Friday, May 15, 2009

Final week is busy

Legislative Update
May 15, 2009

Countdown to Monday - no special session
The House and Senate both approved a “lights-on” bill earlier this week that would keep government going if no other appropriation bills for the 2010-11 biennium are enacted; however, such a bill may not be necessary. Gov. Tim Pawlenty said Thursday that he would like to work out a compromise with legislative leaders, but if such an agreement cannot be reached, he will resolve the budget on his own with line-item vetoes and his authority to unallot, making a special session unnecessary.

Pawlenty said he intends to sign all the omnibus appropriation bills sent to him, but he will line-item veto them where necessary. Without providing any specifics, he said the end result will resemble his budget proposal in January. He has already line-item vetoed the health and human services finance bill. Lawmakers have passed budget bills that leave a $3 billion shortfall between spending and revenues; however, the tax bill passed by the Legislature attempts to resolve that shortfall. The governor vetoed that bill, saying he will not sign a bill with any tax increases included.

Speaker Margaret Anderson Kelliher, DFL-Minneapolis, responded to the governor's plan by saying Minnesotans expect to know where the governor is planning to cut. With the intention of making the process as open as possible, DFL leaders continue to flesh out the budget through the Legislative Commission on Planning and Fiscal Policy. The Commission was meeting at the time of this writing. Legislative leadership is hoping to understand the details behind the governor’s plan.

Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, said he thinks it's important to find a calm and reasonable solution to the end of session and not make rash decisions. Pogemiller said the governor is showing willingness to compromise by signing the budget bills. With only a few days left, can a global deal be reached, or will the governor end up resolving the budget deficit through line-item vetoes and unalloting?

You may view Pawlenty's press conference and the reaction from legislative leadership here.

Agreement reached on higher education omnibus appropriation bill
The House and Senate approved the higher education conference committee report Wednesday. The Senate approved it by a vote of 54-12, and the House approved it 103-31.

Going into conference committee, the governor and House were recommending a 2010-11 base cut to the Minnesota State Colleges and Universities system of $161.8 million, with a one-time federal stimulus appropriation of $133.8 million. The Senate was recommending a cut of $103.8 million, with a one-time federal stimulus appropriation of $75 million. The final bill cuts the Minnesota State Colleges and Universities system $95 million over the 2010-11 biennium, with a one-time federal stimulus appropriation of $79 million, $15.3 million one-time in the current fiscal year 2009 and $63.9 million one-time funds in fiscal year 2010.

For financial aid, the bill language provides for an increase in the tuition maximum for students in four-year programs from $650 to $10,488; does not change the two-year cap; increases the number of semesters a student is eligible for a state grant from eight semesters to nine semesters; funds a summer bridge program, which is a research-based high school-to-college development transition program after high school graduation to prepare students for college-level academic coursework; and increases the living and miscellaneous expenses, or LME, by $800 to $7,000. The bill also increases work study by $5 million and child care assistance grants by $1 million.

Included in the bill for the Minnesota State Colleges and Universities:

• Tuition cap of 5 percent each year with a buy-down using the federal stimulus funds to 3 percent in FY 2010 and 3 percent in FY 2011 for a net increase of 6 percent.

• Language on the American Recovery and Reinvestment Act of 2009 taken from the House bill that states the federal funds may be used for modernization, renovation, or repair of facilities that are primarily used for instruction, research or student housing. Language also reads that the federal funds must be used as a bridge for budget reductions, and may be used to retain faculty and staff jobs, provide severance and early retirement incentives and to mitigate the rising costs of attendance through minimizing tuition increases and the support of student employment opportunities.

• Separate line item for the Office of the Chancellor and Shared Services Division of $47.328 million in both FY 2010 and FY 2011.

• Caps the technology initiative, including technology infrastructure improvements, at $40 million for the 2010-11 biennium.

• $150,000 each year for technical and community college emergency grants for students experiencing extraordinary economic circumstances that may result in the student dropping out of school without completing the term or their program.

• $500,000 ongoing funds each year for the Power of You program at the three current institutions; Saint Paul College, Minneapolis Community and Technical College and Metropolitan State University; and $500,000 one-time funds each year for an expansion of the program to rural and suburban pilot sites.

• $40,000 each year for the Cook County Higher Education Board to provide educational programs and academic support services.

• $1 million each year for the Northeast Higher Education District and area high schools for state-of-the-art technical education opportunities.

• $225,000 each year to enhance the eFolio Minnesota project on the Iron Range

• The Board of Trustees is encouraged to place a priority on identifying and implementing measures to improve the human resources system used by the Minnesota State Colleges and Universities in order to increase efficiencies and equity for faculty and staff.

