BILL REQ. #:  S-2101.4 



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SENATE BILL 5883
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State of Washington63rd Legislature2013 Regular Session

By Senators Baumgartner, Bailey, Ericksen, Braun, Benton, Tom, Holmquist Newbry, Schoesler, Brown, Hill, Roach, and Hewitt

Read first time 03/20/13.   Referred to Committee on Ways & Means.



     AN ACT Relating to higher education funding; amending RCW 28B.10.776 and 28B.77.090; reenacting and amending RCW 28B.15.067 and 28B.15.068; creating a new section; and repealing RCW 28B.10.778, 28B.10.780, 28B.10.782, 28B.10.784, and 28B.15.101.

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

NEW SECTION.  Sec. 1   The legislature finds that public institutions of higher education have experienced dramatic reductions in state support over the last four fiscal years, which have necessitated large increases in tuition prices. The legislature further finds that the combination of decreases in state funding and increases in tuition have led to a scenario where public higher education is being funded disproportionately by the students and their families. Therefore, it is the intent of the legislature to more equitably distribute the support of public higher education between the state and students and their families by (1) establishing a funding methodology that is based on enrollment levels with which to provide predictable and stable baseline state funding to the institutions of higher education; and (2) establishing a process whereby any state funds over and above the level needed for the baseline levels of state funding are distributed among the institutions of higher education based on their performance in meeting statewide goals and expectations, and to reward the highest performers.
     It is the goal of the legislature that institutions of higher education receive a baseline level of state funding that is sufficient to allow ongoing access to postsecondary education for Washington residents, particularly in high-demand degree programs, and to achieve a more equitable share of support between the state and students and their families. As a result, no later than April 26, 2015, the legislature intends to revisit the level of state funding established in section 2, chapter . . ., Laws of 2013 (section 2 of this act) and determine whether any step adjustments are necessary.

Sec. 2   RCW 28B.10.776 and 1993 sp.s. c 15 s 2 are each amended to read as follows:
     ((It is the policy of the state of Washington that the essential requirements level budget calculation for)) (1) Beginning with fiscal year 2014, institutions of higher education ((include enrollment levels necessary to maintain, by educational sector, the participation rate funded in the 1993 fiscal year. The participation rate shall be based on the state's estimated population ages seventeen and above by appropriate age groups)) shall receive a level of state funding that is equal to the maintenance level appropriations in the omnibus appropriations act for the 2013-2015 biennium expressed as a per-resident student rate that is based on a three-year average of the number of actual full-time equivalent enrolled resident students for the current academic year and the two previous academic years as reported in the state-funded public higher education enrollment reports produced by the office of financial management.
     (2) The per-resident student rates specified in subsection (1) of this section shall increase each fiscal year by the rate of inflation as measured by the implicit price deflator.
     (3) The per-resident student rates specified in subsection (1) of this section in existence at the time when specific appropriations are made for creation or expansion of new or existing programs of study shall receive a step adjustment in the following fiscal year to reflect this additional level of funding.
     (4) Institutions of higher education are legally entitled to receive the levels of state funding specified in subsections (1) through (3) of this section.
     (5) Beginning with fiscal year 2014, any state funds appropriated for institutions of higher education that remain after satisfying the per-resident student rates specified in subsections (1) through (3) of this section, or any increases in state appropriations for the institutions of higher education, must be distributed as provided in this subsection (5).
     (a) A proportionate share must be distributed to the state board for community and technical colleges for disbursement to the community and technical colleges based on performance in accordance with the student achievement initiative.
     (b) A proportionate share must be distributed to the public four-year institution sector of higher education. This share must be disbursed to the state universities, the regional universities, and The Evergreen State College that have met the requirements in RCW 28B.77.090(2), and disbursement must be as specified in the omnibus appropriations act based on a three-year average of performance, or in recognition of the highest performing four-year institution of higher education, in the following metrics:
     (i) Average time to degree for undergraduate students;
     (ii) Number of undergraduate high-demand degrees produced;
     (iii) Freshman retention;
     (iv) Low-income population; and
     (v) Space utilization.
     (6) For the purposes of subsection (5) of this section, "proportionate share" means the proportion of near general fund appropriations to either (a) the state board for community and technical colleges or (b) the state universities, the regional universities, and The Evergreen State College, relative to the total near general fund appropriations to the institutions of higher education.
     (7) For the purposes of this section, the inflation adjustment shall be computed using the percentage change on the implicit price deflator for personal consumption expenditures for the United States for the previous calendar year, as compiled by the bureau of economic analysis of the United States department of commerce and reported in the most recent quarterly publication of the economic and revenue forecast council or successor agency
.

