BILL REQ. #:  H-0676.3 

Read first time 01/24/2005.   Referred to Committee on Higher Education.

     AN ACT Relating to implementing a strategic direction for higher education by the year 2012; amending RCW 28B.10.784, 28B.15.067, 28B.92.010, 28B.92.020, 28B.45.014, 28B.45.020, 28B.45.030, 28B.45.040, 28B.50.030, 28B.50.140, 28B.15.069, 28B.50.090, and 28B.76.290; adding a new section to chapter 28B.10 RCW; adding a new section to chapter 28B.50 RCW; adding a new chapter to Title 28B RCW; creating a new section; and repealing RCW 28B.10.776, 28B.10.778, 28B.10.780, 28B.10.782, 28B.10.786, 28B.45.060, 28B.45.080, and 28B.76.270.

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

NEW SECTION.  Sec. 101   A new section is added to chapter 28B.10 RCW to read as follows:
     (1) The legislature finds that the system of public higher education in Washington state is at a crossroads. Demographic and economic pressures place competing demands on policymakers and on colleges and universities. Increasing numbers of students are demanding access to work force training and baccalaureate and advanced degree programs. Businesses are demanding highly qualified workers and technological advancements gained through university research. At the same time, taxpayers expect policymakers to set priorities and maximize use of public resources.
     (2) It is the legislature's intent to articulate a strategic direction for public higher education on issues of access, affordability, service delivery, and accountability that will guide coordinated decision making on policies, operating budgets, and capital plans. It is further the legislature's intent to provide the management tools and resources necessary to implement the strategic direction. Additional investment in higher education is needed, but the public deserves assurance that such an investment is based on a clear plan and will be carefully managed with specific expectations and measurable outcomes.
     (3) It is the strategic direction and intent of the legislature, by the year 2012, to:
     (a) Increase capacity in higher education by thirty thousand enrollment slots, with fourteen thousand enrollment slots dedicated to expanding work force training;
     (b) Graduate three thousand eight hundred additional baccalaureate degrees per year by focusing degree production at the regional universities in partnership with community and technical colleges;
     (c) Expand programs and enrollments targeted toward high demand fields by twelve thousand five hundred enrollment slots;
     (d) Maintain the market responsiveness and multiple missions of the community and technical college system, including transfer preparation, adult remedial education, work force training, and life-long learning;
     (e) Assure that the cost of attendance for all students is less than thirty percent of family income;
     (f) Through the strategic master plan for higher education, create specific targets for enrollments and degree production through analysis of statewide and regional demographics and economic needs and comparison to peer institutions and national benchmarks;
     (g) Implement the strategic direction and master plan through performance contracts with each institution of higher education;
     (h) Through financial aid and other new financing or enrollment allocation strategies, leverage the state investment in higher education by using existing capacity at independent four-year institutions of higher education; and
     (i) Increase the state's overall investment in higher education by four hundred sixty million dollars per biennium, including one hundred million dollars per biennium invested in high priority research, to ensure that Washington's institutions of higher education continue to offer affordable access to the highest quality education and conduct world class research and discovery.
     (4) It is further the legislature's intent to implement the strategic direction for higher education using the following policies:
     (a) Expand enrollment at the regional universities, the state college, and branch campuses and freeze undergraduate enrollment at the main campuses of the research universities;
     (b) Accelerate transition of the branch campuses into four-year universities offering baccalaureate and master's degree programs;
     (c) Provide a portion of new enrollment funding to community and technical colleges and authorize the colleges to contract with a regional university, branch campus, or the state college to offer baccalaureate degree programs;
     (d) Create new opportunities for students with associate degrees in technical fields to earn applied baccalaureate degrees;
     (e) Increase per-student funding for current and future enrollments to the average of peer institutions;
     (f) Reform the state need grant program to address the goal that cost of attendance is less than thirty percent of family income;
     (g) Authorize institution governing boards to set tuition rates so that, by the year 2012 and thereafter, tuition and mandatory fees equal the average tuition and fees of peer institutions; and
     (h) Direct the higher education coordinating board to establish performance contracts with each four-year institution and direct the state board for community and technical colleges to establish a master performance contract for the community and technical college system.

Sec. 102   RCW 28B.10.784 and 1993 sp.s. c 15 s 6 are each amended to read as follows:
     The office of financial management, as part of its responsibility to develop and maintain student enrollment forecasts for colleges and universities under RCW 43.62.050, shall calculate enrollment levels necessary to maintain, by educational sector, the participation rate funded in fiscal year 1993. The participation rate shall be based on the state's estimated population ages seventeen and older by appropriate age groups. The participation rate ((used to calculate enrollment levels under RCW 28B.10.776 and 28B.10.782)) shall be based on fall enrollment reported in the higher education enrollment report as maintained by the office of financial management, fall enrollment as reported in the management information system of the state board for community and technical colleges, and the corresponding fall population forecast by the office of financial management. ((Formal estimates of the state participation rates and enrollment levels necessary to fulfill the requirements of RCW 28B.10.776 and 28B.10.782 shall be determined by the office of financial management as part of its responsibility to develop and maintain student enrollment forecasts for colleges and universities under RCW 43.62.050.)) Formal estimates of the state participation rates and enrollment levels required by this section shall be based on procedures and standards established by a technical work group consisting of staff from the higher education coordinating board, the public four-year institutions of higher education, the state board for community and technical colleges, the fiscal and higher education committees of the house of representatives and the senate, and the office of financial management. Formal estimates of the state participation rates and enrollment levels required by this section shall be submitted to the fiscal committees of the house of representatives and senate on or before November 15th of each even-numbered year. ((The higher education coordinating board shall periodically review the enrollment goals set forth in RCW 28B.10.776 and 28B.10.782 and submit recommendations concerning modification of these goals to the governor and to the higher education committees of the house of representatives and the senate.))

