On Tuesday, leadership in the Senate Ways & Means Committee released their initial 2017-19 operating budget proposal. This proposal is the first from a legislative body following the release of Governor Inslee’s operating and capital budget proposals from December. See OPB’s brief here for a full comparison. Unlike the Governor’s budget proposal, the Senate does not propose significant new revenue, and therefore would provide far fewer new investments in new and existing programs.
Some noteworthy items in the Senate budget proposal include:
- Tuition Policy: Maintains current tuition policy allowing a 2.2 percent increase in resident undergraduate tuition in FY18 and a 2.0 percent increase in FY19. The Governor proposed freezing tuition for two years, and provided funds to backfill that freeze.
- Undergraduate Enrollment: Adds $10.5 million to the UW over the biennium to increase resident undergraduate enrollments in STEM and other fields.
- Financial Aid: Reduces the UW’s state appropriation by $5.2 million over the biennium and assume that the University would offset the reduction by reducing tuition waivers provided to students.
- Compensation: Partially funds $500 wage increases per year for faculty, staff, and represented employees. The budget would also reject tentative collective bargaining agreements between the UW and represented employees.
- New “Central Service”: Reinstates a charge for central services provided by the Governor’s Office of Financial Management, which would divert $7.5 million in tuition revenue over the biennium.
The Senate did not release a capital budget as of the time of this posting, but the brief will be updated once that information is available. We expect to review proposals from the House Appropriations Committee early next week, and will post additional information at that time.
Stay tuned to the OPBlog for updates on proposed budgets.
On Wednesday, Governor Inslee released his proposed 2017-19 biennial operating and capital budgets. For a detailed analysis and summary of the Governor’s proposals, please review the OPB brief.
The Governor’s ambitious spending plan relies on new revenue streams, including closing tax exemptions and establishing a new capital gains tax, to make significant investments in K-12 education, mental health, and homelessness. Funding for the UW would include salary increases for faculty and staff and additional enrollment capacity in the UW’s WWAMI medical education program.
The Governor would freeze resident undergraduate tuition across all public higher education institutions for two years, and would provide funding to cover the difference between the tuition freeze and incremental revenue expected under current policy. Finally, his plan would allocate $116 million to expand the State Need Grant Program to reduce the number of students who are currently eligible but unserved due to insufficient funding.
As a reminder, this budget release marks the first step of a lengthy budget process. Lawmakers in the Senate and the House will have the opportunity to release their own budget proposals over the course of the 2017 legislative session – set to begin on Monday, January 9, 2017.
Stay tuned to the OPBlog for updates during the 2017 legislative session.
The estimated annual cost of attendance for first-year UW undergraduates is now available for the 2016-17 academic year. Cost of attendance shows estimated expenses by campus for:
- Student fees
- Room & board
- Books, personal, & transportation
Cost of attendance (COA) is defined by the Higher Education Act. It is a statutory term that typically refers to the estimated cost for a full-time student to attend an institution of higher education for a standard nine-month academic year.
After accounting for grant and scholarship aid, UW students (particularly resident undergraduates) often pay far less than the estimated COA. In 2014-15 (the most recent year for which net price data is available), the published price for resident undergraduates at Seattle was $27,112, whereas the net price for first-time, resident undergraduates at Seattle was $9,744.
We will annually update the COA information on our website.
The Lincoln Project, the American Academy of Arts and Sciences’ study of public research universities (PRUs), has recently come out with its fifth and final report, which examines the challenges facing PRUs and recommends strategies for addressing them. The recommendations are threefold:
- Address Financial Challenges:
The sharp reduction in state funding for PRUs—down 30 percent since the year 2000—has been particularly harmful because it has forced public universities to raise tuition. This directly affects access for low-income students—one of the key responsibilities of public higher education. For this reason, the authors highlight financial aid for low-income, in-state undergraduate students as the most important program that institutions can provide. The UW’s Husky Promise program, which provides free tuition to resident undergraduates with financial need, is an example of this type of financial aid.
To cope with diminished state funding, the report also recommends:
- Regional alliances with other PRUs, allowing the schools to combine programs;
- Focusing fundraising on unrestricted donations, allowing universities to put the money towards core educational programs;
- State-led creation of PRU long-term funding plans, allowing universities to more securely plan for their future; and
- Advocating for additional federal research support.
