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2015 Legislative Session Mid-Session Update

2015 Legislative Session Mid-Session Update. Updated: March 2, 2015. 2015 Mid-Session Update. Budget(s) Update McCleary Implementation Educator Compensation Revenue Question. 2015-17 Transportation Budget. 11 bill package: Revenue bill; Bond bill; Spending Plan; 8 “reforms”

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2015 Legislative Session Mid-Session Update

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  1. 2015 Legislative SessionMid-Session Update Updated: March 2, 2015

  2. 2015 Mid-Session Update • Budget(s) Update • McCleary Implementation • Educator Compensation • Revenue Question

  3. 2015-17 Transportation Budget • 11 bill package: • Revenue bill; Bond bill; Spending Plan; 8 “reforms” • $15.0 Billion Spending Plan • Funds 6 “megaprojects” & 58 regional projects • $3.5 million – Safe Routes to Schools Grants • 11.7 cent gas tax increase • SB 5990-Exempts certain transportation projects from sales tax; diverts other trans sales tax from General Fund to transportation

  4. 2015 Supplemental Budget • “Early Action” Supplemental, HB 1105 • $217.9 million increase over 2013-15 • Funds: • Wildfires & Oso landslide • Mental health beds (Supreme Court) • In-home care compensation (Supreme Court) • Extended foster case services • Signed Feb. 19

  5. 2015-17 Capital Budget Superintendent’s Request K-12 Education - $3.18 billion • School Construction Assistance Program - $1.14 billion • K-3 Class-size Reduction - $1.98 billion • Local Assistance Grants - $50.2 million • Energy Grants - $8.0 million • Skills Centers - $43.7 million

  6. 2015-17 Capital Budget Governor’s Request K-12 Education - $657.2 million • “Fully Funds” School Construction Assistance Program - $596.1 million • All-day Kindergarten - $10.0 million • Small Repair/Healthiest Next Generation - $5.0 million • Skills Centers - $36.1 million

  7. Capital Budget • SB 5859 (and HB 2161) • Enhancements to Construction Cost Allowance & Student Space Allocation • Raises minimum funding floor from 20 percent to 30 percent • HB 1941/HJR 4210 • Simple Majority for school district bonds • November election only

  8. 2015-17 Operating Budget

  9. 2015-17 Operating Budget Proposal 9

  10. Superintendent Dorn 2015-17 Budget Proposal K-12 Education Policy Enhancements 0.41 10

  11. Supt. Dorn 2015-17 Budget Proposal Basic Education Enhancement, HB 2261/HB 2776 Source: OSPI, 10/14 11

  12. 2015-17 Operating Budget Proposal 12

  13. Gov. Inslee 2015-17 Budget Proposal K-12 Education Policy Enhancements 13

  14. McCleary v. State of Washington — Implementation —

  15. Education Funding Task Force Adopted Spending Plan 15 Source: Joint Task Force on Education Funding, Final Report, 12/12

  16. Initial McCleary Basic Education Investment 2013-15 Operating Budget $5 $4 $3 $2 $1 $0 Billions 16

  17. State’s K-12 Funding Promises Testimony Under Oath During McCleary Trial (Per Pupil State Funding) 17 Source: Network for Excellence in Washington Schools, 9/14

  18. State’s K-12 Funding Promises • $7,279 per pupil funding, as adopted in 2ESSB 5034 (2013-15 budget) • $9,710 per pupil funding by 2017-18, as testified in trial—does not include market rate salaries, inflation after 2007-08 or capital construction needs • $12,701 per pupil funding by 2017-18, promised funding including market rate salaries ($2.9 billion) as recommended by Compensation Technical Working Group (June 2012) • Calculation: $9,710 + $2,991=$12,701 per pupil 18 18

  19. Real and Steady Progress Towards Full Funding — State Testimony vs. Actual Funding, 2013— (Per Pupil State Funding) 19 Source: Network for Excellence in Washington Schools, 9/14