NEW SECTION.  Sec. 103   The following acts or parts of acts are each repealed:
     (1) RCW 28B.10.776 (Budget calculation -- Enrollment levels--Participation rate) and 1993 sp.s. c 15 s 2;
     (2) RCW 28B.10.778 (Budget calculation -- New enrollments -- Funding level -- Inflation factor) and 1993 sp.s. c 15 s 3;
     (3) RCW 28B.10.780 (Budget calculation -- Funding level) and 1993 sp.s. c 15 s 4;
     (4) RCW 28B.10.782 (Budget calculation -- Increased enrollment target level -- Availability of information) and 1993 sp.s. c 15 s 5; and
     (5) RCW 28B.10.786 (Budget calculation -- Student financial aid programs) and 1993 sp.s. c 15 s 7.

Sec. 201   RCW 28B.15.067 and 2003 c 232 s 4 are each amended to read as follows:
     (1) Tuition fees shall be established under the provisions of this chapter.
     (2) ((Beginning with the 2003-04 academic year and ending with the 2008-09 academic year, reductions or increases in full-time tuition fees for resident undergraduates shall be as provided in the omnibus appropriations act.)) Beginning with the 2005-06 academic year, the policy of the legislature is that by the 2011-12 academic year and thereafter, tuition and mandatory fees for full-time resident undergraduates at Washington public institutions of higher education shall be equal to the average tuition and mandatory fees for full-time resident undergraduates at peer institutions. Beginning with the 2005-06 academic year, governing boards of the state universities, the regional universities, The Evergreen State College, and the state board for community and technical colleges may increase full-time tuition fees for resident undergraduates to achieve the policy in this subsection, except that annual increases beginning with the 2005-06 academic year and through the 2011-12 academic year may not exceed twelve percent at the four-year institutions and seven percent at the community colleges. Percentage increases in full-time tuition fees may exceed the fiscal growth factor. Reductions or increases may be made for all or portions of an institution's programs, campuses, courses, or students. The average tuition and mandatory fees at peer institutions shall be determined by the higher education coordinating board.
     (3) Beginning with the 2003-04 academic year ((and ending with the 2008-09 academic year)), the governing boards of the state universities, the regional universities, The Evergreen State College, and the state board for community and technical colleges may reduce or increase full-time tuition fees for all students other than resident undergraduates, including summer school students and students in other self-supporting degree programs. Percentage increases in full-time tuition fees may exceed the fiscal growth factor. Reductions or increases may be made for all or portions of an institution's programs, campuses, courses, or students.
     (4) ((Academic year tuition for full-time students at the state's institutions of higher education beginning with 2009-10, other than summer term, shall be as charged during the 2008-09 academic year unless different rates are adopted by the legislature.
     (5))) The tuition fees established under this chapter shall not apply to high school students enrolling in participating institutions of higher education under RCW 28A.600.300 through 28A.600.400.
     (((6) For the academic years)) (5) Beginning with academic year 2003-04 ((through 2008-09)), the University of Washington shall use an amount equivalent to ten percent of all revenues received as a result of law school tuition increases beginning in academic year 2000-01 ((through academic year 2008-09)) to assist needy low and middle income resident law students.
     (((7) For the academic years)) (6) Beginning with academic year 2003-04 ((through 2008-09)), institutions of higher education shall use an amount equivalent to ten percent of all revenues received as a result of graduate academic school tuition increases beginning in academic year 2003-04 ((through academic year 2008-09)) to assist needy low and middle-income resident graduate academic students.

Sec. 202   RCW 28B.92.010 and 2004 c 275 s 34 are each amended to read as follows:
     The purposes of this chapter are to establish the principles upon which the state financial aid programs will be based and to establish the state of Washington state need grant program, ((thus assisting financially needy or disadvantaged)) with the goal of ensuring that students domiciled in Washington ((to obtain the)) have an equitable opportunity of attending an accredited institution of higher education. State need grants under this chapter are available only to students who are resident students as defined in RCW 28B.15.012(2) (a) through (d).

Sec. 203   RCW 28B.92.020 and 2003 c 19 s 11 are each amended to read as follows:
     (1) ((The legislature finds that the higher education coordinating board, in consultation with the higher education community, has completed a review of the state need grant program.)) It is the intent of the legislature ((to endorse the board's proposed changes to)) that the board operate the state need grant program((, including)) according to the following principles:
     (a) ((Reaffirmation that)) The primary purpose of the state need grant program is to ((assist low-income, needy, and disadvantaged)) ensure Washington residents have an equitable opportunity of attending institutions of higher education;
     (b) A goal that ((the base state need grant amount over time be increased to be equivalent to the rate of tuition charged to resident undergraduate students attending Washington state public colleges and universities)) the state need grant be used in combination with other state and federal grants, institutional aid, private scholarships and sources of assistance, and employment so that the cost of attendance for a student attending a public institution of higher education in Washington does not exceed thirty percent of family income. Base state need grant amounts for students attending independent institutions of higher education may not exceed tuition at the University of Washington;
     (c) State need grant recipients be required to contribute a portion of the total cost of their education through self-help;
     (d) State need grant recipients be required to document their need for dependent care assistance after taking into account other public funds provided for like purposes; and
     (e) Institutional aid administrators be allowed to determine whether a student eligible for a state need grant in a given academic year may remain eligible for the ensuing year if the student's family income increases by no more than a marginal amount except for funds provided through the educational assistance grant program for students with dependents.
     (2) The legislature further finds that the higher education coordinating board, under its authority to implement the ((proposed changes)) principles in subsection (1) of this section, should do so in a timely manner. The board shall report to the higher education and fiscal committees of the legislature by December 15, 2006, on the changes made to implement the principles.
     (3) The legislature also finds that:
     (a) In most circumstances, need grant eligibility should not extend beyond five years or one hundred twenty-five percent of the published length of the program in which the student is enrolled or the credit or clock-hour equivalent; and
     (b) State financial aid programs should continue to adhere to the principle that funding follows resident students to their choice of institution of higher education.

