SUBSTITUTE FOR

SENATE BILL NO. 171

A bill to make appropriations for community colleges and

certain state purposes related to education for the fiscal year

ending September 30, 2012; to provide for the expenditure of those

appropriations; to provide anticipated appropriations for the

fiscal year ending September 30, 2013; to establish or continue

certain funds, programs, and categories; and to prescribe the

powers and duties of certain state departments, institutions,

agencies, employees, and officers.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

PART 1

LINE-ITEM APPROPRIATIONS

FOR FISCAL YEAR 2011-2012

Sec. 101. Subject to the conditions set forth in this act, the

amounts listed in this part are appropriated for community colleges

and certain other state purposes relating to education for the

fiscal year ending September 30, 2012, from the funds indicated in

this part. The following is a summary of the appropriations in this

part:

COMMUNITY COLLEGES

APPROPRIATION SUMMARY

GROSS APPROPRIATION.................................... $ 283,880,500

Interdepartmental grant revenues:

Total interdepartmental grants and intradepartmental

transfers............................................ 0

ADJUSTED GROSS APPROPRIATION........................... $ 283,880,500

Federal revenues:

Total federal revenues................................. 0

Special revenue funds:

Total local revenues................................... 0

Total private revenues................................. 0

Total other state restricted revenues.................. 195,880,500

State general fund/general purpose..................... $ 88,000,000

Sec. 102. OPERATIONS

Alpena Community College............................... $ 4,984,300

Bay de Noc Community College........................... 5,040,200

Delta College.......................................... 13,336,200

Glen Oaks Community College............................ 2,320,900

Gogebic Community College.............................. 4,140,500

Grand Rapids Community College......................... 16,649,700

Henry Ford Community College........................... 20,145,000

Jackson Community College.............................. 11,219,700

Kalamazoo Valley Community College..................... 11,522,700

Kellogg Community College.............................. 9,047,900

Kirtland Community College............................. 2,872,900

Lake Michigan College.................................. 4,937,700

Lansing Community College.............................. 28,651,900

Macomb Community College............................... 30,490,300

Mid Michigan Community College......................... 4,266,800

Monroe County Community College........................ 4,094,000

Montcalm Community College............................. 2,946,800

C.S. Mott Community College............................ 14,526,400

Muskegon Community College............................. 8,256,700

North Central Michigan College......................... 2,886,500

Northwestern Michigan College.......................... 8,430,300

Oakland Community College.............................. 19,455,900

St. Clair County Community College..................... 6,534,100

Schoolcraft College.................................... 11,477,300

Southwestern Michigan College.......................... 6,143,700

Washtenaw Community College............................ 11,827,300

Wayne County Community College......................... 15,425,900

West Shore Community College........................... 2,248,900

GROSS APPROPRIATION.................................... $ 283,880,500

Appropriated from:

Special revenue funds:

State school aid fund.................................. 195,880,500

State general fund/general purpose..................... $ 88,000,000

PART 2

PROVISIONS CONCERNING APPROPRIATIONS

FOR FISCAL YEAR 2011-2012

GENERAL SECTIONS

Sec. 201. Pursuant to section 30 of article IX of the state

constitution of 1963, total state spending from state resources

under part 1 for fiscal year 2011-2012 is $283,880,500.00 and state

spending from state resources to be paid to local units of

government for fiscal year 2011-2012 is $283,880,500.00. The

itemized statement below identifies appropriations from which

spending to local units of government will occur:

Operations............................................. $ 283,880,500

TOTAL.................................................. $ 283,880,500

Sec. 202. The appropriations authorized under this act are

subject to the management and budget act, 1984 PA 431, MCL 18.1101

to 18.1594.

Sec. 203. Unless otherwise specified, a community college

receiving appropriations in part 1 shall use the Internet to

fulfill the reporting requirements of this act. This requirement

may include transmission of reports via electronic mail to the

recipients identified for each reporting requirement or it may

include placement of reports on an Internet or Intranet site.