- Form Public-Private Partnerships:
In the authors’ view, there is a natural alliance between PRUs and businesses. PRUs are critical to the business community: they educate workers and provide research upon which businesses and corporations build their enterprises. Universities also rely on businesses for funding assistance and for employment opportunities for their graduates. The report recommends that businesses provide research funds, well-paid internships, scholarships, and other support mechanisms for universities and their students. Universities, in turn, should provide easier access to their research and actively work towards partnering with businesses. The UW has a variety of public-private partnerships, including its Global Innovation Exchange (GIX), a partnership with Microsoft and Tsinghua University in Beijing.
- Serve Students:
- Simplify financial aid: Filling out a FAFSA is a complicated process which can impede access to higher education. Simplifying the loan application procedure would help ensure that a larger proportion of students who are interested in higher education get access to the funds they need to pursue their goals.
- Track student performance: Thanks to improved data analysis tools, universities have an enhanced ability to help students graduate. The report highlights Georgia State University (GSU) as a particularly successful example. GSU uses an algorithm to pinpoint students at risk of failing or dropping out, enabling the university’s advising services to intervene on a one-to-one basis. According to the report, these interventions have increased graduation rates by 20 percent, reduced time to graduation, and eliminated graduation rate differences between racial, ethnic, and socioeconomic groups.
- Improve transfer pathways: The report recommends that four-year institutions work with community colleges to simplify the transfer procedure. Doing so can make higher education more affordable and accessible and can help transfer students graduate with a four-year degree on time and with as little debt as possible.
Two overarching themes of the Lincoln Project’s report are partnerships and accessibility. Public universities will need both in order to continue fulfilling their dual missions of conducting top-level research and providing high-quality, affordable higher education.
The rising costs of college are a popular subject for everyone from presidential candidates to media outlets. Parents and students blanche as published tuition prices climb ever higher. But the published price – often referred to as the “sticker price” for colleges – offers a misleading picture of the cost of higher education. OPB has updated our brief to reflect the newest available data on published price vs. net price. Highlights include:
- Sector-wide data on increases in published price and net price for public and private four-year colleges
- A description of how declining state investment in higher education has spurred tuition increases
- A table of the top 25 research universities’ net price for resident undergraduates receiving grant or scholarship aid
Our updated brief is accessible here.
Over the past few months, income share agreements (ISAs) have received significant attention from political candidates, higher education advocates, and news sources. A new OPB brief takes a closer look at ISAs by:
- Exploring differences between and the history of privately funded ISAs and publicly funded ISAs (such as Pay It Forward).
- Comparing ISAs to federal income-based repayment (IBR) plans in terms of overall structure, years to repayment, monthly payments, and total cost over time.
- Identifying remaining issues regarding ISAs and their implementation.
- Offering alternatives like improving federal loan repayment options.
Please contact Jed Bradley if you have any questions.
The House and Senate did not come to an agreement on a 2016 supplemental budget by the end of the 60-day regular session, which was slated to end March 10. Several news outlets reported the tense ending, which featured Governor Inslee vetoing 27 bills (see examples here, here, and here). The Governor convened a 30-day special session, which began immediately.
On Friday, leadership in the Senate Ways & Means Committee released a new proposal for a 2016 supplemental operating budget (PSSB 6667). Last month, OPB released a brief comparing the Governor’s proposal, House proposal, and the Senate’s original proposal. That brief outlines the major components of each budget.
Like the Senate’s original proposal, this offer proposes $3.513 million in additional biennial funding to “true up” the tuition backfill associated with 2ESB 5954. However, both Senate proposals would almost entirely negate this additional backfill funding by converting activities conducted by the Office of Financial Management (OFM) into a central service charged to state agencies. Over the biennium, the UW would be charged $1.252 million from its state general fund appropriation and $2.042 million from tuition operating fee revenue for these OFM central services, a total of $3.294 million.
This proposal differs from the original Senate proposal in that it:
- Does not cut WWAMI: The original proposal included a cut of $1.2 million
- Does not fund a proviso for youth suicide prevention at UW’s Forefront: The original proposal allocated $97,000 in FY17 to fund 2SSB 6243, but that bill did not pass the House.
- Shifts $18 million in cost savings from College Bound (CB) program to State Need Grant (SNG): The original proposal shifted only $14 million, effectively cutting SNG by $4.5 million.
