FY 2013-14 COMMUNITY COLLEGES BUDGET S.B. 199: GOVERNOR'S RECOMMENDATION
Senate Bill 199 (as introduced) Vehicle for Governor’s Recommendation line items is Senate Bill 222
Committee: Appropriations
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$294,130,500 |
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1. Performance Funding. The Governor included a $5.8 million GF/GP (2.0%) increase for community college operations distributed through a modified version of the Performance Indicators Task Force Formula that has been used in recent budgets. The Governor also reallocates $1,277,500 allocated to community colleges in FY 2012-13 based on local strategic value. This results in a total of $7,124,600 being distributed through the Governor's proposed formula. The local strategic value component is replaced by a new allocation based on the number of skilled trades program students placed in a relevant job or apprenticeship, with extra weighting for placing a student-veteran. Table 1 provides details by college on the Governor's proposed allocations. |
5,847,100 |
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2. Michigan Public School Employees Retirement System (MPSERS) Rate Cap. The Governor included $31.4 million GF/GP to fund the difference between the employer's capped contribution rate for unfunded accrued liabilities (20.96%) and the actual unfunded actuarial accrued liability contributions rate. MPSERS reform legislation requires the State to pay the difference between these amounts. The Governor is recommending a supplemental of $12.5 million to fund the amount necessary in FY 2012-13. |
31,400,000 |
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3. MPSERS Retiree Health Care. In FY 2012-13 the Governor recommended $1,733,600 appropriation from the School Aid Fund for the purpose of offsetting the increase in MPSERS retirement contributions attributable to the 0.25% increase in retiree health care costs. Distributions were to be based on the FY 2011-12 MPSERS payroll. The enacted version of the budget included the funding, but allocated the funds to community colleges on an across-the-board basis. The Governor is continuing the funding, but again recommending that the funds be allocated to community colleges based on their MPSERS payroll. Table 2 delineates the estimated difference in allocation methods. |
0 |
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4. Virtual Learning Collaborative. The Virtual Learning Collaborative (VLC) provides access to courses offered by all Michigan public community colleges. In 2009 the Michigan Community College Association (MCCA) Board of Directors approved an affiliate membership for four-year institutions. To date, Lawrence Tech and Grand Valley State University have become members. The new State funding will be used for the development of course aggregator software, development of a "pathway to credential" tool that will identify for students courses toward a career path, develop analytics software that informs colleges of course demand for decision making of future offerings, and development of a repository of online courses and resources for use by faculty at member institutions. |
1,100,000 |
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5. Renaissance Zone Reimbursements. The Governor included $3.5 million GF/GP for Renaissance Zone tax reimbursements pursuant to Public Act 376 of 1996. This appropriation was included in the Department of Treasury budget in FY 2012-13 at the same level of funding. |
3,500,000 |
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$41,847,100 |
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FY 2013-14 Governor's Recommendation........................................................................... |
$335,977,600 |
FY 2013-14 COMMUNITY COLLEGES BUDGET BOILERPLATE HIGHLIGHTS
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Changes from FY 2012-13 Year-to-Date: |
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1. MPSERS Reimbursements. Provides that appropriation for MPSERS Retiree Health Care Reimbursement shall be distributed based one each college's proportional MPSERS payroll. See item #3 on previous page. (Sec. 207a) |
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2. MPSERS Reform Costs. Provides that appropriation for MPSERS reform costs shall be used for payment of the difference between the unfunded actuarial accrued liability contribution rate calculated pursuant to the MPSERS Act and the statutory maximum employer rate of 20.96%. See item #2 on previous page. (Sec. 207b) |
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3. Virtual Learning Collaborative. Provides that funds appropriated for this one-time project be distributed to a community college of behalf of the Michigan Community College Association for the purposes of enhancing the Virtual Learning Collaborative. Requires report on use of funds upon request. (Sec. 207c) |
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4. Transparency. Requires each community college to make available through links on its website homepage its annual operating budget, links to the most recent activities classification structure report, current collective bargaining agreements, health care plans, audits and financial reports, and compliance with best practices. Provides that State Budget Director shall determine compliance and allows for withholding of State aid payments for noncompliance. Subsection 4 provides for reports on budgeted revenue and expenditures. The Governor added projected General Fund revenue, expenditures, and debt service obligations to the items to be available on the website. The Governor also replaced "shall" with "may" regarding the Budget Director determining compliance. (Sec. 209) |
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5. Collaborations with Four-Year Universities. Encourages community colleges to increase collaboration with universities, local employers, and other community colleges. Governor added the goal of developing equivalency standards of core college courses and identifying equivalent courses offered by institutions. (Sec. 210) |
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6. Performance Indicators Task Force. Provides that it is the intent of the Legislature that performance measures be reviewed and more fully implemented for distribution of State funding in future. Provide specific allocations for current-year funding increases and earmarks funding increases for retirement costs. The Governor modified this section by tying local strategic value (best practices) to the receipt of all performance funding and using 15% of the formula previously allocated for Local Strategic Value to a new Skilled Trades Jobs Placement category. Funds resulting from a college's failure to qualify for performance funding will lapse to the General Fund. The Governor also removed intent language regarding use of the formula in future years and also removed last year's earmark of funding increases for retirement costs. (Sec. 230) Governor's modified Performance Indicators distribution • 50% proportionate to FY 2012-13 base • 10% contact hour equated students • 7.5% administrative costs • 17.5% weighted degrees • 15.0% Skilled Trades Jobs Placement |
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7. Deleted Provisions. The Governor deleted: Second-year appropriation intent language and replaced it with line items (Sec. 201a); buy American/buy Michigan intent language (Sec. 204); depressed and deprived communities compete for and perform college contracts (Sec. 205); prohibits use of appropriations for construction or maintenance of self-liquidating projects and requires compliance with JCOS use and finance requirements -- includes penalty for noncompliance (Sec. 208); committee to develop a process to improve transferability of core college courses between colleges and universities (Sec. 210(a)); encourages community colleges to achieve efficiencies through collaborations (Sec. 212); intent regarding review by interested parties of statutory mandates (Sec. 216); prohibition on use of appropriations for purchase or lease of foreign automobiles (Sec. 227); and prohibition on disciplinary action against an employee for communicating with a member of the legislature or legislative staff (Sec. 228). |
Date Completed: 2-14-13 Fiscal Analyst: Bill Bowerman
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.