H-2250

AN ACT Relating to financial aid; amending RCW 28B.10.800, 28B.10.802, 28B.10.804, 28B.10.806, 28B.10.808, 28B.10.810, 28B.10.822, 28B.101.010, 28B.101.020, and 28B.101.030; reenacting and amending RCW 28B.101.040; adding a new section to chapter 28B.10 RCW; creating new sections; and making appropriations.

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

NEW SECTION. Sec. 1. A new section is added to chapter 28B.10 RCW to read as follows:

The legislature finds that state funded financial aid programs need to be restructured and better funded. The legislature also finds that:

(1) In most circumstances, need grant eligibility should not extend beyond four years plus one academic term or the credit or clock hour equivalent;

(2) In most circumstances, need grant eligibility should not extend beyond the published length of the program in which the student is enrolled plus one academic term;

(3) In most circumstances, need grant eligibility for lower division students should not extend beyond two years plus one academic term, or the credit or clock-hour equivalent;

(4) The higher education coordinating board should enhance its financial aid information outreach program. The board should make a special effort to provide information to the parents of students in middle school and junior high school;

(5) State financial aid programs should continue to adhere to the principle that funding follows resident students to their choice of institution of higher education; and

(6) The educational opportunity grant program should be expanded to include needy upper division students from any area of the state.

NEW SECTION. Sec. 2. In cooperation with students, student aid administrators, employers, public and independent institutions of higher education, private career schools and colleges, and other interested parties, the higher education coordinating board shall continue to evaluate and refine the thoughtful recommendations of its 1995-96 financial aid task force. As part of its effort, for the purpose of determining need grant eligibility, the board shall consult experts to establish a method of evaluating family income that, as accurately as possible, reflects the student's and his or her family's ability to pay college expenses. When evaluating ability to pay, the higher education coordinating board shall take into account factors that include, but need not be limited to: All sources of gift aid, employment, income, and living assistance available to students and their families. The higher education coordinating board shall also consider several different methods for determining need grant amounts based on tuition and fees. The methods shall include, but need not be limited to: Tuition and fees at public colleges and universities; the provision of similar grant amounts to all lower division students and to all upper division undergraduate students, regardless of institution attended; and the provision of enhanced grant amounts to upper division students who must relocate to obtain their baccalaureate degrees. In modeling different methods, the board shall assume that the program will continue to serve at least as many students as were served in the 1996-97 academic year without assuming any new funding will be added to the program. In its study, the board may consider other financial aid concerns of students, employers, aid administrators, institutions of higher education, and private career schools and colleges. By December 20, 1997, the board shall report its findings and recommendations to the governor, the house of representatives and senate committees on higher education, and other interested parties. The board may implement a tuition-based need grant program prior to the date this report is due. The board also will gather and analyze information on the extent to which financial aid recipients are enrolled in precollege and developmental courses, and will report the information to the house of representatives and senate committees on higher education.

Sec. 3. RCW 28B.10.800 and 1993 sp.s. c 18 s 2 are each amended to read as follows:

The ((~~sole~~)) purposes of RCW 28B.10.800 through 28B.10.824 ((is)) are to establish the principles upon which the state financial aid programs will be based and to establish a state of Washington ((~~student financial aid~~)) need grant program, thus assisting financially needy or disadvantaged students domiciled in Washington to obtain the opportunity of attending an accredited institution of higher education, as defined in RCW 28B.10.802(1). ((~~Financial aid~~)) Need grants under RCW 28B.10.800 through 28B.10.824 ((is)) are available only to students who are resident students as defined in RCW 28B.15.012(2) (a) through (d).

Sec. 4. RCW 28B.10.802 and 1989 c 254 s 2 are each amended to read as follows:

As used in RCW 28B.10.800 through 28B.10.824:

(1) "Institutions of higher education" shall mean ((~~(1)~~)) (a) any public university, college, community college, or vocational-technical institute operated by the state of Washington or any political subdivision thereof or ((~~(2)~~)) (b) any other university, college, school, or institute in the state of Washington offering instruction beyond the high school level ((~~which~~)) that is a member institution of an accrediting association recognized by rule of the board for the purposes of this section: PROVIDED, That any institution, branch, extension or facility operating within the state of Washington which is affiliated with an institution operating in another state must be a separately accredited member institution of any such accrediting association: PROVIDED FURTHER, That no institution of higher education shall be eligible to participate in ((~~a student financial aid~~)) the state need grant program unless it agrees to and complies with program rules and regulations adopted pursuant to RCW 28B.10.822.

