Passed by the House April 22, 2003 Yeas 97 Nays 0 FRANK CHOPP ________________________________________ Speaker of the House of Representatives Passed by the Senate April 11, 2003 Yeas 49 Nays 0 BRAD OWEN ________________________________________ President of the Senate		CERTIFICATE I, Cynthia Zehnder, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is SUBSTITUTE HOUSE BILL 2111 as passed by the House of Representatives and the Senate on the dates hereon set forth. CYNTHIA ZEHNDER ________________________________________ Chief Clerk
Approved May 7, 2003. GARY LOCKE ________________________________________ Governor of the State of Washington		FILED May 7, 2003 - 3:04 p.m. Secretary of State State of Washington

AN ACT Relating to performance contracts between the state and institutions of higher education; creating new sections; and providing an expiration date.

NEW SECTION.  Sec. 1   (1) The legislature finds that ten years have passed since the state attempted to redefine the relationship with its institutions of higher education based on trust, evidence, and a new alignment of responsibilities, as articulated in chapter 363, Laws of 1993.
     (2) However, the legislature also finds that the intent to combine institutional flexibility and authority to make decisions at the local level with accountability for achieving statewide goals and objectives has never been fully achieved, in part because there has not been an operating mechanism through which to implement this relationship.
     (3) Therefore, the legislature intends to explore opportunities to create performance contracts between the state and public institutions of higher education. It is the intent of the legislature that such a contract would constitute a negotiated agreement between the state and an institution, where the state's primary interest would lie not in the management and operations of an institution, but in the institution's contribution to achieving agreed-upon statewide goals and objectives for higher education.

NEW SECTION.  Sec. 2   (1) A work group on higher education performance contracts is established. The work group shall consist of members as follows:
     (a) The members of the house and senate higher education and fiscal committees;
     (b) One representative of the higher education coordinating board, appointed by the board;
     (c) One representative of the state board for community and technical colleges, appointed by the state board;
     (d) Two representatives of public four-year institutions of higher education, appointed by the council of presidents;
     (e) Two representatives of the community and technical colleges, appointed by the Washington association of community and technical colleges; and
     (f) One representative of the governor's office and one representative of the office of financial management, each appointed by the governor.
     (2) The work group may invite input from other interested parties, including but not limited to faculty and student representatives and representatives of the business community. Within available funds, the work group may obtain additional expertise or engage consultants if necessary to carry out its work.
     (3) The work group shall:
     (a) Examine the experience of other states in developing and implementing performance contracts with institutions of higher education;
     (b) Consider the feasibility of implementing performance contracts in Washington;
     (c) Identify whether amendments to current laws may be necessary to implement performance contracts; and
     (d) Develop guidelines and possible models for performance contracts, including:
     (i) The types of indicators and benchmarks that could be included in a contract to measure an institution's progress in meeting the contract's objectives; and
     (ii) The types of flexibility, exemptions, or commitments that could be included in a contract to reflect the state's obligation to an institution.
     (4) The work group shall use legislative facilities and staff from senate committee services and the office of program research. Each nonlegislative member of the work group shall be reimbursed for travel expenses in accordance with RCW 43.03.050 and 43.03.060. Travel expenses for the nonlegislative members shall be paid by their respective institutions or agencies.
     (5) The work group shall report its findings and recommendations to the higher education and fiscal committees of the legislature by December 15, 2003.