HOUSE BILL REPORT

ESB 5215

As Amended by the House

BYSenators Saling, Bauer, West, Smitherman, Lee, Fleming and Rinehart; by request of Governor

Authorizing financial aid to needy students enrolled on at least a half-time basis.

House Committe on Higher Education

Majority Report:  Do pass with amendments.  (13)

      Signed by Representatives Jacobsen, Chair; Spanel, Vice Chair; Van Luven, Ranking Republican Member; Doty, Fraser, Heavey, Inslee, Jesernig, Miller, H. Myers, Prince, Rector and Wood.

House Staff:Susan Hosch (786-7210) and Joan Elgee (786-7166)

Rereferred House Committee on Appropriations

Majority Report:  Do pass as amended by Committee on Higher Education.  (16)

      Signed by Representatives Locke, Chair; Grant, Vice Chair; Youngsman, Assistant Ranking Republican Member; Appelwick, Bowman, Brekke, Brough, Dorn, Hine, Nealey, Peery, Rust, Sayan, Spanel, Valle and Wang.

Minority Report:  Do not pass.  (3)

      Signed by Representatives Ferguson, May and McLean.

House Staff:      Sherie Story (786-7136)

AS PASSED HOUSE APRIL 11, 1989

BACKGROUND:

Washington has a variety of financial aid programs designed to assist needy students.  The State Need Grant Program is one of the major aid programs funded by the state.  The program is administered by the Higher Education Coordinating Board, and is available to state residents attending a public or private postsecondary institution located within the state.

By law, benefits of the State Need Grant Program are available only to full-time needy students or to disadvantaged students who are unable to qualify for enrollment as full-time students. A student's eligibility to receive a need grant is limited to four academic years.

During 1988, the Board undertook an extensive review of the State Need Grant Program.  The Board is recommending a series of program revisions. Recommendations that do not require a statutory change include revising the award formula to recognize the real cost of college or university attendance, and providing parents with a dependent care allowance of $400 per academic year for full-time students and $200 per academic year for part-time students.

The Board has recommended statutory changes that would permit part time students taking six or more credits to be eligible for a State Need Grant. Students enrolled for six to eight credits would receive one-half of the grant amount.  Students enrolled in nine to 11 credits would receive three-fourths of the grant amount. The Board has also recommended a statutory change to permit students to receive a grant for five years of undergraduate work. The Board estimates that making these statutory changes will increase the number of persons eligible for a need grant by about 2,600 students during the 1989-91 biennium.

In 1977, the Legislature adopted a new statutory mechanism for setting tuition. Tuition is based on a statutory percentage of educational costs, and is automatically adjusted every two years to reflect that cost.  Out of concern about the effect of this new policy on needy students, the Legislature included a provision in the 1977 legislation recommending that state appropriations for student financial aid (less federal funds available as Pell Grants) equal 24 percent of any revenue increase resulting from increased tuition and fees.

According to the Board, the 24 percent formula was originally derived by determining the proportion of full-time needy students compared to the entire full-time college population.  Using the same methodology today, the formula would equal 35 percent.  The Board has recommended revising the statute to raise the percentage used to determine adjustments to state financial aid programs to 35 percent, beginning July 1, 1991. The Board has also recommended inserting a clause that would automatically adjust the percentage annually to reflect the changes in needy financial aid applicants as a share of total enrollment.

SUMMARY:

Needy and disadvantaged students who are enrolled at an institution of higher education on at least a half-time basis are eligible to participate in the State Need Grant Program. Students will be eligible to continue participating in the program for five academic years.

The legislative recommendation that appropriations for student financial aid equal 24 percent of any change in revenue resulting from increased tuition and fees is changed to 35 percent. Appropriations resulting from the percentage increase are to be used for the State Need Grant Program.

Fiscal Note:      Requested March 28, 1989.

Effective Date:Section 5 contains an emergency clause and takes effect immediately.

House Committee ‑ Testified For:    (Higher Education) Rose Ferri, Centralia College; Jim Chicatelli, University of Puget Sound; John Klacik, Higher Education Coordinating Board; Laurie McGlothlin, Washington Association of Community College Students; Jan Yoshiwara, State Board for Community College Education; Stephanie Adams and Elizabeth Woody, Washington Student Lobby.

(Appropriations) Stephanie Adams and Elizabeth Woody, Washington Student Lobby.

House Committee - Testified Against:      (Higher Education) None Presented.

(Appropriations) None Presented.

House Committee - Testimony For:    (Higher Education) Allowing students attending school part-time to receive financial aid will help those with family responsibilities who are unable to attend full-time.  The current four year restriction on receiving aid is too limiting for many students.  Students who require remedial education, those changing majors, and those studying in professional areas with many requirements all may require a fifth year to obtain a degree.

(Appropriations) Allowing students attending school part-time to receive financial aid will help those with family responsibilities who are unable to attend full-time.  The current four year restriction on receiving aid is too limiting for many students.  Students who require remedial education, those changing majors, and those studying in professional areas with many requirements all may require a fifth year to obtain a degree.

The percentage of students needing financial assistance in order to attend a college or university has increased from 24 percent in the mid 1970s to 35 percent today.  The increased number of needy students has put significant pressure on the state's financial aid programs.  Many of the state's neediest students are not being served due to lack of funds.

House Committee - Testimony Against:      (Higher Education) None Presented.

(Appropriations) None Presented.