(2) The term "financial aid" shall mean ((~~loans and/or~~)) grants ((to)) and work study for needy students enrolled or accepted for enrollment as ((a)) students at institutions of higher education.

(3) The term "needy student" shall mean a post high school student of an institution of higher learning as defined in subsection (1) of this section who demonstrates to the board the financial inability, either through the student's parents, family and/or personally, to meet the total cost of board, room, books, and tuition and incidental fees for any semester or quarter.

(4) The term "disadvantaged student" shall mean a post high school student who by reason of adverse cultural, educational, environmental, experiential, familial or other circumstances is unable to qualify for enrollment as a full time student in an institution of higher learning, who would otherwise qualify as a needy student, and who is attending an institution of higher learning under an established program designed to qualify the student for enrollment as a full time student.

(5) "Commission" or "board" shall mean the higher education coordinating board.

Sec. 5. RCW 28B.10.804 and 1995 c 269 s 801 are each amended to read as follows:

The ((~~commission~~)) board shall be cognizant of the following guidelines in the performance of its duties:

(1) The ((~~commission~~)) board shall be research oriented, not only at its inception but continually through its existence.

(2) The ((~~commission~~)) board shall coordinate all existing programs of financial aid except those specifically dedicated to a particular institution by the donor.

(3) The ((~~commission~~)) board shall take the initiative and responsibility for coordinating all federal student financial aid programs to insure that the state recognizes the maximum potential effect of these programs, and shall design the state program which complements existing federal, state and institutional programs. In its program design, the board shall ensure that the state program continues to follow the principle that state financial aid funding follows the student to the student's choice of institution of higher education.

(4) Counseling is a paramount function of the state need grant and other state student financial aid programs, and in most cases could only be properly implemented at the institutional levels; therefore, state student financial aid programs shall be concerned with the attainment of those goals which, in the judgment of the ((~~commission~~)) board, are the reasons for the existence of a student financial aid program, and not solely with administration of the program on an individual basis.

(5) The board shall develop, distribute, and deliver information about financial aid opportunities and requirements to persons and organizations that include, but need not be limited to: Students, parents, common schools, institutions of higher education, public libraries, community-based organizations, and other organizations and facilities that serve parents, students, and potential students. The distribution of information may occur through a variety of means including a toll-free hotline and the internet. A special outreach effort shall be targeted toward parents of students in the sixth through ninth grades. This outreach program shall include information about the performance requirements necessary for college entrance as well as the financial need requirements of state financial aid programs. The board shall work cooperatively with the superintendent of public instruction, the state board of education, the common schools, institutions of higher education, and other interested parties to design, distribute, and deliver financial aid information for the special outreach effort.

(6) The "package" approach of combining loans, grants and employment for student financial aid shall be the conceptional element of the state's involvement.

Sec. 6. RCW 28B.10.806 and 1989 c 254 s 3 are each amended to read as follows:

The ((~~commission~~)) board shall have the following powers and duties:

(1) Conduct a full analysis of student financial aid as a means of:

(a) Fulfilling educational aspirations of students of the state of Washington, and

(b) Improving the general, social, cultural, and economic character of the state.

Such an analysis will be a continuous one and will yield current information relevant to needed improvements in the state program of student financial aid. The ((~~commission~~)) board will disseminate the information yielded by their analyses to all appropriate individuals and agents.

(i) all programs and sources of available student financial aid,

(ii) distribution of Washington citizens by socio-economic class,

(iii) data from federal and state studies useful in identifying:

(A) demands of students for specific educational goals in colleges, and

(B) the discrepancy between high school students' preferences and the colleges they actually selected.

(2) Design a state program of student financial aid based on the data of the study referred to in this section. The state program will supplement available federal and local aid programs. The state program of student financial aid will not exceed the difference between the budgetary costs of attending an institution of higher learning and the student's total resources, including but not limited to: Family support, personal savings, employment, and unemployment compensation; temporary assistance for needy families; and federal, state, and local financial aid and living assistance programs.

(3) Determine and establish criteria for financial need of the individual applicant based upon the consideration of that particular applicant. In making this determination the ((~~commission~~)) board shall consider the following:

(a) Assets and income of the student.

