tuition fees for the 1993-94 academic year shall be twenty-five and three-tenths percent and thereafter total tuition fees shall be twenty-eight and six-tenths percent of the per student graduate educational costs at the regional universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be seventy‑six dollars and fifty cents. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(3) For full time nonresident undergraduate students and all other full time nonresident students not in graduate study programs, the total tuition fees for the 1993-94 academic year shall be one hundred nine and four-tenths percent and thereafter total tuition fees shall be one hundred twenty-three percent of the per student undergraduate educational costs at the regional universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be two hundred and ninety‑five dollars and fifty cents. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(4) For full time nonresident graduate students, the total tuition fees for the 1993-94 academic year shall be eighty-two percent and thereafter total tuition fees shall be ninety-two percent of the per student graduate educational costs at the regional universities computed as provided in RCW 28B.15.067 and 28B.15.070: PROVIDED, That the building fees for each academic year shall be two hundred and ninety‑five dollars and fifty cents. Beginning with the 1995-96 academic year the building fee for each academic year shall ((be)) equal or exceed a percentage of total tuition fees. This percentage shall be calculated by the higher education coordinating board and be based on the actual percentage the building fee is of total tuition in the 1994-95 academic year, rounded up to the nearest half percent.

(5) The governing boards of each of the regional universities and The Evergreen State College shall charge to and collect from each student, a services and activities fee. The governing board may increase the existing fee annually, consistent with budgeting procedures set forth in RCW 28B.15.045, by a percentage not to exceed the annual percentage increase in resident undergraduate tuition fees: PROVIDED, That such percentage increase shall not apply to that portion of the services and activities fee previously committed to the repayment of bonded debt. For the 1993-94 academic year, services and activities fees shall not exceed two hundred ((~~eight-four [eighty-four]~~)) eighty-four dollars per student. For the 1994-95 academic year, services and activities fees shall not exceed two hundred ninety dollars per student. The services and activities fee committee provided for in RCW 28B.15.045 may initiate a request to the governing board for a fee increase.

NEW SECTION. Sec. 13. A new section is added to chapter 28B.15 RCW to read as follows:

The governing board of a state university, regional university, or The Evergreen State College may adjust the level of tuition fees above or below the levels prescribed in RCW 28B.15.202 and 28B.15.402, for students in any category, under the following conditions:

(1) The board shall, through a process adopted in rule, consult with students;

(2) The per student funding of estimated or actual state appropriations shall be below a percentile of similar funding for the institution's peers adopted under RCW 28B.80.330, as follows:

(a) During the 1995-96 academic year, the sixty-fifth percentile;

(b) During the 1996-97 academic year, the seventieth percentile;

(d) During the 1998-99 academic year, the eightieth percentile;

(e) During the 1999-2000 academic year, the eighty-fifth percentile; and

(f) During the 2000-01 academic year and thereafter, the ninetieth percentile;

(3) In any academic year, the total revenue collected from tuition fees and program fees, when added to state appropriations, shall not exceed the combined state appropriation and tuition and fee revenues for that institution's peers at the percentiles described in subsection (2) of this section; and

(4) If a governing board increases tuition fees under the authority granted to it under this section, at least five percent of all revenue collected from tuition fees shall be used for the purposes of RCW 28B.15.820.

Sec. 14. RCW 28B.15.556 and 1993 sp.s. c 18 s 21 are each amended to read as follows:

Subject to the limitations of RCW 28B.15.910, the governing boards of the state universities, the regional universities, and The Evergreen State College may waive all or a portion of the tuition, and services and activities fees for undergraduate or graduate students of foreign nations subject to the following limitations:

(1) ((~~No more than the equivalent of one hundred waivers may be awarded to undergraduate or graduate students of foreign nations at each of the two state universities;~~

~~(2) No more than the equivalent of twenty waivers may be awarded to undergraduate or graduate students of foreign nations at each of the regional universities and The Evergreen State College;~~

~~(3)~~)) Priority in the awarding of waivers shall be given to students on academic exchanges or academic special programs sponsored by recognized international educational organizations((~~; and~~

~~(4) An undergraduate or graduate student of a foreign nation receiving a waiver under this section is not eligible for any other waiver~~)).

(2) The waiver programs under this section, to the greatest extent possible, shall promote reciprocal placements and waivers in foreign nations for Washington residents. The number of waivers awarded by each institution shall not exceed the number of that institution's own students enrolled in approved study programs abroad during the same period.

