BILL REQ. #:  H-4884.1 

READ FIRST TIME 02/02/10.   

     AN ACT Relating to higher education performance agreements; amending RCW 28B.10.920, 28B.10.921, 28B.10.922, and 44.28.156; and creating a new section.

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

NEW SECTION.  Sec. 1   (1) The legislature finds that significant progress has been made through a number of plans and policies to establish coherent and transparent funding and policy objectives, resources, and expectations for Washington's six public four-year institutions of higher education. The legislature established a pilot performance agreement process to implement these plans and policies.
     (2) Developing performance agreements at each of the public four-year institutions of higher education will provide that the proper balance of tuition, state support, and financial aid will be tied to each institution's unique role, mission, student profile, and contribution to achieving the goals of the state's strategic master plan for higher education.
     (3) The legislature finds that aligning and simplifying the process for preparing, submitting, and processing performance agreements for the six public four-year institutions with the state budget process is necessary to provide adequate time for negotiation and deliberation.
     (4) A forum should be created to develop an agreement among policymakers and institution leaders about how institutions' strategic plans, resources, and outcomes align with the state higher education strategic master plan, as adopted by the legislature, for a planning horizon of six years.
     (5) Beginning in 2010, each public four-year institution of higher education should develop a performance agreement that will be submitted in conjunction with its biennial budget request.

Sec. 2   RCW 28B.10.920 and 2008 c 160 s 2 are each amended to read as follows:
     (1) As used in this section and RCW 28B.10.921 and 28B.10.922, a performance agreement is an agreement reached between the state and the governing board of an institution of higher education and approved by the legislature using the process provided in RCW 28B.10.922.
     (2) The purpose of a performance agreement is to develop and communicate a six-year ((plan)) agreement developed jointly by state policymakers and an institution of higher education that aligns goals, priorities, desired outcomes, flexibility, institutional mission, accountability, and levels of resources.
     (((3) Beginning in 2008, performance agreements shall be pilot-tested with the public four-year institutions of higher education.))

Sec. 3   RCW 28B.10.921 and 2008 c 160 s 3 are each amended to read as follows:
     (1) Performance agreements shall address but not be limited to the following issues:
     (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) Benchmarks and goals for long-term degree production, including discrete benchmarks and goals in ((particular fields of study)) areas of critical state need including but not limited to high employer demand programs of study;
     (c) The level of state resources and tuition revenue necessary to meet the performance outcomes, benchmarks, and goals, with state resources, subject to legislative appropriation;
     (d) ((The prioritization of four-year institution capital budget projects by the office of financial management)) Any additional measures that an institution may deem a priority in meeting state or institutional strategic planning goals; and
     (e) Indicators that measure outcomes concerning ((recruitment)) enrollment, retention, and success of students((, faculty, and staff)) from diverse, underrepresented ((communities)), and low-income groups.
     (2) The goals and outcomes identified in a performance agreement shall be linked to the role, mission, and strategic plan of the institution of higher education and aligned with the statewide strategic master plan for higher education.
     (3) Performance agreements may also ((include grants to)) provide an institution((, under the terms of the agreement, of)) with flexibility ((or waivers from)) in administering or waiving state controls or rules. The agreement may identify ((areas where)) statutory changes ((is)) necessary to grant an institution such flexibility or waivers of state agency rules.
     (4) ((The following areas may not be included in a)) Performance agreements may not include:
     (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.