Sec. 3   RCW 28B.15.067 and 2012 2nd sp.s. c 7 s 914 and 2012 c 228 s 6 are each reenacted and amended to read as follows:
     (1) Tuition fees shall be established under the provisions of this chapter.
     (2) Except as provided in subsection (4)(a)(ii) of this section:
     (a) For the 2013-14 and 2014-15 academic years, reductions or increases in full-time tuition fees shall be as provided in the omnibus appropriations act for resident undergraduate students at community and technical colleges and shall be three percent below the full-time resident undergraduate tuition fees for the 2012-13 academic year.
     (b)
Beginning in the ((2011-12)) 2015-16 academic year, reductions or increases in full-time tuition fees shall be as provided in the omnibus appropriations act for resident undergraduate students at community and technical colleges and shall not exceed inflation as measured by the implicit price deflator for personal consumption expenditures for the United States for the previous calendar year, as compiled by the bureau of economic analysis of the United States department of commerce and reported in the most recent quarterly publication of the economic and revenue forecast council or successor agency.
     (3) The governing boards of the state universities, regional universities, and 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 nonresident students, summer school students, and students in other self-supporting degree programs. Percentage increases in full-time tuition may exceed the fiscal growth factor. Except during the 2011-2013 fiscal biennium, the state board for community and technical colleges may pilot or institute differential tuition models. The board may define scale, scope, and rationale for the models.
     (((3))) (4)(a)(i) Beginning with the 2011-12 academic year and through the end of the ((2014-15)) 2018-19 academic year, the governing boards of the state universities, the regional universities, and The Evergreen State College may reduce or increase full-time tuition fees for all students, 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; however ((, during the 2011-2013 fiscal biennium, reductions or)):
     (A) For the 2013-14 and 2014-15 academic years, full-time tuition fees for resident undergraduate students shall be three percent below the full-time resident undergraduate tuition fees for the 2012-13 academic year, except as provided in (a)(ii) of this subsection; and
     (B) I
ncreases in tuition ((must be uniform among)) for resident undergraduate students beginning in academic year 2015-16, must not exceed inflation as measured by the implicit price deflator for personal consumption expenditures for the United States for the previous calendar year, as compiled by the bureau of economic analysis of the United States department of commerce and reported in the most recent quarterly publication of the economic and revenue forecast council or successor agency, except as provided in (a)(ii) of this subsection.
     (ii) If, in any fiscal year, state funding for a college or university falls below the funding rates for full-time equivalent resident students specified in RCW 28B.10.776, the governing board may increase full-time tuition fees for resident undergraduate students for the ensuing academic year by an amount not to exceed the amount necessary to achieve the funding levels specified in RCW 28B.10.776
.
     (b) Prior to reducing or increasing tuition for each academic year, the governing boards of the state universities, the regional universities, and The Evergreen State College shall consult with existing student associations or organizations with student undergraduate and graduate representatives regarding the impacts of potential tuition increases. Each governing board shall make public its proposal for tuition and fee increases twenty-one days before the governing board of the institution considers adoption and allow opportunity for public comment. However, the requirement to make public a proposal for tuition and fee increases twenty-one days before the governing board considers adoption shall not apply if the omnibus appropriations act has not passed the legislature by May 15th. Governing boards shall be required to provide data regarding the percentage of students receiving financial aid, the sources of aid, and the percentage of total costs of attendance paid for by aid.
     (c) Prior to reducing or increasing tuition for each academic year, the state board for community and technical college system shall consult with existing student associations or organizations with undergraduate student representation regarding the impacts of potential tuition increases. The state board for community and technical colleges shall provide data regarding the percentage of students receiving financial aid, the sources of aid, and the percentage of total costs of attendance paid for by aid.
     (((4) Beginning with the 2015-16 academic year through the 2018-19 academic year, the governing boards of the state universities, regional universities, and The Evergreen State College may set tuition for resident undergraduates as follows:
     (a) If state funding for a college or university falls below the state funding provided in the operating budget for fiscal year 2011, the governing board may increase tuition up to the limits set in (d) of this subsection, reduce enrollments, or both;
     (b) If state funding for a college or university is at least at the level of state funding provided in the operating budget for fiscal year 2011, the governing board may increase tuition up to the limits set in (d) of this subsection and shall continue to at least maintain the actual enrollment levels for fiscal year 2011 or increase enrollments as required in the omnibus appropriations act;
     (c) If state funding is increased so that combined with resident undergraduate tuition the sixtieth percentile of the total per-student funding at similar public institutions of higher education in the global challenge states under RCW 28B.15.068 is exceeded, the governing board shall decrease tuition by the amount needed for the total per-student funding to be at the sixtieth percentile under RCW 28B.15.068; and
     (d) The amount of tuition set by the governing board for an institution under this subsection (4) may not exceed the sixtieth percentile of the resident undergraduate tuition of similar public institutions of higher education in the global challenge states.
))
     (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) The tuition fees established under this chapter shall not apply to eligible students enrolling in a dropout reengagement program through an interlocal agreement between a school district and a community or technical college under RCW 28A.175.100 through 28A.175.110.
     (7) The tuition fees established under this chapter shall not apply to eligible students enrolling in a community or technical college participating in the pilot program under RCW 28B.50.534 for the purpose of obtaining a high school diploma.
     (8) Beginning in the 2019-20 academic year, reductions or increases in full-time tuition fees for resident undergraduates at four-year institutions of higher education shall be as provided in the omnibus appropriations act.
     (((9) The legislative advisory committee to the committee on advanced tuition payment established in RCW 28B.95.170 shall:
     (a) Review the impact of differential tuition rates on the funded status and future unit price of the Washington advanced college tuition payment program; and
     (b) No later than January 14, 2013, make a recommendation to the appropriate policy and fiscal committees of the legislature regarding how differential tuition should be addressed in order to maintain the ongoing solvency of the Washington advanced college tuition payment program.
))