Sec. 15. RCW 28B.15.725 and 1993 sp.s. c 18 s 26 are each amended to read as follows:

Subject to the limitations of RCW 28B.15.910, the governing boards of the state universities, the regional universities, and The Evergreen State College may enter into undergraduate ((~~upper division~~)) student exchange agreements with ((~~comparable public four-year~~)) institutions of higher education of other states and agree to exempt participating undergraduate ((~~upper division~~)) students from payment of all or a portion of the nonresident tuition fees differential subject to the following restrictions:

(1) In any given academic year, the number of students receiving a waiver at a state institution shall not exceed the number of that institution's students receiving nonresident tuition waivers at participating out-of-state institutions. Waiver imbalances that may occur in one year shall be off-set in the year immediately following.

(2) Undergraduate ((~~upper division~~)) student participation in an exchange program authorized by this section is limited to one academic year.

Sec. 16. 1989 c 290 s 1 (uncodified) is amended to read as follows:

The legislature recognizes that a unique educational experience can result from an undergraduate ((~~upper division~~)) student attending an out-of-state institution. It also recognizes that some Washington residents may be unable to pursue such out-of-state enrollment owing to their limited financial resources and the higher cost of nonresident tuition. The legislature intends to facilitate expanded nonresident undergraduate ((~~upper division~~)) enrollment opportunities for residents of the state by authorizing the governing boards of the four-year institutions of higher education to enter into exchange programs with other states' ((~~comparable public four-year~~)) institutions with comparable programs wherein the participating institutions agree that visiting undergraduate ((~~upper division~~)) students will pay resident tuition rates of the host institutions.

Sec. 17. RCW 28B.15.740 and 1993 sp.s. c 18 s 28 are each amended to read as follows:

Subject to the limitations of RCW 28B.15.910, the governing boards of the state universities, the regional universities, The Evergreen State College, and the community colleges may waive all or a portion of tuition and fees subject to the following restrictions:

(1) ((~~Except as provided in subsection (2) of this section,~~)) The total dollar amount of tuition and fee waivers awarded by the governing boards of community colleges considered as a whole shall not exceed ((~~four percent, except for the community colleges considered as a whole, such amount shall not exceed~~)) three percent of an amount determined by estimating the total collections from tuition and services and activities fees had no such waivers been made, and deducting the portion of that total amount that is attributable to the difference between resident and nonresident fees: PROVIDED, That at least three-fourths of the dollars waived shall be for needy students who are eligible for resident tuition and fee rates pursuant to RCW 28B.15.012 and 28B.15.013: PROVIDED FURTHER, That the remainder of the dollars waived, not to exceed one-fourth of the total, may be applied to other students at the discretion of the governing boards, except on the basis of participation in intercollegiate athletic programs((~~: PROVIDED FURTHER, That the waivers for undergraduate and graduate students of foreign nations under RCW 28B.15.556 are not subject to the limitation under this section~~)).

(2) ((~~In addition to the tuition and fee waivers provided in subsection (1) of this section and~~)) The governing boards of the state universities, regional universities, and The Evergreen State College may waive all or a portion of tuition and fees for needy students who are eligible for resident tuition and fee rates pursuant to RCW 28B.15.012 and 28B.15.013, or for any other student, except on the basis of intercollegiate athletics.

(3) Subject to the provisions of RCW 28B.15.455 and 28B.15.460, a total dollar amount of tuition and fee waivers awarded by any state university, regional university, or state college under this chapter, not to exceed one percent, as calculated in subsection (1) of this section, may be used for the purpose of achieving or maintaining gender equity in intercollegiate athletic programs. At any institution that has an underrepresented gender class in intercollegiate athletics, any such waivers shall be awarded:

(a) First, to members of the underrepresented gender class who participate in intercollegiate athletics, where such waivers result in saved or displaced money that can be used for athletic programs for the underrepresented gender class. Such saved or displaced money shall be used for programs for the underrepresented gender class; and

(b) Second, (i) to nonmembers of the underrepresented gender class who participate in intercollegiate athletics, where such waivers result in saved or displaced money that can be used for athletic programs for members of the underrepresented gender class. Such saved or displaced money shall be used for programs for the underrepresented gender class; or (ii) to members of the underrepresented gender class who participate in intercollegiate athletics, where such waivers do not result in any saved or displaced money that can be used for athletic programs for members of the underrepresented gender class.

Sec. 18. RCW 28B.15.820 and 1993 c 385 s 1 and 1993 c 173 s 1 are each reenacted and amended to read as follows:

(1) Each ((~~institution of higher education, except technical colleges,~~)) community college shall deposit two and one-half percent of revenues collected from tuition and services and activities fees in an institutional financial aid fund that is hereby created and which shall be held locally. Each state university, regional university, and The Evergreen State College shall deposit a minimum of two and one-half percent of revenue collected from tuition and services and activities fees into the fund. Any institution that exercises the authority granted in section 13 of this act shall deposit a minimum of five percent of revenue collected from tuition and services and activities fees into the fund. Moneys in the fund shall be used only for the following purposes: (a) To make guaranteed long-term loans to eligible students as provided in subsections (3) through (8) of this section; (b) to make short-term loans as provided in subsection (9) of this section; or (c) to provide financial aid to needy students as provided in subsection (10) of this section.