  20. Real and Steady Progress Towards Full Funding — State Testimony vs. Actual Funding, 2014— (Per Pupil State Funding) 20 Source: Network for Excellence in Washington Schools, 9/14

  21. Real and Steady Progress Towards Full Funding — State Testimony vs. Actual /Proposed Funding— (Per Pupil State Funding) 21 Source: Network for Excellence in Washington Schools, 1/15

  22. State’s K-12 Funding Promises

  23. Competitive Public School Employee Compensation

  24. McCleary & Compensation “The McCleary ruling’s statutory components derive from HB 2776 (2010) which required funding enhancements in four areas by the 2017-18 school year: transportation (completed in 13-15), MSOC (required to be done in 15-17), and all-day kindergarten and K-3 class size reduction (required to be done in the 17-19 biennia).” - Sen. Andy Hill Ways & Means Chairman 24

  25. McCleary & Compensation • In 2009, ESHB 2261 adopted, establishing a new definition of basic education and a new education funding system. • ESHB 2261 stated the Legislature’s intent to “enhance the current salary allocation model,” with the understanding that “continuing to attract and retain the highest quality educators will require increased investments.” 25

  26. The Court & Compensation “Substantial evidence at trial also showed that the State consistently underfunded staff salaries and benefits. Testimony revealed that the State allocation for salaries and benefits fell far short of the actual cost of recruiting and retaining competent teachers, administrators, and staff.” - McCleary ruling Jan. 5, 2012  26

  27. The Court & Compensation “Another area in which the State's Report falls short concerns personnel costs. Quality educators and administrators are the heart of Washington's education system. The Report … skims over the fact that state funding of educator and administrative staff salaries remains constitutionally inadequate.” - McCleary Order Jan. 9, 2014  27

  28. Supreme Court & Compensation “Nothing could be more basic than adequate pay. The inescapable fact is that salaries for educators in Washington are no better now than when this case went to trial....It is deeply troubling that the State's Report does not address this component of ESHB 2261 or offer any plan for meeting its goals.” - McCleary Order Jan. 9, 2014  28

  29. Compensation Technical Working Group • Enacted in 2009, ESHB 2261 • Convened in July 2011 • Statutory Charge: Recommend the details of an enhanced salary allocation model that aligns state expectations for educator development and certification with the compensation system. • Report submitted in June 2012 29 29

  30. Compensation Technical Working Group June 2012 Recommendations 30 30

  31. Compensation Technical Working Group June 2012 Recommendations Full Report at: http://bit.ly/1qeFvcb 31 31

  32. School District Employee Salaries Percentage of Average Salary Paid by State and Local District Note: Salaries are for all programs and do not include benefits Source: OSPI, 9/14

  33. Local Funding Workgroup Key Recommendations: • Fund the full cost of basic education labor first, followed by other improvements as outlined in ESHB 2261 and SHB 2776 • Update and implement recommendations of Compensation Technical Working Group • Recognize and mitigate impact of any reduction to local levy authority on districts’ ability to meet financial obligations White Paper: http://bit.ly/1wxMg3a Talking Points: http://bit.ly/1GACQ7l

  34. Where will the Legislature find the funds to enhance K-12 Education— and other necessary state services? Revenue Growth? Spending Reductions? Tax Increases? 34

  35. Four-year Budget Outlook (Dollars in Millions) 35 35 Source: Economic & Revenue Forecast Council, 11/14

  36. 2015-17 Budget Outlook $4.45B Source: Office of Financial Management, 11/14

  37. Spending Reductions? Two-thirds of the state budget constitutionally or federally protected 37 Source: Office of Financial Management, 8/14

  38. General Fund-State Revenues as Percentage of Washington Personal Income 38 38 Source: Office of Financial Management, 12/13

  39. Taxable Sales as Percentage of Personal Income 39 Source: Economic & Revenue Forecast Council, 9/14

  40. Daniel P. Steele Assistant Executive Director, Government Relations 825 Fifth Avenue SE Olympia, WA 98501 360.489.3642 dsteele@wasa-oly.org 2015 Mid-session Update Updated: March 2, 2015

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