Joint 2016 Legislative Agenda Takes Shape

The higher education community will once again be speaking with one voice during the 2016 legislative session.  The Council of Presidents, in conjunction with our colleagues at the State Board for Community and Technical Colleges, the Independent Colleges of Washington, and the Student Achievement Council, recently unveiled a common agenda focused on the following four common priorities:

  • Ensure the Full Success of the 2015-2017 Biennium Investments
  • Serve the Low Income Students who Remain Unserved by Student Financial Aid
  • Advance Student Success and Achievement Investments
  • Streamline State Level Reporting Requirements and Support Regulatory Relief

More information on our 2016 joint agenda can be found here.

This marks the second straight year that the higher education community has come together around a common agenda.  Details on the joint 2015 agenda can be found here.

 

 

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Governor Releases Supplemental Budget

Last week, Governor Inslee released his 2016 supplemental budget proposal.

The Governor’s proposed supplemental budget makes modest adjustments to the biennial budget.  The investments in the supplemental budget provide funding to meet current service levels, caseload and enrollment increases, emergencies, and costs not anticipated in the final biennial budget.

In addition, there are a handful of new investments to support high-priority areas including the state’s psychiatric hospitals and child protective services.

Finally the Governor’s budget makes several reductions to agency budgets for central services and implementation of LEAN savings.

Higher Education

The Governor’s proposed supplemental budget retains the tuition reduction for undergraduate, resident students for the biennium. No additional dollars are provided to meet gaps in the tuition backfill for the University of Washington and Eastern Washington University.  The budget does extend the date for the technical tuition work group’s work to January 8, 2016 from December 1, 2015.

The budget makes three investments in higher education.  The budget provides $450,000 for the Mathematics, Engineering, Science Achievement program with Washington’s community and technical colleges and $250,000 to support the MESA pre-college program at the University of Washington. The budget also provides $155,000 to support the Governor’s STEM Education Innovation Alliance.

Finally the budget maintains current funding for the State Need Grant and slightly reduces funds to the College Bound Scholarship program to reflect a slight drop in the number of students forecasted to use their scholarship.

Federal Spending Bill: Impact to Higher Education

Late this week Congress reached agreement on a $1.1 trillion spending bill for federal fiscal year 2016.

The spending bill provides the details for the distribution of funds as a result of agreed upon increases in budget caps in November, including an increase in funds for education programs.  The bill will fund the federal government through September 2016.

The bill increases funding for TRIO programs ($60 million) and GEAR UP ($21 million) and maintains funding for most student aid programs in FY16.  The bill also increases spending for the National Institutes of Health ($2 billion) and the National Science Foundation ($112 million).

While funding changes are modest, the bill eliminates several reductions to education that were proposed earlier this year.

  • The Pell Grant discretionary fund will remain level and will not be reduced by $370 million as proposed earlier. In addition the maximum Pell Grant will increase to $5,915, an increase of $140.
  • The Federal Work Study and the Federal SEOG program will maintain funding and will not be reduced.

The bill also does not include any provisions to block the Administrations higher education regulations, including gainful employment.

The joint explanatory statement, a legally binding document that expands on the bill’s provisions, addresses customer service for borrowers in loan servicing.  The statement requires that a federal servicing policies and procedures manual be published and requires the U.S. Department of Education to allocate new loans based solely on the quality of a loan servicers’ work and ability to keep borrowers current.

Finally in addition to the spending bill, Congress reached agreement on a tax package which would permanently extend the American Opportunity Tax Credit and extend for one-year an above-the-line deduction for tuition and related expenses.

 

Deal Extends Perkins Loan Program

Senate lawmakers have reached a tentative deal to extend the federal Perkins Loan Program through September 30, 2017 in an attempt to continue the program until Congress can pass a full reauthorization of the Higher Education Act.

The Federal Perkins Loan Program Extension Act of 2015 comes nearly three months after the September 30 expiration of the program.

The bill would:

  • Eliminate Perkins loan eligibility for new graduate students beginning in the 2016-17 year. However, current graduate students enrolled in the program would be grandfathered in for one additional fiscal year;
  • Require schools to award all subsidized and unsubsidized Direct loans prior to awarding Perkins for new undergraduate Perkins borrowers;
  • Prevent the U.S. Department of Education from enacting future grandfathering provisions for the program; and
  • Extend the program for two additional years through September 30, 2017. However, all Perkins loan authority would end effective September 30, 2017, thereby discontinuing any grandfathering beyond that date.

The bill also contains new disclosure requirements, including one that would mandate schools notify Perkins borrowers that the program is coming to an end.

This extension has the support of Senator Lamar Alexander (R-TN), chairman of the Senate Health Education, Labor, and Pensions Committee, who has continually blocked any Senate passage of a Perkins extension. If the Senate passes this latest bill, it would likely be passed by the House and sent to the President’s desk for signing.

The Perkins Loan Program was created in 1958 as the National Defense Student Loan Program. It was renamed in 1986 to honor the late U.S. Congressman Carl D. Perkins.

 

Bill Would Stop Feds From Reducing Social Security to Pay Off Student Loans

Late last week, U.S. Senators Wyden (D-OR) and Brown (D-OH) introduced legislation to protect individuals who receive social security benefits from having the benefits reduced to pay outstanding federal debts, such as student loans.

The Protection of Social Security Benefits Restoration Act  would repeal the law that allows earned benefits to be garnished by the federal government to collect federal debts, such a student loans, home loans owed to the Veterans Administration and food stamp overpayments.

Washington Moves Towards Implementation of 529 College Savings Plan

The five-member Guaranteed Education Tuition (GET) Committee recently put forth a proposal to establish a state 529 college savings plan with the hopes of opening in 2017.  The plan would be led by the state, requiring the state to allocate funds to pay the start-up costs for the new savings plan.  The Washington State Investment Board would take charge of the investment portfolio. Finally the program would use existing software and processes so as to minimize costs.

The proposed program would not replace the current GET program but would offer a new approach as conversations continue about what to do next with GET.

Currently six other states offer independent 529 college savings plans.

More Adults are Completing Degrees

In the United States today, nearly 30% more adults aged 25 and older have a baccalaureate degree than did five years ago.

The U.S. Census Bureau looked at two five-year periods from 2005 to 2009 and 2010 to 2014.  Of the approximate 3,100 counties in the United States, 1,000 saw increases in the percentage of adults with a bachelor’s degree or higher. Only 60 counties had decreases.