Sec. 301   RCW 28B.45.014 and 2004 c 57 s 2 are each amended to read as follows:
     (1) The primary mission of the higher education branch campuses created under this chapter remains to expand access to baccalaureate and master's level graduate education in underserved urban areas of the state ((in collaboration with community and technical colleges)).
     (2) Branch campuses shall collaborate with the community and technical colleges in their region to develop articulation agreements, dual admissions policies, and other partnerships to ensure that branch campuses serve as innovative models of a two plus two educational system. Other possibilities for collaboration include but are not limited to joint development of curricula and degree programs, colocation of instruction, and arrangements to share faculty.
     (3) In communities where a private postsecondary institution is located, representatives of the private institution may be invited to participate in the conversation about meeting the baccalaureate and master's level graduate needs in underserved urban areas of the state.
     (4) ((However, the legislature recognizes there are alternative models for achieving this primary mission. Some campuses may have additional missions in response to regional needs and demands. At selected branch campuses, an innovative combination of instruction and research targeted to support regional economic development may be appropriate to meet the region's needs for both access and economic viability. Other campuses should focus on becoming models of a two plus two educational system through continuous improvement of partnerships and agreements with community and technical colleges. Still other campuses may be best suited to transition to a four-year comprehensive university or be removed from designation as a branch campus entirely.
     (5))) It is the legislature's intent that each branch campus be funded commensurate with its unique mission, the degree programs offered, and the institutional combination of instruction and research, but at a level less than a research university.
     (((6))) (5) In consultation with the higher education coordinating board, a branch campus may propose legislation to authorize practice-oriented or professional doctoral programs if: (a) Unique research facilities and equipment are located near the campus; or (b) the campus can clearly demonstrate student and employer demand in the region that is linked to regional economic development.
     (((7) It is not the legislature's intent to have each campus chart its own future path without legislative guidance. Instead, the legislature intends to consider carefully the mission and model of education that best suits each campus and best meets the needs of students, the community, and the region.))
     (6) Beginning with the 2006-07 academic year, branch campuses may offer lower division courses and undertake other strategies necessary to transition to full-scale four-year institutions that are responsive to student and employer demand for baccalaureate and master's degrees within their respective regions.
     (7) When the enrollment of a branch campus approaches seven thousand five hundred full-time equivalent students or at the written request of a campus community advisory board, the governing board of the research university responsible for the campus shall conduct a governance study to consider alternative governance options for the campus, including transition to a separately governed regional university. Results of any such study shall be forwarded to the higher education committees of the senate and the house of representatives.

Sec. 302   RCW 28B.45.020 and 1994 c 217 s 3 are each amended to read as follows:
     The University of Washington is responsible for ensuring the expansion of ((upper-division)) baccalaureate and graduate educational programs in the central Puget Sound area under rules or guidelines adopted by the higher education coordinating board. The University of Washington shall meet that responsibility through the operation of at least two branch campuses. One branch campus shall be located in the Tacoma area. Another branch campus shall be collocated with Cascadia Community College in the Bothell-Woodinville area.

Sec. 303   RCW 28B.45.030 and 1989 1st ex.s. c 7 s 4 are each amended to read as follows:
     Washington State University is responsible for providing ((upper-division)) baccalaureate and graduate level higher education programs to the citizens of the Tri-Cities area, under rules or guidelines adopted by the higher education coordinating board. Washington State University shall meet that responsibility through the operation of a branch campus in the Tri-Cities area. The branch campus shall replace and supersede the Tri-Cities university center. All land, facilities, equipment, and personnel of the Tri-Cities university center shall be transferred from the University of Washington to Washington State University.

Sec. 304   RCW 28B.45.040 and 1989 1st ex.s. c 7 s 5 are each amended to read as follows:
     Washington State University is responsible for providing ((upper-division)) baccalaureate and graduate level higher education programs to the citizens of the southwest Washington area, under rules or guidelines adopted by the higher education coordinating board. Washington State University shall meet that responsibility through the operation of a branch campus in the southwest Washington area.

NEW SECTION.  Sec. 305   The following acts or parts of acts are each repealed:
     (1) RCW 28B.45.060 (Central Washington University -- Yakima area) and 1989 1st ex.s. c 7 s 7; and
     (2) RCW 28B.45.080 (Partnership between community and technical colleges and branch campuses) and 2004 c 57 s 5 & 1989 1st ex.s. c 7 s 8.

NEW SECTION.  Sec. 306   A new section is added to chapter 28B.50 RCW to read as follows:
     (1) It is the legislature's intent to expand baccalaureate capacity in underserved regions of the state to meet student and employer demand. One strategy to accomplish this intent is to allocate state funds for student enrollment to community and technical colleges and authorize the colleges to contract with a regional university or state college as defined in RCW 28B.10.016 or branch campus under chapter 28B.45 RCW, to offer baccalaureate degree programs. Another strategy is to authorize, under certain circumstances, community or technical college baccalaureate degrees.
     (2) Subject to legislative appropriation for the purpose described in this section:
     (a) A community or technical college may enter into a contract with one or more regional universities, branch campuses, or the state college to offer baccalaureate degree programs on the college campus;
     (b) The college board may enter into a master contract with regional universities, branch campuses, or the state college to offer baccalaureate degree programs on multiple college campuses; or
     (c) Subject to approval by the college board under RCW 28B.50.090, a community or technical college may develop and offer an applied baccalaureate degree program, but only if the degree program is not offered by a public four-year institution of higher education.
     (3) Allocation of funds by the college board shall be based on analysis of gaps in service delivery, capacity, and student and employer demand for programs. Students enrolled in programs under subsection (2)(a) and (b) of this section are considered students of the regional university, branch campus, or state college for all purposes including tuition and reporting of state-funded enrollments.