Sec. 209. Funds appropriated in part 1 shall not be used for

the purchase of foreign goods or services, or both, if

competitively priced and of comparable quality American goods or

services, or both, are available. Preference should be given to

goods or services, or both, manufactured or provided by Michigan

businesses, if they are competitively priced and of comparable

quality. In addition, preference should be given to goods or

services, or both, that are manufactured or provided by Michigan

businesses owned and operated by veterans, if they are

competitively priced and of comparable quality.

Sec. 210. The principal executive officer of each community

college receiving appropriations in part 1 shall take all

reasonable steps to ensure businesses in deprived and depressed

communities compete for and perform contracts to provide services

or supplies, or both. Each principal executive officer shall

strongly encourage firms with which the community college contracts

to subcontract with certified businesses in depressed and deprived

communities for services or supplies, or both.

Sec. 211. The money appropriated in this act is appropriated

for community colleges with fiscal years ending June 30, 2012 and

shall be paid out of the state treasury and distributed by the

state treasurer to the respective community colleges in 11 monthly

installments on the sixteenth of each month, or the next succeeding

business day, beginning with October 16, 2011. Each community

college shall accrue its July and August 2012 payments to its

institutional fiscal year ending June 30, 2012. However, if a

community college fails to submit all verified Michigan community

colleges activities classification structure data for school year

2010-2011 to the workforce development agency by November 1, 2011,

the monthly installments shall be withheld from that community

college until those data are submitted. The amount distributed to a

community college or department shall not exceed the net state

allocation authorized by this act.

Sec. 216. (1) A community college shall pay the employer's

contributions to the Michigan public school employees' retirement

system created by the public school employees retirement act of

1979, 1980 PA 300, MCL 38.1301 to 38.1408, as a condition of

receiving money appropriated under this act.

(2) A community college shall not pay an employer's

contribution to more than 1 retirement fund providing benefits for

an employee.

Sec. 217. Money appropriated in part 1 shall not be used to

pay for the construction or maintenance of a self-liquidating

project. A community college shall comply with the current use and

finance requirements of the joint capital outlay subcommittee

(JCOS) for any construction, renovation, or other capital outlay

projects pursuant to JCOS policy. The appropriation in part 1 for a

community college that fails to comply with JCOS requirements shall

be reduced by 1% for each violation.

Sec. 218. (1) From the funds appropriated in part 1, each

community college shall develop, post, and maintain, on a user-

friendly and publicly accessible Internet site, a comprehensive

report categorizing all institutional general fund expenditures

made by the community college within a fiscal year. The report

shall include institutional general fund expenditure amounts

categorized both by each academic unit, administrative unit, or

external initiative within the community college and by major

expenditure category, including faculty and staff salaries and

fringe benefits, facility-related costs, supplies and equipment,

contracts, and transfers to and from other community college funds.

The report shall also include a list of all employee positions

funded partially or wholly through institutional general fund

revenue that includes the position title, name, and annual salary

or wage amount for each position. The community college shall not

provide financial information on its website under this section if

doing so would violate a federal or state law, rule, regulation, or

guideline that establishes privacy or security standards applicable

to that financial information.

(2) Each community college shall report the following

information to the senate and house appropriations subcommittees on

community colleges, the senate and house fiscal agencies, and the

state budget office by November 15, 2011, and post that information

on the Internet website required under subsection (1):

(a) Budgeted fiscal year 2011-2012 general fund revenue from

tuition and fees.

(b) Budgeted fiscal year 2011-2012 general fund revenue from

state appropriations.

property taxes.

(d) Budgeted fiscal year 2011-2012 total general fund revenue.

(e) Budgeted fiscal year 2011-2012 total general fund

expenditures.

Sec. 224. (1) Recognizing the critical importance of education

in strengthening Michigan's workforce, the legislature encourages

the state's public community colleges to explore ways of increasing

collaboration and cooperation with 4-year universities,

particularly in the areas related to training, instruction, and

program articulation.

(2) Recognizing the central role of community colleges in

responding to local employment needs and challenges, community

colleges shall develop and continue efforts to collaborate with

local employers and students to identify local employment needs and

strategies to meet them.

