State Relations

April 13, 2010

Sine Die (redux!) 2010

The legislature finally adjourned just after 1:00AM this morning, exactly thirty days into its one week special session (HA!). Reaching an agreement on the components of an $800 Million revenue package took significantly longer than originally planned. You can find a good overview of all of the different tax proposals that have been discussed here.

The final revenue package raises almost $800 Million through a mixture of business taxes and “sin” taxes on beer, soda and cigarettes.  Part of the revenue package will “buy back” the Governor’s proposed cuts to student financial aid, including the State Need Grant.  This is fantastic news for UW students.  The state need grant is an essential component to Husky Promise and helps make college more affordable for thousands of Washington State residents.

On the other side of the ledger, the 2010 state supplemental operating budget includes a 6.3% cut to higher education institutions.  This cut is in addition to the cuts we received in last year’s budget.  For the University of Washington, the 2010 cut totals  $20.5 Million.  The impact of this cut will be significant, and UW departments are already preparing plans on how each will manage budget reductions.

A positive outcome is that a proposal to transfer student building fees to the operating budget didn’t survive.  Building fees are paid as a portion of student tuition.  The transfer would have meant an additional $18 Million cut to the UW.  The University also received flexibility to implement SB 6503, a bill requiring employee furloughs.  In lieu of furloughs, the University may submit a compensation and operation reduction plan to the Office of Financial Management.  This will allow the the UW the flexibility to implement a savings plan with strategies that work within our unique budget structure.

I will be back with a full legislative update in the next day or two.  In the meantime, all this talk of taxes reminds me it’s almost April 15th! Did you remember to claim your opportunity credit?