(2) An "eligible student" for the purposes of subsections (3) through (8) and (10) of this section is a student registered for at least six credit hours or the equivalent, who is eligible for resident tuition and fee rates as defined in RCW 28B.15.012 through 28B.15.013, and who is a "needy student" as defined in RCW 28B.10.802.

(3) The amount of the guaranteed long-term loans made under this section shall not exceed the demonstrated financial need of the student. Each institution shall establish loan terms and conditions which shall be consistent with the terms of the guaranteed loan program established by 20 U.S. Code Section 1071 et seq., as now or hereafter amended. All loans made shall be guaranteed by the Washington student loan guaranty association or its successor agency. Institutions are hereby granted full authority to operate as an eligible lender under the guaranteed loan program.

(4) Before approving a guaranteed long-term loan, each institution shall analyze the ability of the student to repay the loan based on factors which include, but are not limited to, the student's accumulated total education loan burdens and the employment opportunities and average starting salary characteristics of the student's chosen fields of study. The institution shall counsel the student on the advisability of acquiring additional debt, and on the availability of other forms of financial aid.

(5) Each institution is responsible for collection of guaranteed long-term loans made under this section and shall exercise due diligence in such collection, maintaining all necessary records to insure that maximum repayments are made. Institutions shall cooperate with other lenders and the Washington student loan guaranty association, or its successor agency, in the coordinated collection of guaranteed loans, and shall assure that the guarantability of the loans is not violated. Collection and servicing of guaranteed long-term loans under this section shall be performed by entities approved for such servicing by the Washington student loan guaranty association or its successor agency: PROVIDED, That institutions be permitted to perform such servicing if specifically recognized to do so by the Washington student loan guaranty association or its successor agency. Collection and servicing of guaranteed long-term loans made by community colleges under subsection (1) of this section shall be coordinated by the state board for community and technical colleges and shall be conducted under procedures adopted by the state board.

(6) Receipts from payment of interest or principal or any other subsidies to which institutions as lenders are entitled, that are paid by or on behalf of borrowers of funds under subsections (3) through (8) of this section, shall be deposited in each institution's financial aid fund and shall be used to cover the costs of making the guaranteed long-term loans under this section and maintaining necessary records and making collections under subsection (5) of this section: PROVIDED, That such costs shall not exceed five percent of aggregate outstanding loan principal. Institutions shall maintain accurate records of such costs, and all receipts beyond those necessary to pay such costs, shall be deposited in the institution's financial aid fund.

(7) The governing boards of the state universities, the regional universities, and The Evergreen State College, and the state board for community and technical colleges, on behalf of the community colleges, shall each adopt necessary rules and regulations to implement this section.

(8) First priority for any guaranteed long-term loans made under this section shall be directed toward students who would not normally have access to educational loans from private financial institutions in Washington state, and maximum use shall be made of secondary markets in the support of loan consolidation.

(9) Short-term low or no-interest loans, not to exceed one year, may be made from the institutional financial aid fund to students enrolled in the institution. No such loan shall be made to any student who is known by the institution to be in default or delinquent in the payment of any outstanding student loan. A short-term loan may be made only if the institution has ample evidence that the student has the capability of repaying the loan within the time frame specified by the institution for repayment.

(10) Any moneys deposited in the institutional financial aid fund that are not used in making long-term or short-term loans may be used by the institution for locally-administered financial aid programs for needy students, such as need-based institutional employment programs or need-based tuition and fee scholarship or grant programs. These funds shall be used in addition to and not to replace institutional funds that would otherwise support these locally-administered financial aid programs. First priority in the use of these funds shall be given to needy students who have accumulated excessive educational loan burdens. An excessive educational loan burden is a burden that will be difficult to repay given employment opportunities and average starting salaries in the student's chosen fields of study. Second priority in the use of these funds shall be given to needy single parents, to assist these students with their educational expenses, including expenses associated with child care and transportation.