(3) Community colleges are encouraged to collaborate with each

other on innovations to identify and meet local employment needs.

Sec. 225. (1) A committee shall be created to develop a

process to improve the transferability of core college courses

between community colleges and public universities on a statewide

basis. Building off of the Michigan association of college

registrars and academic officers agreement and existing

articulation agreements in place between individual institutions,

the committee shall work to develop equivalency standards of core

college courses and identify equivalent courses offered by the

institutions.

(2) The committee shall be composed of the following:

(a) Ten representatives from community colleges selected by

the Michigan community college association.

(b) Ten representatives from public universities selected by

the presidents council, state universities of Michigan.

speaker of the house.

(d) One member of the house of representatives selected by the

minority leader of the house of representatives.

(e) One member of the senate selected by the senate majority

leader.

(f) One member of the senate selected by the senate minority

leader.

(3) The committee shall submit an interim project status

report to the senate and house appropriations subcommittees on

community colleges and higher education, the senate and house

fiscal agencies, and the state budget director by March 1, 2012.

Sec. 234. Community colleges shall do the following:

(a) Undertake active measures to promote equal opportunities,

eliminate discrimination, and foster a diverse student body and

administration among all people including, but not limited to,

women, minorities, seniors, veterans, and people with disabilities.

(b) Review, analyze, and eradicate activities that may tend to

discriminate.

Sec. 247. Funds appropriated in part 1 shall not be used to

enter into a lease for, or to purchase, a vehicle assembled or

manufactured outside of the United States if competitively priced

and comparable quality vehicles made in the state of Michigan or

elsewhere in the United States of America are available.

Sec. 249. It is the intent of the legislature to encourage

community college districts to evaluate and pursue efficiency and

cost-containment measures that maximize state funding. Community

colleges shall identify practices that increase efficiencies,

including, but not limited to, establishing joint ventures,

consolidating services, utilizing program collaborations,

maximizing educational benefits through optimal class sizes and

frequency of course offerings, increasing web-based instruction,

eliminating low-enrollment and high-cost instructional programs,

using self-insurance, practicing energy conservation, and utilizing

group purchasing. Efficiency efforts shall also include reviewing

proposed capital outlay projects to increase coordination and

utilization of new facilities, renovation projects, and technology

improvements.

Sec. 250. (1) If the combined total of the maximum amount

appropriated under this act from the state school aid fund for

fiscal year 2011-2012 and the maximum amounts appropriated under

the public acts making appropriations for K-12 state school aid and

higher education for that fiscal year exceeds the amount available

for expenditure from the state school aid fund for that fiscal

year, payments under this act are subject to the proration provided

under this subsection and subsection (2). If proration is

necessary, state payments under this act from the state school aid

fund shall be prorated in the manner prescribed in subsection (2)

as necessary to reflect the amount available for expenditure from

the state school aid fund for fiscal year 2011-2012. However, if

the department of treasury determines that proration will be

required under this section, or if the department of treasury

determines that further proration is required under this section

after an initial proration has already been made for a fiscal year,

the department of treasury shall notify the state budget director,

and the state budget director shall notify the legislature in the

manner provided for proration under section 11 of the state school

aid act, 1979 PA 94, MCL 388.1611, and the legislature may take

action to prevent the proration as described in that section.

(2) If proration is necessary under subsection (1), the

department of treasury shall calculate the proration in payments

under this act that is required under subsection (1) as follows:

(a) The department of treasury shall calculate the percentage

of total state school aid allocated under this act and the public

acts making appropriations for K-12 state school aid and higher

education for the affected fiscal year that is used for payments

for community colleges under this act.

(b) The department of treasury shall recover a percentage of

the total proration amount required under subsection (1) that is

equal to the percentage calculated under subdivision (a) by

reducing payments to community colleges under this act on an equal

percentage basis.

Sec. 251. A community college shall not take disciplinary

action against an employee for communicating with a member of the

legislature or his or her staff.