(b) Assets and income of the parents, or the individuals legally responsible for the care and maintenance of the student.

(d) Any other criteria deemed relevant to the ((~~commission~~)) board.

(4) Set the amount of financial aid to be awarded to any individual needy or disadvantaged student in any school year.

(5) Award financial aid to needy or disadvantaged students for a school year based upon only that amount necessary to fill the financial gap between the budgetary cost of attending an institution of higher education ((~~and~~)), the family and student contribution, and other student financial aid.

(6) Review the need and eligibility of all applications on an annual basis and adjust financial aid to reflect changes in the financial need of the recipients and the cost of attending the institution of higher education.

Sec. 7. RCW 28B.10.808 and 1991 c 164 s 4 are each amended to read as follows:

In awarding need grants, the ((~~commission~~)) board shall proceed substantially as follows: PROVIDED, That nothing contained herein shall be construed to prevent the ((~~commission~~)) board, in the exercise of its sound discretion, from following another procedure when the best interest of the program so dictates:

(1) The ((~~commission~~)) board shall annually select the financial aid award ((~~winners~~)) recipients from among Washington residents applying for student financial aid who have been ranked according to financial need as determined by the amount of the family contribution and other considerations brought to the ((~~commission's~~)) board's attention.

(2) The financial need of the highest ranked students shall be met by grants depending upon the evaluation of financial need until the total allocation has been disbursed. Funds from grants which are declined, forfeited or otherwise unused shall be reawarded until dispersed.

(3) A grant may be renewed ((~~until the course of study is completed, but not for~~)) up to the published length of time of the program, with total eligibility limited to no more than an additional ((~~four~~)) three academic years plus one quarter or semester beyond the first year of the award. These shall not be required to be consecutive years. The board may make an exception for a student enrolled in a five-year program, extending eligibility by an additional two quarters or one semester. The board shall adopt rules to ensure that, except in very exceptional circumstances, the period of eligibility for a student enrolled below the upper division level does not extend beyond two academic years plus one quarter or semester. All periods of eligibility for full-time and part-time students shall be adjusted to the equivalent credit or clock hours. Qualifications for renewal will include maintaining satisfactory ((~~academic standing~~)) progress toward completion of the course of study, and continued eligibility as determined by the ((~~commission~~)) board. Should the recipient terminate his or her enrollment for any reason during the academic year, the unused portion of the grant shall be returned to the state educational grant fund by the institution according to the institution's own policy for issuing refunds, except as provided in RCW 28B.10.8081.

(4) In computing financial need, the ((~~commission~~)) board shall determine a maximum student expense budget allowance, not to exceed an amount equal to the total maximum student expense budget at the public institutions plus the current average state appropriation per student for operating expense in the public institutions.

Sec. 8. RCW 28B.10.810 and 1989 c 254 s 5 are each amended to read as follows:

For a student to be eligible for ((~~financial aid the~~)) a state need grant a student must:

(1) Be a "needy student" or "disadvantaged student" as determined by the ((~~commission~~)) board in accordance with RCW 28B.10.802 (3) and (4).

(2) Have been domiciled within the state of Washington for at least one year.

(3) Be enrolled or accepted for enrollment on at least a half-time basis at an institution of higher education in Washington as defined in RCW 28B.10.802(1).

(4) Have complied with all the rules and regulations adopted by the ((~~commission~~)) board for the administration of RCW 28B.10.800 through 28B.10.824.

Sec. 9. RCW 28B.10.822 and 1973 c 62 s 4 are each amended to read as follows:

The ((~~commission~~)) board shall adopt rules ((~~and regulations~~)) as may be necessary or appropriate for effecting the provisions of RCW 28B.10.800 through 28B.10.824 and section 1 of this act, and not in conflict with RCW 28B.10.800 through 28B.10.824, in accordance with the provisions of chapter 34.05 RCW, the ((~~state higher education~~)) administrative procedure act.

Sec. 10. RCW 28B.101.010 and 1990 c 288 s 3 are each amended to read as follows:

The educational opportunity grant program is hereby created ((~~as a demonstration project~~)). The program has two major purposes. The first major purpose is to serve placebound financially needy students by assisting them to obtain a baccalaureate degree at public and ((~~private~~)) independent institutions of higher education which have the capacity to accommodate such students within existing educational programs and facilities. The second major purpose is to minimize the need to build new public colleges and universities or to expand the physical capacity of existing state colleges and universities by providing an incentive for upper division students to attend some public and independent institutions of higher education with unused capacity or a recent history of underenrollment. An additional purpose is to assist needy placebound students to complete their upper division coursework at a branch campus, extension center, or the main campus of an institution of higher education that does not have unused capacity or a recent history of underenrollments.