The provision from the House bill that stated the Minnesota State Colleges and Universities could not fill administrative or managerial positions or use search firms for hiring was not included in the final bill.

The language that capped the funds for underrepresented students at $5 million over the biennium was not included in the final bill.

The Senate language that removes the restriction on marketing to high school students about the financial benefits of the PSEO program was not included in the final bill.

The tuition guarantee language that requires the system to offer students a four-year stable tuition rate was not included in the final bill.

Included in the final bill was the House language on the 60 college and 120 university credit cap policy for the Minnesota State Colleges and Universities system. The language states that the A.A.S. degree is exempt from the 60-credit limit until July 2, 2012. By January 2, 2012, MSCF and MSCSA are to present a joint report to the Legislature on a process for reviewing the credit requirements for an A.A.S. degree.

The provision on course equivalency that directs the Minnesota State Colleges and Universities system to maintain course equivalency guides that include information on the course equivalency and awarding of credit for learning acquired as a result of the successful completion of formal military courses and occupational training, is in the final bill. The system currently does this so is already in compliance.

The language on notice to prospective students on possible impact of criminal records was amended in the final bill to read that each institution is to give notice to every person accepted for admission. The notice is to be given at or before the time of acceptance for admission to the institution and at or before the time students select a major. An institution is not liable for failing to provide notice.

The provision on American made clothing in bookstores was amended to delete the word "only." The final language now reads, "To the extent possible, a bookstore located on the campus of a public college or university in Minnesota must offer for sale clothing or articles of apparel that are manufactured in the United States of America. The college or university must make a report to the legislature on the results of efforts to comply with this section."

There is language included in the bill that encourages public higher education institutions to offer research-based high school-to-college developmental transition programs to prepare students for college-level academic coursework. A program must not be more than one semester of full-time study occurring in the summer following high school graduation.

The provision in the bill that required, as a condition of enrollment, that each entering Minnesota resident student complete the federal application for student aid, or FAFSA, was amended to now require all eligible institutions to adopt policies and procedures that ensure applicants are aware that they must annually complete the FAFSA to be eligible for financial aid. The Minnesota Office of Higher Education is to report to the Legislature.

Regarding the Board of Trustees, language was adopted that amends the board’s membership so that a commissioner of a state agency may not serve as a member of the board. However, the bill includes language that allows for a commissioner currently serving on the board to continue serving the remainder of the term.

The final language on labor market data review for the Minnesota State Colleges and Universities was amended to now read, "The board must assess labor market data when conducting college program reviews. Colleges must provide prospective students with the job placement rate for graduates of technical and occupational programs offered at the colleges."

Language regarding textbooks was included that requires the Office of Higher Education to report to the Legislature on the implementation of textbook information requirements under federal code. The Minnesota State Colleges and Universities system is to take part in preparing the report.

Also included in the bill is the Senate language on a teacher education report. The Minnesota Office of Higher Education and the Minnesota Department of Education are to report on best practices in innovative teacher education programs and teacher education research by June 15, 2010.

The language that was in the House bill for the sale of the Minnesota State College - Southeast Technical aviation training center was included in the final bill.

The language in the final bill on the oral health practitioner and dental therapist programs was amended to be the advanced dental therapist program. Either the University of Minnesota or the Minnesota State Colleges and Universities will be able to train dental therapists and advanced practice dental therapists.

The final bill is available online here.

The spreadsheet is available online here.

As of the time of this writing, the governor has not taken any action on this bill.

Final bonding bill
The House approved the bonding bill on the floor this week by a vote of 109-25. The Senate passed it by a vote of 59-8. The total general obligation bond proceeds is $299.9 million. Included in the bill is $40 million in HEAPR for the Minnesota State Colleges and Universities. All five of the 2008 vetoed projects are also in the final bill:

• Lake Superior College health science center - $11 million

• Mesabi Range Community and Technical College, Eveleth addition - $5.25 million

• Metropolitan State University classroom center - $5.7 million

• North Hennepin Community College center for business - $13.3 million

• System wide classroom renovations - $3.625 million

There are other projects in the bill related to the Minnesota State Colleges and Universities system. Those include:

• Minnesota State College - Southeast Technical - authority to retain proceeds from sale of surplus property

• City of Mankato - $6.5 million grant for the women's hockey Expo Center for use by Minnesota State University, Mankato. The Board may lease land on campus to the city.

• Olmsted County steam line - $5 million grant to construct steam pipeline to the Rochester Community and Technical College campus

• Metropolitan State University and Minneapolis Community and Technical College co-located Law Enforcement Training Center - excluding revenue from student tuition and fees, the university and college may use up to $2 million of college/university funds, or other non-state money for the remainder of the project.

