Fund Splits. Central services (CS) are core services provided by a centralized agency to support other state agencies in conducting their operations. CS include administrative hearings, auditing, information technology, legal, statewide financial systems, and workers compensation. For public institutions of higher education (public institutions), funding for CS costs in the operating budget is split between General Fund-State (GF-S) and higher education non-appropriated tuition operating fee revenue.
Employee Compensation and Central Services Paid by State Funds. Starting in the 2029-31 biennium, funding levels for increases in employee compensation and CS for expenditures paid with appropriated state funds or tuition reverts to funding levels in the 2023-25 biennium. The state fund levels per entity from 2023-25:
A 10 percent increase is required each biennium proceeding the 2029-31 biennium until the increases for employee compensation and central services are fully funded by state funds.
State funds cannot backfill any dedicated fund sources which have insufficient revenue for the compensation increases.
Compensation is defined as the cost of salaries, wages, and pension contribution costs, subject to the Higher Education Retirement Plan, that are reported to the Office of Financial Management for purposes of the state budget and accounting systems with a funding source of an appropriated state fund or tuition.
Washington State Institute for Public Policy Study. Washington State Institute for Public Policy (WSIPP) must conduct a study, in consultation with public baccalaureates and the State Board for Community and Technical Colleges, to define and evaluate essential student services standards. WSIPP’s study must look at academic support, wellness and basic needs, instructional quality including class size and number of tenure track faculty, career and workforce readiness, and funding alignment. In conducting their study, WSIPP must reach out to certain entities and utilize certain research.
WSIPP must report its findings and recommendations to the Legislature by December 1, 2026.
PRO: WWU opened in 1893 and for the first 120 years the state paid for its employees. This was changed in 2015. The fund split, created in 2015, puts students on the hook for employee compensation expenses. The fund split was invented to cover central services as well as employee compensation. Tuition revenues have not matched the increases in COLAs. Last year, when COLAs were not fully funded, the Seattle Colleges district established a furlough schedule. Fully funded compensation is important to fulfill for our basic function.
When tuition falls short, or is capped, it hinders a school’s ability to pay for necessary costs. Tuition revenue should be used to increase quality, rather than cover deficits. The fund split has been an extreme hardship on our institutions and has not allowed WSU to provide quality COLAs to our faculty. WSU’s recent decision to close the pharmacy program in Yakima is tied to the fund split.
This bill proposes a gradual approach to restoring funding. This bill addresses an inconvenient fiction—that tuition will magically replace state funding. If the students were to pay for these costs with tuition, without institutional cuts, their tuition would go up by 30%. Library hours have been cut, and staff are sleeping on couches. We are the only state agencies where the COLAs aren’t fully funded. This says that the state just doesn’t care about higher education employees as much as other state employees.
The fund splits have led to a reliance on tuition revenue which is an unstable revenue source.
We are anticipating having to cut workforce programs and classes if there is no change in the way we are funded. The region we serve is severely economically depressed. Every degree and certificate accomplished in my community is an investment in the future of my community.
CTCs have been chronically underfunded. Tuition does not even begin to cover the gap. Our net tuition increase doesn’t even cover the cost of our Puget Sound Energy bill, not to mention the COLAs. Without a change, this will result in a cut to student services.
We serve rural and low-income students. Over 80% of the budget is wages and compensation. Every reduction in funding, or unfunded mandate, leads to cuts.
PRO: Senator T'wina Nobles, Prime Sponsor; Nora Selander, Western Washington University; Chris Mulick, Washington State University; Sam Ligon, Washington State Council of Faculty; EWU Faculty Legislative Rep.; Beth Ebel, University of Washington Faculty Legislative Rep; Matt Altman, Central Washington University Faculty Legislative Rep; Bidisha Biswas, Faculty Legislative Rep for WWU; Stephen Bollens, Washngton State University Faculty Senate; Chemene Crawford, Everett Community College; Bill Lyne, United Faculty of Washington State; Jacqui Cain, American Federation of Teachers (AFT-WA); Arlen Harris, State Board for Community & Technical Colleges; Dr. Suzy Ames, President, Peninsula College; Dr. Rebekah Woods, President, Columbia Basin College; Dr. Timonthy Stokes, President, South Puget Sound Community College; Dr. Joyce Loveday, President, Clover Park Technical College; Amy Parris, Board Chair, Big Bend Community College; Dr. Amy Morrison, President, Lake Washington Institute of Technology; Dr. Chantae Recasner, President, Seattle Central College.