Sec. 11. RCW 28B.101.020 and 1990 c 288 s 4 are each amended to read as follows:

(1) For the purposes of this chapter, "placebound" means unable to relocate to complete a college program because of family or employment commitments, health concerns, monetary inability, or other similar factors. Placebound also includes students who might be able to relocate to a baccalaureate institution with unused capacity if additional student aid was available.

(2) To be eligible for an educational opportunity grant, applicants must be placebound residents of the state of Washington who are needy students as defined in RCW 28B.10.802(3) ((~~and~~)), who have completed the associate of arts degree or its equivalent, and who wish to complete a baccalaureate degree. A placebound resident is one who may be influenced by the receipt of an enhanced student financial aid award to attend an institution that has existing unused capacity ((rather than attend a branch campus established pursuant to chapter 28B.45 RCW. An eligible placebound applicant is further defined as a person whose residence is located in an area served by a branch campus who, because of family or employment commitments, health concerns, monetary need, or other similar factors, would be unable to complete an upper-division course of study but for receipt of an educational opportunity grant)) or a recent history of underenrollment.

Sec. 12. RCW 28B.101.030 and 1990 c 288 s 5 are each amended to read as follows:

The higher education coordinating board shall develop and administer the educational opportunity grant program. The board shall adopt necessary rules and guidelines and develop criteria and procedures to select eligible participants in the program. The rules shall give first priority to needy placebound students who wish to attend the main campus of a public or independent baccalaureate institution with unused capacity or a recent history of underenrollment; and second priority to needy placebound students who wish to attend the branch campus or extension center of a baccalaureate institution or who wish to attend the main campus of a public or independent institution of higher education that does not have unused capacity or a recent history of underenrollment. The rules shall prohibit a student from receiving a grant for more than two academic years plus one quarter or semester, or their credit hour equivalent. With the assistance of the office of financial management, and in consultation with public and independent baccalaureate institutions, the board shall develop criteria for determining the extent of underenrollments. Payment shall be made directly to the eligible participant periodically upon verification of enrollment and satisfactory progress towards degree completion.

Sec. 13. RCW 28B.101.040 and 1993 sp.s. c 18 s 35 and 1993 c 385 s 2 are each reenacted and amended to read as follows:

Grants may be used by eligible participants to attend any public or ((~~private~~)) independent college or university in the state of Washington that is accredited by an accrediting association recognized by rule of the higher education coordinating board ((~~and that has an existing unused capacity. Grants shall not be used to attend any branch campus or educational program established under chapter 28B.45 RCW~~)). The participant shall not be eligible for a grant if it will be used for any programs that include religious worship, exercise, or instruction or to pursue a degree in theology. Each participating student may receive up to two thousand five hundred dollars per academic year, not to exceed the student's demonstrated financial need for the course of study. Resident students as defined in RCW 28B.15.012(2)(e) are not eligible for grants under this chapter. The board may deposit sufficient funds from any appropriation for this program into the state educational trust fund under RCW 28B.10.821 in order to provide a one-year renewal of the grant for each new recipient of the program.

NEW SECTION. Sec. 14. (1) The sum of five million dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 1998, from the general fund to the higher education coordinating board for work study grants under chapter 28B.12 RCW.

(2) The sum of five million dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 1999, from the general fund to the higher education coordinating board for work study grants under chapter 28B.12 RCW.

NEW SECTION. Sec. 15. (1) The sum of five million dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 1998, from the general fund to the higher education coordinating board for educational opportunity grants under chapter 28B.101 RCW.

NEW SECTION. Sec. 16. (1) The sum of eleven million five hundred thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 1998, from the general fund to the higher education coordinating board for the state need grant program.

(2) The sum of eleven million five hundred thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 1999, from the general fund to the higher education coordinating board for the state need grant program.

NEW SECTION. Sec. 17. Sections 3 through 8 of this act apply to students who receive assistance through the state need grant program in the 1998 fall academic term and thereafter.