• Owatonna College and University Center - may use remaining funds from property acquisition for capital improvements to the property.

• St. Cloud State University - may use funds available from Brown Science Hall renovation to complete design and construction drawings for the Science and Engineering Lab and to demolish building number 801.

The final bill can be found here.

The final spreadsheet can be found here.

As of the time of this writing, the governor has not taken any action on this bill.

Agriculture and veterans affairs bill passes with overwhelming support
The full House and Senate overwhelmingly approved the agriculture and veterans affairs omnibus bill this week. The bill includes $100,000 each year for mental health counseling support to farm families and business operators through farm business management programs at Central Lakes College and Ridgewater College. Language is also included in the bill that establishes a Feeding Minnesota Task Force to study the consumption of Minnesota-grown produce and livestock by facilitating the donation of harvested products to charities that provide food for hungry people. Included on the task force is a representative from a higher education institution.

Also included in the bill is the Green Jobs Food Production Study provision that requires the Agricultural Utilization Research Institute to prepare a detailed study of the state's food production sector in coordination with the Minnesota State Colleges and Universities; urban, rural, and tribal community-based agriculture and food security organizations; members of the Legislature with service on committees created by the Green Jobs Task Force; and other interested stakeholders. The study is to define the size of the employment base and identify opportunities to increase the number of green jobs in each of the following sector segments: organics and organic value-added processing and local, conventional, natural, traditional, and urban farming.

In the veterans section of the bill, $100,000 each year is included for the costs of administering the Minnesota GI Bill program.

As of the time of this writing, the governor has not taken any action on this bill.

Contract ratification bill passes
Both the Senate and House have passed the state contract ratification bill, SF 1036, and it is now awaiting the governor’s signature. Included in the bill is the 2010-11 Inter Faculty Organization contract. Also included is the 2008-09 MSUAASF contract that was not ratified last session due to timing. The 2010-11 MSUAASF and MSCF contracts, as well as other contracts and plans, will be heard by the Legislative Coordinating Commission Subcommittee on Employee Relations during the interim and ratified by the Legislature next session.

Pension bill
The omnibus pension bill made its way through the committee process this week. The bill, sponsored by Rep. Mary Murphy, DFL-Hermantown, and Sen. Don Betzold, DFL-Fridley, comprises the work of the Legislative Commission on Pensions and Retirement. It includes language from more than two dozen individual bills dealing with pension issues. Included in the bill is the provision that permits the Minnesota State Colleges and Universities system to establish an early separation incentive program for its employees.
The bill is awaiting action by the full House and Senate.

Survey regarding economic future of colleges and universities
Witt/Kieffer, a search firm that conducts searches on behalf of colleges and universities, national educational associations and others, surveyed 1,551 college and university presidents and chancellors in February 2009 to gauge their reactions to the economic crisis.

Responses indicated presidents and chancellors expect the economic downturn will have a lasting impact on higher education including: decreased levels of support from state, local and federal governments; a growing burden on families to finance college education; increased scrutiny of the quality and outcomes of programs; and increasing competition from for-profit schools.

You may view the full report here.

President Obama’s FY 2010 budget
Last week, President Obama released further details of his fiscal year 2010 budget. The details in the administration’s budget will assist Congress in understanding the president’s priorities. Nearly all of the higher education accounts have been level funded at the FY 2009 level. The proposal does provide further detail on the president’s Pell entitlement proposal to make the program a complete and full entitlement, not subject to the annual appropriations process. In addition, federal supplemental educational opportunity grants, or SEOG, is funded at $757 million, and work-study is funded at $980 million. There is an increase of $50 million for the Academic Competitiveness and SMART grants, which encourage students to take more challenging courses in high school and pursue college majors in high demand in the economy, such as science, mathematics, technology, engineering and critical foreign languages.

Institutional aid to higher education institutions to strengthen academic quality, institutional management and financial stability provided through Titles III and Title V of the Higher Education Act both saw overall funding levels drop; however, with regard to discretionary funding, the administration has requested higher funding amounts. The College Cost Reduction and Access Act of 2007 provided mandatory funding for Historically Black Colleges and Universities and Hispanic Serving Institutions. These funds were only provided for fiscal years 2009 and 2010. The president requests an additional $31.5 million for Title III schools and an additional $4.6 million for Title V schools.

The federal TRIO program, designed to motivate and support students from disadvantaged backgrounds, is level funded at $905 million, and GEAR-UP, designed to increase the number of low-income students who are prepared to enter and succeed in postsecondary education, is level funded at $313 million. The administration is recommending an increase of $4.2 million to the Fund for the Improvement of Postsecondary Education, or FIPSE, program, which supports and disseminates innovative reform projects that serve as models for improving the quality of postsecondary education and increasing student access.