Sec. 307   RCW 28B.50.030 and 2003 2nd sp.s. c 4 s 33 are each amended to read as follows:
     As used in this chapter, unless the context requires otherwise, the term:
     (1) "System" shall mean the state system of community and technical colleges, which shall be a system of higher education.
     (2) "Board" shall mean the work force training and education coordinating board.
     (3) "College board" shall mean the state board for community and technical colleges created by this chapter.
     (4) "Director" shall mean the administrative director for the state system of community and technical colleges.
     (5) "District" shall mean any one of the community and technical college districts created by this chapter.
     (6) "Board of trustees" shall mean the local community and technical college board of trustees established for each college district within the state.
     (7) "Occupational education" shall mean that education or training that will prepare a student for employment that does not require a baccalaureate degree, as well as education or training leading to an applied baccalaureate degree.
     (8) "K-12 system" shall mean the public school program including kindergarten through the twelfth grade.
     (9) "Common school board" shall mean a public school district board of directors.
     (10) "Community college" shall include those higher education institutions that conduct education programs under RCW 28B.50.020.
     (11) "Technical college" shall include those higher education institutions with the sole mission of conducting occupational education, basic skills, literacy programs, and offering on short notice, when appropriate, programs that meet specific industry needs. The programs of technical colleges shall include, but not be limited to, continuous enrollment, competency-based instruction, industry-experienced faculty, curriculum integrating vocational and basic skills education, and curriculum approved by representatives of employers and labor. For purposes of this chapter, technical colleges shall include Lake Washington Vocational-Technical Institute, Renton Vocational-Technical Institute, Bates Vocational-Technical Institute, Clover Park Vocational Institute, and Bellingham Vocational-Technical Institute.
     (12) "Adult education" shall mean all education or instruction, including academic, vocational education or training, basic skills and literacy training, and "occupational education" provided by public educational institutions, including common school districts for persons who are eighteen years of age and over or who hold a high school diploma or certificate. However, "adult education" shall not include academic education or instruction for persons under twenty-one years of age who do not hold a high school degree or diploma and who are attending a public high school for the sole purpose of obtaining a high school diploma or certificate, nor shall "adult education" include education or instruction provided by any four year public institution of higher education.
     (13) "Dislocated forest product worker" shall mean a forest products worker who: (a)(i) Has been terminated or received notice of termination from employment and is unlikely to return to employment in the individual's principal occupation or previous industry because of a diminishing demand for his or her skills in that occupation or industry; or (ii) is self-employed and has been displaced from his or her business because of the diminishing demand for the business' services or goods; and (b) at the time of last separation from employment, resided in or was employed in a rural natural resources impact area.
     (14) "Forest products worker" shall mean a worker in the forest products industries affected by the reduction of forest fiber enhancement, transportation, or production. The workers included within this definition shall be determined by the employment security department, but shall include workers employed in the industries assigned the major group standard industrial classification codes "24" and "26" and the industries involved in the harvesting and management of logs, transportation of logs and wood products, processing of wood products, and the manufacturing and distribution of wood processing and logging equipment. The commissioner may adopt rules further interpreting these definitions. For the purposes of this subsection, "standard industrial classification code" means the code identified in RCW 50.29.025(3).
     (15) "Dislocated salmon fishing worker" means a finfish products worker who: (a)(i) Has been terminated or received notice of termination from employment and is unlikely to return to employment in the individual's principal occupation or previous industry because of a diminishing demand for his or her skills in that occupation or industry; or (ii) is self-employed and has been displaced from his or her business because of the diminishing demand for the business's services or goods; and (b) at the time of last separation from employment, resided in or was employed in a rural natural resources impact area.
     (16) "Salmon fishing worker" means a worker in the finfish industry affected by 1994 or future salmon disasters. The workers included within this definition shall be determined by the employment security department, but shall include workers employed in the industries involved in the commercial and recreational harvesting of finfish including buying and processing finfish. The commissioner may adopt rules further interpreting these definitions.
     (17) "Rural natural resources impact area" means:
     (a) A nonmetropolitan county, as defined by the 1990 decennial census, that meets three of the five criteria set forth in subsection (18) of this section;
     (b) A nonmetropolitan county with a population of less than forty thousand in the 1990 decennial census, that meets two of the five criteria as set forth in subsection (18) of this section; or
     (c) A nonurbanized area, as defined by the 1990 decennial census, that is located in a metropolitan county that meets three of the five criteria set forth in subsection (18) of this section.
     (18) For the purposes of designating rural natural resources impact areas, the following criteria shall be considered:
     (a) A lumber and wood products employment location quotient at or above the state average;
     (b) A commercial salmon fishing employment location quotient at or above the state average;
     (c) Projected or actual direct lumber and wood products job losses of one hundred positions or more;
     (d) Projected or actual direct commercial salmon fishing job losses of one hundred positions or more; and
     (e) An unemployment rate twenty percent or more above the state average. The counties that meet these criteria shall be determined by the employment security department for the most recent year for which data is available. For the purposes of administration of programs under this chapter, the United States post office five-digit zip code delivery areas will be used to determine residence status for eligibility purposes. For the purpose of this definition, a zip code delivery area of which any part is ten miles or more from an urbanized area is considered nonurbanized. A zip code totally surrounded by zip codes qualifying as nonurbanized under this definition is also considered nonurbanized. The office of financial management shall make available a zip code listing of the areas to all agencies and organizations providing services under this chapter.
     (19) "Applied baccalaureate degree" means a baccalaureate degree awarded by a college under section 306 of this act for successful completion of a program of study that is:
     (a) Specifically designed for individuals who hold an associate of applied science degree, or its equivalent, in order to maximize application of their technical course credits toward the baccalaureate degree; and
     (b) Based on a curriculum that incorporates both theoretical and applied knowledge and skills in a specific technical field.