Sec. 4   RCW 28B.15.068 and 2012 c 229 s 525 and 2012 c 229 s 524 are each reenacted and amended to read as follows:
     (1) In order to facilitate the full implementation of ((chapter 10, Laws of 2011 1st sp. sess. for the 2011-12 through 2018-19 academic years)) RCW 28B.10.776 and 28B.15.067, the institutions of higher education are authorized to adopt tuition levels that are less than, equal to, or greater than the tuition levels assumed in the omnibus appropriations act, subject to the conditions and limitations in this chapter, chapter 28B.10 RCW, and the omnibus appropriations act.
     (2) By September 1st of each year beginning in 2011, the office of financial management shall report to the governor, the student achievement council, and appropriate committees of the legislature with updated estimates of:
     (a) The total per-student funding level that represents the sixtieth percentile of funding for similar institutions of higher education in the global challenge states; and
     (b) The tuition that represents the sixtieth percentile of resident undergraduate tuition for similar institutions of higher education in the global challenge states.
     (3) As used in this section, "global challenge states" are the top performing states on the new economy index published by the progressive policy institute as of July 22, 2007. The new economy index ranks states on indicators of their potential to compete in the new economy. At least once every five years, the office of financial management shall determine if changes to the list of global challenge states are appropriate. The office of financial management shall report its findings to the governor and the legislature.
     (4) Institutions of higher education, in collaboration with relevant student associations, shall aim to have all students who can benefit from available tax credits that mitigate the costs of higher education take advantage of these opportunities. These tax credits include the American opportunity tax credit provided in the American recovery and reinvestment act of 2009, the lifetime learning credit, and other relevant tax credits for as long as they are available.
     (5)(a) Institutions shall make every effort to communicate to students and their families the benefits of such tax credits and provide assistance to students and their families on how to apply.
     (b) Information about relevant tax credits shall, to the greatest extent possible, be incorporated into financial aid counseling, admission information, and individual billing statements.
     (c) Institutions shall, to the greatest extent possible, use all means of communication, including but not limited to web sites, online catalogues, admission and registration forms, mass email messaging, social media, and outside marketing to ensure information about relevant tax credits is visible and compelling, and reaches the maximum amount of student and families that can benefit.
     (6) In the event that the economic value of the American opportunity tax credit is reduced or expires at any time before December 31, 2012, institutions of higher education shall:
     (a) Develop an updated tuition mitigation plan established under RCW 28B.15.102 for the purpose of minimizing, to the greatest extent possible, the increase in net cost of tuition or total cost of attendance for students resulting from any such change. This plan shall include the methods specified by the four-year institution of higher education to avoid adding additional loan debt burdens to students regardless of the source of such loans;
     (b) Report to the governor and the relevant committees of the legislature on their plans to adjust their tuition mitigation plans no later than ninety days after any such change to the American opportunity tax credit.