During a press conference responding to this release, leadership in the House emphasized continuing negotiations toward a compromised budget and gave no indication that they would release a public budget offer.
Stay tuned to the OPBlog for updates on proposed budgets.
This week, leadership in the House and Senate released their respective supplemental operating and capital budget proposals for the current biennium (FY16 & FY17), which follow the December release of Governor Jay Inslee’s proposals. As a reminder, the House and Senate proposals will be amended before they pass their respective chambers.
Please see the OPB brief for a detailed comparison of the House, Senate and Governor’s supplemental operating and capital budget proposals.
- The budget released by the leadership in the Senate Ways & Means Committee would provide the most funding overall, largely because it includes additional funding for the resident undergraduate tuition reduction backfill associated with 2ESB 5954.
- None of the three capital budgets provide additional funding for the UW beyond the original 2015-17 capital budget.
Legislators will have until March 10, the last day of session, to complete and pass a compromise budget.
See the table below for a quick comparison of the budget proposals:
The Obama administration has introduced a plan to bring back year-round Pell Grants and to create a $300 bonus for Pell recipients taking at least 15 credits a semester. Both elements of the plan are designed to incentivize students to graduate faster and accrue less debt in school. The plan would cost $2 billion over the next year, according to the Department of Education.
The year-round Pell Grant program was initially put in place by President Bush in 2008 but was cut in 2011 as a budget-saving measure. While the effort to reinstate the program will likely face significant Congressional opposition, there is some bipartisan support. Senator Lamar Alexander (R-LA), Chair of the Senate education committee, and Democratic Senator Michael Bennet of Colorado are cosponsoring legislation to reintroduce year-round Pell Grants. “We have long supported providing students a more flexible Pell Grant program and hope this is one of many areas Congress and the administration can work together to strengthen higher education,” a Republican education committee spokesman was quoted as saying in Inside Higher Ed. Even with this bipartisan support, however, the administration faces a difficult task in getting the legislation through a very budget-conscious Congress.
The $300 bonus, dubbed “15 to finish” by education non-profits, is also somewhat controversial, though the division is between a different set of stakeholders than the Pell Grant expansion. Many college completion non-profits support 15 to finish, saying that encouraging 15 credit semesters is an important tool in incentivizing Pell recipients to graduate on time. The plan has drawn criticism, however, from community college leaders and adult student advocates, who contend that 15 credits is too many for students who are busy working or who have come into higher education unprepared for college-level work.
See the UW Federal Relations department post for further information on the Pell Grant proposal.
New York state has recently instituted the “Get on Your Feet” loan forgiveness program in an effort to keep young college graduates living and working in the state. The program, originally introduced as a part of Governor Cuomo’s 2015 Opportunity Agenda, is designed to help struggling recent graduates in the state pay back their student loan debt. Get on Your Feet is the most recent extension of NY state’s financial aid to its college graduates, which includes loan forgiveness for several public service professions and need-based state grant programs with awards of up to $5,165.
There are a number of eligibility stipulations for the program, including that the graduate be enrolled in the federal Income-Based Repayment plan or the Pay As You Earn plan, that they are making less than $50,000 per year, that they work and have graduated in-state, and that they have received their degree during or after the 2014-15 academic year. Get on Your Feet also only applies to federal loans; private loans are ineligible for relief through the program.
The plan, which has been covered by CNN Money, the Huffington Post, Forbes, and the Washington Post, is not without controversy – recent graduates who do not qualify for Get on Your Feet are upset because they feel they are paying for others’ college costs while reaping none of the benefits of the loan forgiveness. The program is financed through the state’s General Fund, for which the primary sources of revenue are in-state taxes.
The Washington Post article above (linked again here) lists some of the other states that have forms of student loan forgiveness. Forty-five states and the District of Columbia offer some form of loan forgiveness for its residents, according to the article, but New York is the only state that specifically targets lower-income graduates. Most programs in other states are concentrated in public-service industries; health, social work, teaching, and public law.
Washington state provides health-care professionals with loan forgiveness of up to $70,000 over two years (details here) and also gives financial assistance in the form of the State Need Grant (SNG), which distributes financial aid awards up to the price of in-state undergraduate tuition—$10,344 at UW—for Washington residents whose families meet the minimum income requirements.
Unfortunately, more than 33,500 students across Washington, 3,500 of whom attend the UW, are eligible to benefit from the SNG but do not because the program has not received sufficient funding from the state.
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