Sec. 308   RCW 28B.50.140 and 2004 c 275 s 58 are each amended to read as follows:
     Each board of trustees:
     (1) Shall operate all existing community and technical colleges in its district;
     (2) Shall create comprehensive programs of community and technical college education and training and maintain an open-door policy in accordance with the provisions of RCW 28B.50.090(3). However, technical colleges, and college districts containing only technical colleges, shall maintain programs solely for occupational education, basic skills, and literacy purposes. For as long as a need exists, technical colleges may continue those programs, activities, and services they offered during the twelve-month period preceding September 1, 1991;
     (3) Shall employ for a period to be fixed by the board a college president for each community and technical college and, may appoint a president for the district, and fix their duties and compensation, which may include elements other than salary. Compensation under this subsection shall not affect but may supplement retirement, health care, and other benefits that are otherwise applicable to the presidents as state employees. The board shall also employ for a period to be fixed by the board members of the faculty and such other administrative officers and other employees as may be necessary or appropriate and fix their salaries and duties. Compensation and salary increases under this subsection shall not exceed the amount or percentage established for those purposes in the state appropriations act by the legislature as allocated to the board of trustees by the state board for community and technical colleges. The state board for community and technical colleges shall adopt rules defining the permissible elements of compensation under this subsection;
     (4) May establish, under the approval and direction of the college board, new facilities as community needs and interests demand. However, the authority of boards of trustees to purchase or lease major off-campus facilities shall be subject to the approval of the higher education coordinating board pursuant to RCW 28B.76.230;
     (5) May establish or lease, operate, equip and maintain dormitories, food service facilities, bookstores and other self-supporting facilities connected with the operation of the community and technical college;
     (6) May, with the approval of the college board, borrow money and issue and sell revenue bonds or other evidences of indebtedness for the construction, reconstruction, erection, equipping with permanent fixtures, demolition and major alteration of buildings or other capital assets, and the acquisition of sites, rights-of-way, easements, improvements or appurtenances, for dormitories, food service facilities, and other self-supporting facilities connected with the operation of the community and technical college in accordance with the provisions of RCW 28B.10.300 through 28B.10.330 where applicable;
     (7) May establish fees and charges for the facilities authorized hereunder, including reasonable rules ((and regulations)) for the government thereof, not inconsistent with the rules ((and regulations)) of the college board; each board of trustees operating a community and technical college may enter into agreements, subject to rules ((and regulations)) of the college board, with owners of facilities to be used for housing regarding the management, operation, and government of such facilities, and any board entering into such an agreement may:
     (a) Make rules ((and regulations)) for the government, management and operation of such housing facilities deemed necessary or advisable; and
     (b) Employ necessary employees to govern, manage and operate the same;
     (8) May receive such gifts, grants, conveyances, devises and bequests of real or personal property from private sources, as may be made from time to time, in trust or otherwise, whenever the terms and conditions thereof will aid in carrying out the community and technical college programs as specified by law and the ((regulations)) rules of the state college board; sell, lease or exchange, invest or expend the same or the proceeds, rents, profits and income thereof according to the terms and conditions thereof; and adopt ((regulations)) rules to govern the receipt and expenditure of the proceeds, rents, profits and income thereof;
     (9) May establish and maintain night schools whenever in the discretion of the board of trustees it is deemed advisable, and authorize classrooms and other facilities to be used for summer or night schools, or for public meetings and for any other uses consistent with the use of such classrooms or facilities for community and technical college purposes;
     (10) May make rules ((and regulations)) for pedestrian and vehicular traffic on property owned, operated, or maintained by the district;
     (11) Shall prescribe, with the assistance of the faculty, the course of study in the various departments of the community and technical college or colleges under its control, and publish such catalogues and bulletins as may become necessary;
     (12) May grant to every student, upon graduation or completion of a course of study, a suitable diploma, ((nonbaccalaureate)) degree, or certificate. Technical colleges shall offer only ((nonbaccalaureate)) technical or applied baccalaureate degrees under the rules of the state board for community and technical colleges that are appropriate to their work force education and training mission. The primary purpose of ((this)) these degrees is to lead the individual directly to employment in a specific occupation. Technical colleges may not offer transfer degrees. The board, upon recommendation of the faculty, may also confer honorary associate of arts degrees upon persons other than graduates of the community college, in recognition of their learning or devotion to education, literature, art, or science. No degree may be conferred in consideration of the payment of money or the donation of any kind of property;
     (13) Shall enforce the rules ((and regulations)) prescribed by the state board for community and technical colleges for the government of community and technical colleges, students and teachers, and promulgate such rules ((and regulations)) and perform all other acts not inconsistent with law or rules ((and regulations)) of the state board for community and technical colleges as the board of trustees may in its discretion deem necessary or appropriate to the administration of college districts: PROVIDED, That such rules ((and regulations)) shall include, but not be limited to, rules ((and regulations)) relating to housing, scholarships, conduct at the various community and technical college facilities, and discipline: PROVIDED, FURTHER, That the board of trustees may suspend or expel from community and technical colleges students who refuse to obey any of the duly promulgated rules ((and regulations));
     (14) May, by written order filed in its office, delegate to the president or district president any of the powers and duties vested in or imposed upon it by this chapter. Such delegated powers and duties may be exercised in the name of the district board;
     (15) May perform such other activities consistent with this chapter and not in conflict with the directives of the college board;
     (16) Notwithstanding any other provision of law, may offer educational services on a contractual basis other than the tuition and fee basis set forth in chapter 28B.15 RCW for a special fee to private or governmental entities, consistent with rules ((and regulations)) adopted by the state board for community and technical colleges: PROVIDED, That the whole of such special fee shall go to the college district and be not less than the full instructional costs of such services including any salary increases authorized by the legislature for community and technical college employees during the term of the agreement: PROVIDED FURTHER, That enrollments generated hereunder shall not be counted toward the official enrollment level of the college district for state funding purposes;
     (17) Notwithstanding any other provision of law, may offer educational services on a contractual basis, charging tuition and fees as set forth in chapter 28B.15 RCW, counting such enrollments for state funding purposes, and may additionally charge a special supplemental fee when necessary to cover the full instructional costs of such services: PROVIDED, That such contracts shall be subject to review by the state board for community and technical colleges and to such rules as the state board may adopt for that purpose in order to assure that the sum of the supplemental fee and the normal state funding shall not exceed the projected total cost of offering the educational service: PROVIDED FURTHER, That enrollments generated by courses offered on the basis of contracts requiring payment of a share of the normal costs of the course will be discounted to the percentage provided by the college;
     (18) Shall be authorized to pay dues to any association of trustees that may be formed by the various boards of trustees; such association may expend any or all of such funds to submit biennially, or more often if necessary, to the governor and to the legislature, the recommendations of the association regarding changes which would affect the efficiency of such association;
     (19) May participate in higher education centers and consortia that involve any four-year public or independent college or university: PROVIDED, That new degree programs or off-campus programs offered by a four-year public or independent college or university in collaboration with a community or technical college are subject to approval by the higher education coordinating board under RCW 28B.76.230; and
     (20) Shall perform any other duties and responsibilities imposed by law or rule ((and regulation)) of the state board.