Sec. 4   RCW 28B.10.922 and 2008 c 160 s 4 are each amended to read as follows:
     (1) A state performance agreement committee is created to represent the state in developing performance agreements under this section and RCW 28B.10.920 and 28B.10.921. The committee is composed of one representative((s)) from the governor's office((,)); one representative from the office of financial management((,)); two representatives from the higher education coordinating board((, the office of the superintendent of public instruction, two members of the senate appointed by the secretary of the senate, and two members of the house of representatives appointed by the speaker of the house of representatives)) appointed by the board, one of whom is the executive director; the chairs of the appropriate house of representatives and senate policy committees or their designees; the chair of an appropriate house of representatives fiscal committee, or the chair's designee; the chair of an appropriate senate fiscal committee, or the chair's designee; and one member each from the house of representatives and the senate minority caucuses appointed by the speaker of the house of representatives and president of the senate, respectively. The executive director of the higher education coordinating board shall serve as chair of the state performance agreement committee. The state performance agreement committee shall be staffed by personnel from the higher education coordinating board.
     (2) ((Each of the participating institutions shall develop a preliminary draft of a performance agreement with input from students and faculty. The governing boards of the public four-year institutions of higher education shall designate performance agreement representatives for each institution respectively that shall include two faculty members at those institutions bargaining under chapter 41.76 RCW, at least one of whom shall be appointed by the exclusive collective bargaining agent and the other appointed by the faculty governance organization of that institution. If the participating pilot institution does not bargain under chapter 41.76 RCW, then two faculty members shall be appointed by the faculty governance organization of that institution. The associated student governments or their equivalents shall designate two performance agreement representatives at those institutions. Starting with the preliminary drafts, the state performance agreement committee and representatives of each institution shall develop revised draft performance agreements for each institution and submit the revised drafts to the governor and the fiscal and higher education committees of the legislature no later than September 1, 2008.)) In preparation for the 2011-2013 biennium, each of the state's four-year institutions of higher education shall develop a preliminary draft performance agreement with input from students and faculty. The governing boards of the public four-year institutions of higher education shall designate performance agreement representatives for each institution respectively that shall include two faculty members at those institutions bargaining under chapter 41.76 RCW, at least one of whom shall be appointed by the exclusive collective bargaining agent and the other appointed by the faculty governance organization of that institution. If the participating pilot institution does not bargain under chapter 41.76 RCW, then two faculty members shall be appointed by the faculty governance organization of that institution. The associated student governments or their equivalents shall designate two performance agreement representatives at those institutions. Once the preliminary draft is developed by the institution, representatives of the state committee and institution leadership shall engage in a series of meetings to negotiate a proposed performance agreement that shall be submitted to the full state committee for consideration and action by September 15, 2010. Once the state committee has agreed to recommend the performance agreement, it shall be submitted to the governor's office and the office of financial management by October 1, 2010, for consideration by the governor for inclusion in the governor's 2011-2013 operating budget recommendations.
     (3) ((After receiving informal input on the revised draft performance agreements, particularly regarding the levels of resources assumed in the agreements, the state committee and institution representatives shall develop final proposed performance agreements and submit the agreements to the governor and the office of financial management by November 1, 2008, for consideration in development of the governor's 2009-2011 operating and capital budget recommendations.
     (4))) The state committee ((shall)) may submit any legislation necessary to implement a performance agreement to the ((higher education)) appropriate committees of the senate and house of representatives.
     (((5))) (4) All cost items contained within a performance agreement are subject to legislative appropriation.
     (((6))) (5) If the legislature affirms, through a proviso ((in the 2009-2011 omnibus appropriations act)), that the enacted omnibus appropriations act ((and the 2009 capital budget act enacted by the legislature)) aligns with the proposed performance agreements, the performance agreements shall take effect beginning July 1, ((2009)) 2011, through June 30, ((2015)) 2017. If the legislature affirms, through a proviso ((in the 2009-2011 omnibus appropriations act)) or through inaction, that the omnibus appropriations act ((and/or the 2009 capital budget act are)) is not aligned with the proposed performance agreements, the state committee and institution ((representatives)) leadership shall ((redraft the agreements to align with the enacted budgets, and the redrafted agreements shall take effect beginning September 1, 2009, through June 30, 2015)) reconvene to agree upon necessary adjustments to the performance agreements to align funding provided by the enacted omnibus appropriations act with agreed indicators and outcomes, in which case the performance agreements shall take effect beginning September 1, 2011, through June 30, 2017.
     (((7))) (6) The legislature, ((the)) state committee, and ((the)) institution ((representatives)) leadership shall repeat the process described in subsections (((6))) (2) through (5) of this section for each subsequent omnibus appropriations ((and capital budget)) act enacted between the 2010 and ((2014)) 2015 legislative sessions to ensure that the performance agreements are updated as necessary to align with enacted omnibus appropriations ((and capital budget)) acts.

Sec. 5   RCW 44.28.156 and 2008 c 160 s 5 are each amended to read as follows:
     The joint committee shall conduct an evaluation of the higher education performance agreements ((pilot test)) under RCW 28B.10.920 through 28B.10.922 and make recommendations regarding changes to the substance or process of creating the agreements, including whether the performance agreement process should be continued and expanded to include additional higher education institutions. The evaluation shall be submitted to the governor and the higher education committees of the senate and house of representatives by November 1, ((2014)) 2017.