Sec. 252. It is the intent of the legislature that community

colleges work with public universities in the state to implement

statewide reverse transfer agreements to increase the number of

students that are awarded credentials of value upon completion of

the necessary credits. In doing so, the institutions should work

collaboratively and cooperatively to remove administrative barriers

that result in understating the academic attainment of Michigan's

citizens. It is the intent of the legislature that by August 1,

2012, statewide agreements be in place between community colleges

and public universities that enable students who have earned a

significant number of credits at a community college and transfer

to a baccalaureate-granting institution before completing a degree

to transfer the credits earned at the baccalaureate institution

back to the community college in order to be awarded a credential

of value.

Sec. 253. (1) A committee shall be created to develop a common

set of scores using the ACT assessment to determine placement in

developmental courses at community colleges for students who

recently completed high school. The committee shall be composed of

the following:

(a) Two members of the Michigan house of representatives. One

member shall be designated by the speaker of the house, and 1

member shall be designated by the house minority leader.

(b) Two members of the Michigan senate. One member shall be

designated by the senate majority leader, and 1 member shall be

designated by the senate minority leader.

designated by the Michigan community colleges association.

(d) Four individuals representing K-12 education, with the

speaker of the house, house minority leader, senate majority

leader, and senate minority leader each designating 1 member.

(2) By March 1, 2012, the committee created under subsection

(1) shall submit a report to the senate and house appropriations

subcommittees on community colleges, the senate and house fiscal

agencies, and the state budget office outlining the progress toward

implementing a common set of ACT cutoff scores for placement into

developmental education and credit-bearing courses.

Sec. 257. (1) It is the intent of the legislature that the

senate and house appropriations subcommittees on community

colleges, together with the Michigan community college association

and other interested stakeholders, review any statutory mandates

imposed on community colleges, including those identified by the

legislative commission on statutory mandates established under

former chapter 7B of the legislative council act, 1986 PA 268, and

determine whether those mandates are necessary for the health and

safety of students; are essential to the academic integrity of the

community colleges; exceed any applicable federal requirements; are

superfluous to the core academic programs of the community

colleges; and materially impact local control and governance of the

colleges.

(2) The senate and house subcommittees on community colleges

shall review the estimated costs and benefits of each statutory

mandate reviewed under subsection (1) and shall report their

findings to the state budget director.

Sec. 258. It is the intent of the legislature that each

community college receiving an appropriation in part 1 include in

its admission application process a specific question as to whether

an applicant for admission is a veteran, an active member of the

military, a member of the national guard or military reserves, or

the spouse or dependent of a veteran, active member of the

military, or member of the national guard or military reserves, in

order to more quickly identify potential educational assistance

available to that applicant. As used in this section, "veteran"

means an honorably discharged veteran entitled to educational

assistance under the provisions of section 5003 of the post-911

veterans educational assistance act of 2008, title V of Public Law

110-252, 38 USC 3301 to 3324.

STATE AID - OPERATIONS

Sec. 301. Unless otherwise stated, all data items used in

determining state aid in this act are as defined in the "2001

Manual for Uniform Financial Reporting, Michigan Public Community

Colleges," which shall be the basis for reporting data, and the

"Activities Classification Structure Manual for Michigan Community

Colleges," as amended, which shall be used to document financial

needs of the community colleges.

Sec. 302. A community college shall not include in the

enrollment data reported for determining state aid under this act

any student credit hours or student contact hours for a student

incarcerated in a Michigan penal institution. Exclusion of these

students is intended to avoid the payment of state aid under this

act for the same individuals for whom reimbursement is provided by

the state correctional system.

Sec. 304. It is the intent of the legislature that the

recommendations and performance measures developed by the

performance indicators task force formed pursuant to section 242 of

2005 PA 154 be reviewed and more fully implemented for distribution

of state funding to community colleges in future years.

Specifically, it is the intent of the legislature that the

performance indicators task force review and implement 1 or more

measurable data items for the local strategic value indicator and

review and implement 1 or more measurable data items for an

administrative cost formula component.

Sec. 405. A community college receiving funds in part 1 shall

cooperate with the state's efforts to establish a statewide P-20

education longitudinal data system to comply with the state fiscal

stabilization fund provisions of the American recovery and

reinvestment act of 2009, Public Law 111-5.