Sec. 309   RCW 28B.15.069 and 2003 c 232 s 5 are each amended to read as follows:
     (1) The building fee for each academic year shall be 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 for each tuition category in the 1994-95 academic year, rounded up to the nearest half percent.
     (2) The governing boards of each institution of higher education, except for the technical colleges, shall charge to and collect from each student a services and activities fee. A 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 student tuition fees for resident undergraduate students: 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. These rate adjustments may exceed the fiscal growth factor. For the 2003-04 academic year, the services and activities fee shall be based upon the resident undergraduate services and activities fee in 2002-03. 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.
     (3) Tuition and services and activities fees consistent with subsection (2) of this section shall be set by the state board for community and technical colleges for community college summer school students unless the community college charges fees in accordance with RCW 28B.15.515.
     (4) Subject to the limitations of RCW 28B.15.910, each governing board of a community college may charge such fees for ungraded courses, noncredit courses, community services courses, and self-supporting courses as it, in its discretion, may determine, consistent with the rules of the state board for community and technical colleges.
     (5) The governing board of a community or technical college offering an applied baccalaureate degree program under section 306 of this act may charge tuition fees for those courses above the associate degree level at rates consistent with rules adopted by the state board for community and technical colleges, not to exceed tuition fee rates at the regional universities.

NEW SECTION.  Sec. 401   (1) The legislature finds that, since 1997, public institutions of higher education have developed and maintained a system of performance measures to monitor progress in improving graduation efficiency, faculty productivity, student achievement of degrees and certifications, and other topics. However, the current performance measurement system is too limited in scope and scale. Only a few measures reflect the unique role and mission of an institution. There is little dialogue between state policymakers and institution leaders regarding the challenges facing our colleges and universities and the outcomes expected by the public and the state.
     (2) The legislature further finds that procedures for operating budgets, enrollment management, and strategic planning for higher education are not adequately coordinated. The state and institutions must jointly discuss and establish clear priorities and acknowledge potential trade-offs of funding decisions.
     (3) Therefore, the legislature intends to explore a new relationship between the state and public institutions of higher education that includes dialogue and negotiation over goals, priorities, performance, and resources, and also includes explicit commitments made by each party aimed at achieving agreed-upon outcomes. The mechanism to implement this relationship is a performance contract.

NEW SECTION.  Sec. 402   As used in this chapter, a performance contract:
     (1) Is an agreement reached between the state and the governing board of an institution of higher education, or in the case of community or technical colleges the state board for community and technical colleges, as provided in section 404 of this act and approved by the legislature as provided in section 407 of this act;
     (2) Addresses statewide goals and priorities of the legislature;
     (3) Specifies enrollment and resource levels;
     (4) Contains goals and commitments from both the institution and the state;
     (5) Includes quantifiable performance measures and benchmarks; and
     (6) Reflects the unique role and mission of the institution within the state's higher education system.

NEW SECTION.  Sec. 403   (1) The higher education coordinating board, in consultation with the governor's office and the office of financial management, shall enter into negotiations with the governing boards of the state universities, the regional universities, and the state college, as defined in RCW 28B.10.016, to create a performance contract with each institution.
     (2) The governor's office with assistance from the higher education coordinating board and the office of financial management shall enter into negotiations with the state board for community and technical colleges to create a master performance contract with the system of community and technical colleges created under chapter 28B.50 RCW.
     (3) In developing a contract, the negotiating team from an institution of higher education must involve student and faculty representatives.
     (4) The term of a performance contract negotiated under this section is six years, however either party may request that a contract be renegotiated and updated on a biennial basis if necessary to reflect changed circumstances. All performance contracts must include a process for renegotiation or update.
     (5) The institutions of higher education and state board for community and technical colleges shall report all data necessary to implement, evaluate, and monitor each performance contract to the office of financial management, the legislature, and the higher education coordinating board.

