SENATE BILL REPORT

SB 5463

BYSenators McDonald and Gaspard; by request of Governor

Regarding building fees for higher education.

Senate Committee on Ways & Means

Senate Hearing Date(s):March 1, 1989; February 1, 1990; February 5, 1990

Majority Report:  That Substitute Senate Bill No. 5463 be substituted therefor, and the substitute bill do pass.

      Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Amondson, Bluechel, Cantu, Hayner, Johnson, Lee, Matson, Newhouse, Niemi, Owen.

Minority Report:  That it not be substituted.

      Signed by Senators Bauer, Fleming, Gaspard, Talmadge, Warnke, Williams.

Senate Staff:Linda Brownell (786-7913)

                  February 7, 1990

AS REPORTED BY COMMITTEE ON WAYS & MEANS, FEBRUARY 5, 1990

BACKGROUND:

Under current law, the tuition to be paid by fulltime students at the state's two and four year colleges and universities is expressed as a percentage of the educational costs of the schools.  While the tuition payments are deposited in the state general fund, a portion is retained by the school to fund capital construction and maintenance projects at the school.  This portion, known as the "building fee," is a fixed-dollar amount that ranges from $76.50 for resident students at the regional universities to $550 for nonresident medical, dental, and veterinary graduate students.  While the tuition rate increases as educational costs rise, the building fees have not been changed since 1981.

SUMMARY:

Beginning July 1, 1991, the building fee is calculated as a percentage of the tuition paid.  The percentage is increased annually over a four-year period as follows:

!tp1,4,1,1,1,1 !tj1!tl FY92!tlFY93!tlFY94!tlFY95

!tlUndergraduates:!tl 8.75%!tl10.5%!tl12.25%!tl14.0%

!tlGraduates:!tl 7.75%!tl11.5%!tl14.75%!tl 18.0%

!tlCommunity college:!tl20.00%!tl20.0%!tl20.00%!tl20.0%

EFFECT OF PROPOSED SUBSTITUTE:

Beginning July 1, 1991, the building fee will be fixed at 9 percent of tuition for the four-year institutions and 20 percent for the community colleges.

In addition, the governing boards of each institution will be able to impose a building fee surcharge of up to 10 percent of total tuition.  This building fee surcharge will be matched by an equal amount of operating revenues.  The total building fee, surcharge and match is to be deposited in each institution's building fund for capital construction purposes, subject to appropriation.  These funds may be bonded against or used on a cash basis.  In the case of the community college system, the surcharge and match would not be obligated to pay off past capital projects.

The bill contains intent language which would incorporate the "24 percent financial aid calculation," and student services and activities fees committees would have to be consulted.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: Bob Edie, University of Washington (pro); Bev Lingle, Washington State University (pro); Bill Julius, State Board for Community College Education (pro); Judy McNickle, Western Washington University (pro); Jennifer Jaech, The Evergreen State College (pro); Mike Bigelow, Office of Financial Management (pro/con); Scott LaFramboise, Washington Student Lobby (con)