REPORTS AND AUDITS

Sec. 502. (1) The auditor general or a certified public

accountant appointed by the auditor general may conduct performance

audits of community colleges as the auditor general considers

necessary.

(2) Not more than 60 days after an audit report is released by

the office of the auditor general, the principal executive officer

of the community college that was audited shall submit to the house

and senate appropriations committees, the house and senate fiscal

agencies, the workforce development agency, the auditor general,

and the state budget director a plan to comply with audit

recommendations. The plan shall contain projected dates and

resources required, if any, to achieve compliance with the audit

recommendations, or a documented explanation of the college's

noncompliance with the audit recommendations concerning the matters

on which the audited community college and office of the auditor

general disagree.

Sec. 504. (1) A community college shall retain certified class

summaries, class lists, registration documents, and student

transcripts that are consistent with the taxonomy of courses. For

each enrollment period during the fiscal year, these certified

documents shall identify clearly by course the number of in-

district and out-of-district student credit and contact hours. The

class summaries and class lists shall be consistent with each other

and shall include the course prefix and numbers, course title,

course credit and contact hours, credit and contact hours generated

by each student, and activity classifications consistent with the

taxonomy. An auditable process shall be used by the community

college to determine the unduplicated head count for in-district

students, out-of-district students, and prisoners for each

enrollment period during the fiscal year.

(2) Contracts between the community college and agencies that

reimburse the community college for the costs of instruction shall

be retained for audit purposes.

Sec. 505. Each community college shall have an annual audit of

all income and expenditures performed by an independent auditor and

shall furnish the independent auditor's management letter and an

annual audited accounting of all general and current funds income

and expenditures including audits of college foundations to the

members of the senate and house appropriations subcommittees on

community colleges, the senate and house fiscal agencies, the

auditor general, the workforce development agency, and the state

budget director before November 15, 2011. If a community college

fails to furnish the audit materials, the monthly state aid

installments shall be withheld from that college until the

information is submitted. All reporting shall conform to the

requirements set forth in the "2001 Manual for Uniform Financial

Reporting, Michigan Public Community Colleges."

Sec. 506. Each community college shall report the following to

the workforce development agency no later than November 1, 2011:

(a) The number of North American Indian students enrolled each

term for the previous fiscal year, using guidelines and procedures

developed by the workforce development agency and the Michigan

commission on Indian affairs.

(b) The number of North American Indian tuition waivers

granted each term, and the monetary value of the waivers for the

previous fiscal year.

Sec. 507. Upon request, a community college shall inform

interested Michigan high schools of the aggregate academic status

of its students for the prior academic year, in a manner prescribed

by the Michigan community college association and in cooperation

with the Michigan association of secondary school principals.

Sec. 508. Each community college shall report to the house and

senate fiscal agencies, the state budget director, and the

workforce development agency by August 31, 2011, the tuition and

mandatory fees paid by a full-time in-district student and a full-

time out-of-district student as established by the college

governing board for the 2011-2012 academic year. This report should

also include the annual cost of attendance based on a full-time

course load of 30 credits. Each community college shall also report

any revisions to the reported 2011-2012 academic year tuition and

mandatory fees adopted by the college governing board to the house

and senate fiscal agencies, the state budget director, and the

workforce development agency within 15 days of being adopted.

Sec. 509. Each community college shall report to the workforce

development agency the numbers and type of associate degrees and

other certificates awarded during the previous fiscal year. The

report shall be made not later than November 15, 2011.

PART 2A

PROVISIONS CONCERNING ANTICIPATED APPROPRIATIONS

FOR FISCAL YEAR 2012-2013

GENERAL SECTIONS

Sec. 1201. It is the intent of the legislature to provide

appropriations for the fiscal year ending on September 30, 2013 for

the line items listed in part 1. The fiscal year 2012-2013

appropriations are anticipated to be the same as those for fiscal

year 2011-2012, except that the line items will be adjusted for

changes in caseload and related costs, federal fund match rates,

economic factors, and available revenue. These adjustments will be

determined after the January 2012 consensus revenue estimating

conference.