NEW SECTION.  Sec. 404   (1) Performance contracts shall contain:
     (a) Indicators that measure outcomes concerning cost, quality, timeliness of student progress toward degrees and certifications, and articulation between and within the K-12 and higher education systems;
     (b) Each institution's share of enrollments and degrees needed to meet the state's goals and strategic direction;
     (c) Indicators that measure the efficiency and effectiveness of institutional processes; and
     (d) Strategies, actions, and results committed to by the institution in order to achieve statewide goals.
     (2) Performance contracts shall also identify the level of resources necessary to meet the performance objectives, subject to approval by the legislature under section 407 of this act.
     (3) The governor and institutional negotiating teams shall identify indicators and levels of performance that are clearly linked to the role, mission, and strategic plan of the institution.

NEW SECTION.  Sec. 405   (1) Performance contracts shall include grants to the institution, under the terms of the contract, of flexibility or waivers from state controls or rules.
     (2) The negotiating teams shall identify areas where statutory change is necessary to grant an institution flexibility or waivers of state agency rules and submit any legislation necessary to implement a performance contract to the higher education committees of the senate and house of representatives.
     (3) The following areas may not be included in a performance contract:
     (a) Flexibility or waivers of requirements in a collective bargaining agreement negotiated under chapter 28B.52, 41.56, 41.59, 41.76, or 41.80 RCW;
     (b) Flexibility or waivers of administrative rules or processes governed by chapter 28B.52, 41.56, 41.59, 41.76, or 41.80 RCW;
     (c) Rules, processes, duties, rights, and responsibilities of the academic faculty as contained in the faculty codes of the four-year institution;
     (d) Flexibility or waivers of requirements under chapter 39.12 RCW;
     (e) Flexibility or waivers of administrative rules or other regulations that address health and safety, civil rights, and nondiscrimination laws that apply to institutions of higher education; and
     (f) State laws covering terms and conditions of employment, including but not limited to salaries, job security, and health, retirement, unemployment, or any other employment benefits.

NEW SECTION.  Sec. 406   (1) The higher education coordinating board and the governor's office shall submit completed performance contracts to the legislature by January 15, 2006, and every six years thereafter. Following public hearings, the legislature shall have the opportunity, by concurrent resolution, to approve or reject each performance contract as a whole.
     (2) If the legislature rejects or fails to act on a submission, the performance contract shall be returned to the parties for renegotiation.
     (3) All cost items contained within a performance contract are subject to legislative appropriation.

NEW SECTION.  Sec. 407   (1) Beginning December 2006, the higher education coordinating board and the state board for community and technical colleges shall provide annual progress reports to the higher education committees of the senate and house of representatives on implementation of the performance contracts and any short-term outcomes. The overall purpose of the progress reports is to focus attention on key measures of institutional performance and gain an improved understanding of the causes of success or lack of success in making progress in achieving the goals in the contract.
     (2) The joint legislative audit and review committee shall conduct an evaluation and make recommendations regarding changes to the substance or process of performance contracting. The evaluation shall be submitted to the governor and higher education committees of the senate and house of representatives by January 15, 2012.