Sec. 19. RCW 28B.80.330 and 1993 c 363 s 6 are each amended to read as follows:

The board shall perform the following planning duties in consultation with the four-year institutions, the community and technical college system, and when appropriate the work force training and education coordinating board, the superintendent of public instruction, and the independent higher educational institutions:

(1) Develop and establish role and mission statements and a set of peer institutions for each of the four-year institutions and for the community and technical college system. In adopting or revising a set of peer institutions, the board shall consult with institutions of higher education, the office of financial management, and the house of representatives and senate higher education and fiscal committees;

(2) Identify the state's higher education goals, objectives, and priorities;

(3) Prepare a comprehensive master plan which includes but is not limited to:

(a) Assessments of the state's higher education needs. These assessments may include, but are not limited to: The basic and continuing needs of various age groups; business and industrial needs for a skilled work force; analyses of demographic, social, and economic trends; consideration of the changing ethnic composition of the population and the special needs arising from such trends; college attendance, retention, and dropout rates, and the needs of recent high school graduates and placebound adults. The board should consider the needs of residents of all geographic regions, but its initial priorities should be applied to heavily populated areas underserved by public institutions;

(b) Recommendations on enrollment and other policies and actions to meet those needs;

The initial plan shall be submitted to the governor and the legislature by December 1, 1987. Comments on the plan from the board's advisory committees and the institutions shall be submitted with the plan.

The plan shall be updated every four years, and presented to the governor and the appropriate legislative policy committees. Following public hearings, the legislature shall, by concurrent resolution, approve or recommend changes to the initial plan, and the updates. The plan shall then become state higher education policy unless legislation is enacted to alter the policies set forth in the plan;

(4) Review, evaluate, and make recommendations on operating and capital budget requests from four-year institutions and the community and technical college system, based on the elements outlined in subsections (1), (2), and (3) of this section, and on guidelines which outline the board's fiscal priorities. These guidelines shall be distributed to the institutions and the community college board by December of each odd-numbered year. The institutions and the community college board shall submit an outline of their proposed budgets, identifying major components, to the board no later than August 1 of each even-numbered year. The board shall submit recommendations on the proposed budgets and on the board's budget priorities to the office of financial management before October 15 of each even-numbered year, and to the legislature by January 1 of each odd-numbered year. In addition, the board shall develop and submit to the governor and the legislature a budget request for the higher education system as a whole. The request shall describe any new funding needed to meet all or a portion of the state's higher education priorities, enrollments in four-year institutions needed to maintain current participation rates, and enrollments in four-year institutions needed to meet the board's enrollment targets. The request shall be separate from the budget requests submitted to the governor and the legislature by each of the four-year institutions and the state board for community and technical colleges;

(5) Recommend legislation affecting higher education;

(6) Recommend tuition and fees policies and levels based on comparisons with peer institutions;

(7) Establish priorities and develop recommendations on financial aid based on comparisons with peer institutions;

(8) Prepare recommendations on merging or closing institutions; and

(9) Develop criteria for identifying the need for new baccalaureate institutions.

NEW SECTION. Sec. 20. A new section is added to chapter 28B.80 RCW to read as follows:

(1) The higher education coordinating board may contract with an independent institution of higher education as defined in this section, to provide services subject to the following conditions:

(a) There has been a finding of need and that the contract represents the most cost-effective way of providing the services to resident students in a particular locality;

(b) Only students who are residents of the state of Washington shall receive services pursuant to the contract. As used in this subsection, "residents of the state of Washington" means that the students would be eligible to pay resident tuition rates under RCW 28B.15.012 and 28B.15.013 if they were enrolled at state institutions of higher education as defined in RCW 28B.10.016;

(c) The content of the program shall not include any religious or sectarian instruction, nor shall any student for whom a contract provision has been made be expected to participate in any sectarian activity as a condition of enrollment;

(d) The tuition and fees charged to resident students by the independent institution of higher education for the degree program or instructional program services shall not exceed the rate for resident tuition fees, services and activities fees, and any applicable program fees for comparable programs at institutions of higher education as defined in RCW 28B.10.016, as determined by the higher education coordinating board; and

(e) The contract has been approved by the office of the attorney general.

(2) Unless the context clearly requires otherwise, the following definitions apply throughout this section.

(a) "Instructional program" means a course of study leading to certification, licensure, or to a degree at the associate, baccalaureate, masters, or doctoral level.

(b) "Independent institution of higher education" means a private, nonprofit educational institution, the main campus of which is permanently situated in the state, that is not pervasively sectarian, that does not restrict entry or employment on the grounds of race, gender, religion, or disability, that provides programs of education beyond high school leading at least to the baccalaureate degree, and that is accredited by the Northwest association of schools and colleges, or by an accrediting association recognized by the higher education coordinating board.

NEW SECTION. Sec. 21. RCW 41.06.382 and 1979 ex.s. c 46 s 1 are each repealed.

NEW SECTION. Sec. 22. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.