Sec. 5   RCW 28B.77.090 and 2012 c 229 s 115 are each amended to read as follows:
     (1) An accountability monitoring and reporting system is established as part of a continuing effort to make meaningful and substantial progress towards the achievement of long-term performance goals in higher education.
     (2) To provide consistent, easily understood data among the public four-year institutions of higher education within Washington and in other states, the following data must be reported to the education data center annually by December 1st, and at a minimum include data recommended by a national organization representing state chief executives. The education data center in consultation with the council may change the data requirements to be consistent with best practices across the country. This data must, to the maximum extent possible, be disaggregated by race and ethnicity, gender, state and county of origin, age, and socioeconomic status, and include the following for the four-year institutions of higher education:
     (a) Bachelor's degrees awarded;
     (b) Graduate and professional degrees awarded;
     (c) Graduation rates: The number and percentage of students who graduate within four years for bachelor's degrees and within the extended time, which is six years for bachelor's degrees;
     (d) Transfer rates: The annual number and percentage of students who transfer from a two-year to a four-year institution of higher education;
     (e) Time and credits to degree: The average length of time in years and average number of credits that graduating students took to earn a bachelor's degree;
     (f) Enrollment in remedial education: The number and percentage of entering first-time undergraduate students who place into and enroll in remedial mathematics, English, or both;
     (g) Success beyond remedial education: The number and percentage of entering first-time undergraduate students who complete entry college-level math and English courses within the first two consecutive academic years;
     (h) Credit accumulation: The number and percentage of first-time undergraduate students completing two quarters or one semester worth of credit during their first academic year;
     (i) Retention rates: The number and percentage of entering undergraduate students who enroll consecutively from fall-to-spring and fall-to-fall at an institution of higher education;
     (j) Course completion: The percentage of credit hours completed out of those attempted during an academic year;
     (k) Program participation and degree completion rates in bachelor and advanced degree programs in the sciences, which includes agriculture and natural resources, biology and biomedical sciences, computer and information sciences, engineering and engineering technologies, health professions and clinical sciences, mathematics and statistics, and physical sciences and science technologies, including participation and degree completion rates for students from traditionally underrepresented populations;
     (l) Annual enrollment: Annual unduplicated number of students enrolled over a twelve-month period at institutions of higher education including by student level;
     (m) Annual first-time enrollment: Total first-time students enrolled in a four-year institution of higher education;
     (n) Completion ratio: Annual ratio of undergraduate and graduate degrees and certificates, of at least one year in expected length, awarded per one hundred full-time equivalent undergraduate students at the state level;
     (o) Market penetration: Annual ratio of undergraduate and graduate degrees and certificates, of at least one year in program length, awarded relative to the state's population age eighteen to twenty-four years old with a high school diploma;
     (p) Student debt load: Median three-year distribution of debt load, excluding private loans or debts incurred before coming to the institution;
     (q) Space utilization: For each academic year, the average number of hours per week each classroom seat and classroom lab is utilized;
     (r)
Data related to enrollment, completion rates, participation rates, and debt load shall be disaggregated for students in the following income brackets to the maximum extent possible:
     (i) Up to seventy percent of the median family income;
     (ii) Between seventy-one percent and one hundred twenty-five percent of the median family income; and
     (iii) Above one hundred twenty-five percent of the median family income; and
     (((r))) (s) Yearly percentage increases in the average cost of undergraduate instruction.
     (3) Four-year institutions of higher education must count all students when collecting data, not only first-time, full-time freshmen.
     (4) In conjunction with the office of financial management, all four-year institutions of higher education must display the data described in subsection (2) of this section in a uniform dashboard format on the office of financial management's web site no later than December 1, 2011, and updated thereafter annually by December 1st. To the maximum extent possible, the information must be viewable by race and ethnicity, gender, state and county of origin, age, and socioeconomic status. The information may be tailored to meet the needs of various target audiences such as students, researchers, and the general public.
     (5) The council shall use performance data from the education data center for the purposes of strategic planning, to report on progress toward achieving statewide goals, and to develop priorities proposed in the ten-year plan for higher education.

NEW SECTION.  Sec. 6   The following acts or parts of acts are each repealed:
     (1) RCW 28B.10.778 (Budget calculation -- New enrollments -- Funding level -- Inflation factor) and 1993 sp.s. c 15 s 3;
     (2) RCW 28B.10.780 (Budget calculation -- Funding level) and 1993 sp.s. c 15 s 4;
     (3) RCW 28B.10.782 (Budget calculation -- Increased enrollment target level -- Availability of information) and 1993 sp.s. c 15 s 5;
     (4) RCW 28B.10.784 (Budget calculation -- Participation rate and enrollment level estimates -- Recommendations to governor and legislature) and 2012 c 229 s 517 & 1993 sp.s. c 15 s 6; and
     (5) RCW 28B.15.101 (Authority to modify tuition rates -- Performance-based measures and goals -- Institutional performance plans) and 2011 1st sp.s. c 10 s 5.

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