HOUSE BILL REPORT

2SSB 5383

BYSenate Committee on Ways & Means (originally sponsored by Senators Zimmerman, Saling, Gaspard, Rinehart and Lee)

Creating the capital projects incentive program for community colleges.

House Committe on Higher Education

Majority Report:  Do pass.  (12)

      Signed by Representatives Jacobsen, Chair; Heavey, Vice Chair; Allen, Barnes, Basich, Jesernig, Miller, Nelson, Silver, Unsoeld, K. Wilson and Wineberry.

Minority Report:  Do not pass.  (1)

      Signed by Representative Prince.

House Staff:Susan Hosch (786-7120)

AS REPORTED BY COMMITTEE ON HIGHER EDUCATION APRIL 1, 1987

BACKGROUND:

Washington community colleges have two major sources of capital funds:  the building fee portion of tuition and fees, which was set in 1971-72 at $127.50 per year, and the state general fund.  Both sources are used to retire general obligation bonds, the proceeds of which are appropriated by the Legislature.  It has been suggested that the community colleges be encouraged to seek additional revenue from private contributors to help meet capital needs.

The Distinguished Professors program has been suggested as a model for creating a matching fund program to help meet community college capital funding needs.  The legislature created the Distinguished Professors program in 1985 to help four-year colleges and universities create endowments for distinguished scholars.  That program allows institutions to apply for $250,000 from trust funds when such institutions can match state funds with equally pledged contributed private donations.  This matching arrangement enables the state to double the impact of each dollar raised and spent in that program.

SUMMARY:

The capital projects incentive program for Washington community colleges is created to encourage public two-year colleges to raise money from private sources for capital construction projects.  The program is intended to provide an additional funding source for capital projects but not to replace any other means of funding these projects.  The program is administered by the State Board for Community College Education (SBCCE), which will provide grants, when funds are available, to community colleges that:  apply for grants, demonstrate a need for capital projects, agree to conditions established by the SBCCE, obtain explicit project approval before any private fund-raising efforts, and match state funds with equal amounts of money pledged or contributed from private sources specifically for capital projects.

The SBCCE is responsible for:  adopting necessary rules, establishing a screening committee to evaluate proposals, publishing criteria for evaluating proposals, actively soliciting grants and providing information to community colleges about the program, establishing reporting and monitoring requirements for grant recipients, and approving projects prior to any fund-raising efforts.  The SBCCE is also responsible for awarding grants in the order they are approved.  These grants must be equal to amounts contributed from private sources.  The SBCCE is prohibited from reducing the amount of promised grants and thereby distributing smaller grants to more projects.

Community colleges that receive funds for the capital incentive program may deposit such funds in their local funds but must use the funds only for purposes specified in their grants.

The SBCCE is empowered to receive and expend contributions to this program, but must deposit all monies received in the capital projects incentive fund, which is assigned to the state treasurer.  The SBCCE authorizes all disbursements from the fund, which is subject to allotment approval by the Office of Financial Management but does not require legislative appropriation for disbursement.

Fiscal Note:      Attached.

House Committee ‑ Testified For:    Bill Julius, State Board for Community College Education.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Passage of this measure will allow the state and private contributors to work as partners in support of new or renovated community college facilities.

House Committee - Testimony Against:      None Presented.