Sec. 408   RCW 28B.50.090 and 2004 c 275 s 57 are each amended to read as follows:
     The college board shall have general supervision and control over the state system of community and technical colleges. In addition to the other powers and duties imposed upon the college board by this chapter, the college board shall be charged with the following powers, duties and responsibilities:
     (1) Review the budgets prepared by the boards of trustees, prepare a single budget for the support of the state system of community and technical colleges and adult education, and submit this budget to the governor as provided in RCW 43.88.090;
     (2) Establish guidelines for the disbursement of funds; and receive and disburse such funds for adult education and maintenance and operation and capital support of the college districts in conformance with the state and district budgets, and in conformance with chapter 43.88 RCW;
     (3) Ensure, through the full use of its authority:
     (a) That each college district shall offer thoroughly comprehensive educational, training and service programs to meet the needs of both the communities and students served by combining high standards of excellence in academic transfer courses; realistic and practical courses in occupational education, both graded and ungraded; and community services of an educational, cultural, and recreational nature; and adult education, including basic skills and general, family, and work force literacy programs and services. However, technical colleges, and college districts containing only technical colleges, shall maintain programs solely for occupational education, basic skills, and literacy purposes. For as long as a need exists, technical colleges may continue those programs, activities, and services they offered during the twelve-month period preceding May 17, 1991;
     (b) That each college district shall maintain an open-door policy, to the end that no student will be denied admission because of the location of the student's residence or because of the student's educational background or ability; that, insofar as is practical in the judgment of the college board, curriculum offerings will be provided to meet the educational and training needs of the community generally and the students thereof; and that all students, regardless of their differing courses of study, will be considered, known and recognized equally as members of the student body: PROVIDED, That the administrative officers of a community or technical college may deny admission to a prospective student or attendance to an enrolled student if, in their judgment, the student would not be competent to profit from the curriculum offerings of the college, or would, by his or her presence or conduct, create a disruptive atmosphere within the college not consistent with the purposes of the institution. This subsection (3)(b) shall not apply to competency, conduct, or presence associated with a disability in a person twenty-one years of age or younger attending a technical college;
     (4) Prepare a comprehensive master plan for the development of community and technical college education and training in the state; and assist the office of financial management in the preparation of enrollment projections to support plans for providing adequate college facilities in all areas of the state. The master plan shall include implementation of the vision, goals, priorities, and strategies in the statewide strategic master plan for higher education under RCW 28B.76.200 based on the community and technical college system's role and mission. The master plan shall also contain measurable performance indicators and benchmarks for gauging progress toward achieving the goals and priorities;
     (5) Define and administer criteria and guidelines for the establishment of new community and technical colleges or campuses within the existing districts;
     (6) Establish criteria and procedures for modifying district boundary lines consistent with the purposes set forth in RCW 28B.50.020 as now or hereafter amended and in accordance therewith make such changes as it deems advisable;
     (7) Establish minimum standards to govern the operation of the community and technical colleges with respect to:
     (a) Qualifications and credentials of instructional and key administrative personnel, except as otherwise provided in the state plan for vocational education,
     (b) Internal budgeting, accounting, auditing, and financial procedures as necessary to supplement the general requirements prescribed pursuant to chapter 43.88 RCW,
     (c) The content of the curriculums and other educational and training programs, and the requirement for degrees and certificates awarded by the colleges,
     (d) Standard admission policies,
     (e) Eligibility of courses to receive state fund support;
     (8) Establish and administer criteria and procedures for all capital construction including the establishment, installation, and expansion of facilities within the various college districts;
     (9) Encourage innovation in the development of new educational and training programs and instructional methods; coordinate research efforts to this end; and disseminate the findings thereof;
     (10) Exercise any other powers, duties and responsibilities necessary to carry out the purposes of this chapter;
     (11) Authorize the various community and technical colleges to offer programs and courses in other districts when it determines that such action is consistent with the purposes set forth in RCW 28B.50.020 as now or hereafter amended;
     (12) Notwithstanding any other law or statute regarding the sale of state property, sell or exchange and convey any or all interest in any community and technical college real and personal property, except such property as is received by a college district in accordance with RCW 28B.50.140(8), when it determines that such property is surplus or that such a sale or exchange is in the best interests of the community and technical college system;
     (13) In order that the treasurer for the state board for community and technical colleges appointed in accordance with RCW 28B.50.085 may make vendor payments, the state treasurer will honor warrants drawn by the state board providing for an initial advance on July 1, 1982, of the current biennium and on July 1 of each succeeding biennium from the state general fund in an amount equal to twenty-four percent of the average monthly allotment for such budgeted biennium expenditures for the state board for community and technical colleges as certified by the office of financial management; and at the conclusion of such initial month and for each succeeding month of any biennium, the state treasurer will reimburse expenditures incurred and reported monthly by the state board treasurer in accordance with chapter 43.88 RCW: PROVIDED, That the reimbursement to the state board for actual expenditures incurred in the final month of each biennium shall be less the initial advance made in such biennium;
     (14) Notwithstanding the provisions of subsection (12) of this section, may receive such gifts, grants, conveyances, devises, and bequests of real or personal property from private sources as may be made from time to time, in trust or otherwise, whenever the terms and conditions thereof will aid in carrying out the community and technical college programs and may sell, lease or exchange, invest or expend the same or the proceeds, rents, profits and income thereof according to the terms and conditions thereof; and adopt regulations to govern the receipt and expenditure of the proceeds, rents, profits and income thereof;
     (15) The college board shall have the power of eminent domain;
     (16) Provide general supervision over the state's technical colleges. The president of each technical college shall report directly to the director of the state board for community and technical colleges, or the director's designee, until local control is assumed by a new or existing board of trustees as appropriate, except that a college president shall have authority over program decisions of his or her college until the establishment of a board of trustees for that college. The directors of the vocational-technical institutes on March 1, 1991, shall be designated as the presidents of the new technical colleges; and
     (17) Enter into negotiations to create a master performance contract for the system of community and technical colleges as provided in chapter 28B.-- RCW (sections 401 through 407 of this act).

Sec. 409   RCW 28B.76.290 and 1993 c 77 s 2 are each amended to read as follows:
     The board shall coordinate educational activities among all segments of higher education taking into account the educational programs, facilities, and other resources of both public and independent two and four-year colleges and universities. The four-year institutions and the state board for community and technical colleges shall coordinate information and activities with the board. The board shall have the following additional responsibilities:
     (1) Promote interinstitutional cooperation;
     (2) Establish minimum admission standards for four-year institutions, including a requirement that coursework in American sign language or an American Indian language shall satisfy any requirement for instruction in a language other than English that the board or the institutions may establish as a general undergraduate admissions requirement;
     (3) Establish transfer policies;
     (4) Adopt rules implementing statutory residency requirements;
     (5) Develop and administer reciprocity agreements with bordering states and the province of British Columbia;
     (6) Review and recommend compensation practices and levels for administrative employees, exempt under chapter ((28B.16)) 41.06 RCW, and faculty using comparative data from peer institutions;
     (7) Monitor higher education activities for compliance with all relevant state policies for higher education;
     (8) Arbitrate disputes between and among four-year institutions or between and among four-year institutions and community colleges at the request of one or more of the institutions involved, or at the request of the governor, or from a resolution adopted by the legislature. The decision of the board shall be binding on the participants in the dispute;
     (9) Establish and implement a state system for collecting, analyzing, and distributing information;
     (10) Recommend to the governor and the legislature ways to remove any economic incentives to use off-campus program funds for on-campus activities; ((and))
     (11) Make recommendations to increase minority participation, and monitor and report on the progress of minority participation in higher education; and
     (12) Enter into negotiations to create performance contracts with the governing boards of the public four-year institutions as provided in chapter 28B.-- RCW (sections 401 through 407 of this act).

NEW SECTION.  Sec. 410   RCW 28B.76.270 (Accountability monitoring and reporting system -- Institution biennial plans and performance targets -- Biennial reports to the legislature) and 2004 c 275 s 11 are each repealed.

NEW SECTION.  Sec. 501   Part headings used in this act are not any part of the law.

NEW SECTION.  Sec. 502   Sections 401 through 407 of this act constitute a new chapter in Title 28B RCW.