With a growing state deficit, now estimated to be $5.2 billion in the 2011-2013 biennium, there are no good options and very painful choices will be made.  In these difficult economic times every area of the budget will be cut.  Many student aid programs have been suspended or significantly reduced so that the Governor and the legislature could focus priority funding on the primary student aid program for State Need Grant.  Independent Colleges of Washington has supported those decisions.

But the recently introduced House budget goes too far.  While the budget increases the maximum grant for State Need Grant for students at public colleges, it cuts the grant by 30% from current policy for students attending private non-profit colleges.

In addition, the bill suspends the State Work Study program. In addition to cutting opportunity and work experience for students, the elimination of work study funding will dramatically impact non-profit organizations and businesses across the state who rely on college students to help them carry out their mission.

We’ve written about budget considerations here and here.

Helping Washington residents attend an independent college is the state’s least expensive way to provide opportunity.  We are concerned that students and families will reconsider college if they see a 30% drop in their grant from current policy.  We need all the educated citizens in our state we can possibly prepare.

These cuts break the trust with students and shifts the longstanding policy of empowering student to choose the college that fits them best.  It will add pressure to the public colleges, meaning even fewer Washington residents will attend college, or attend college in state.

The Senate is poised to introduce its bill, and we hope it will restore funding for Washington residents attending private non-profit colleges.

BY RONALD R. THOMAS AND LOREN J. ANDERSON

Published: 02/04/10
Right now in Olympia, some tough decisions are being made by our elected representatives as they try to hammer out a budget. Hard choices are in front of them, to be sure. But one choice they can’t afford to make is to tell more than 73,000 qualified young men and women that they can’t go to college. That’s one thing none of us can afford.More than 73,000 students in our state receive need-based financial aid that enables them to attend a college or university in Washington.

Most of them also are working and receiving aid from the college they are attending, as well as grants and loans from the federal government. And they are borrowing from their family members, doing everything they can to make something of themselves and build a brighter future – for their families and for all of us, as our next community leaders.

Can our legislators really tell them, “No, you can’t”? Can we afford to let that happen?

We don’t think so. We know what a college education can do for people; it can double their earning power over the course of their lives and dramatically increase their employability and the likelihood of their becoming productive and contributing citizens. A college education gives them the skills and abilities to make a positive difference to our economy and civic life, as the entrepreneurs, teachers and professionals of tomorrow.

We also know that two critical measures on student financial assistance are on the table in Olympia that will either keep these students and others like them in college or deny them that opportunity and put them in the unemployment line.

What our legislators decide will affect not only these students, but ultimately the future prosperity of our state.

It will affect us all.

In January, Gov. Chris Gregoire unveiled a 2010 supplemental budget that would restore $780 million in services that were cut from her December proposal, which, in its shocking cost cuts, starkly revealed the depth of the financial hole facing the state.

One welcome element of the new plan is to restore funding for the State Need Grant program that helps pay the college costs of low-income students across Washington. On average, this grant makes up about a quarter of these students’ total aid.

More than three quarters of State Need Grant students have incomes less than half the state’s median family income of $39,000 for a family of four. One third are students of color.

In most of these cases, $1,000 or $2,000 from a state grant makes it possible for them to realize the dream of an education and stay in school another year. Without it, they would struggle to remain in school or, at worst, be on the street looking for jobs that don’t exist.

The vital element missing from the current budget proposal, however, is support for the State Work Study program. The new budget would suspend the partnership that enables employers to match state funds and hire 9,400 students from 55 colleges and universities to work while they are enrolled.

At our two universities alone, some 600 students count on these jobs and earn on average $3,000 to $4,000 toward their educational costs every year. Without those earnings, once again, most could not be in college.

Work study pays not only for students’ education, but also provides them with valuable work experience and an avenue for career development (or even a job) after graduation. It helps keep small businesses and nonprofits afloat by providing talented employees for less. It’s a true triple play. If the 1,000 organizations where these students work were left in the lurch, some might never offer these job opportunities again.

Without doubt, when budgets are squeezed, tough choices have to be made. The priority, common sense tells us, must be to secure the future.

That future is sitting in a college or high school classroom. And that future is not a column of numbers to cut from a budget. It’s thousands of individuals with dreams of a better life before them.

Let’s not tell Geoff and Lizzy or Justin and Drew or Tyesha and Lindsay that they have no future.

Let’s not tell them they can’t go to college in this state; that they can’t build a meaningful and productive life here.

Let’s not tell ourselves that we don’t care about our children or our own future. That’s the one thing we can’t afford.

Ronald R. Thomas is president of the University of Puget Sound. Loren J. Anderson is president of Pacific Lutheran University.

Gov. Gregoire

Governor Chris Gregoire today made public her proposal to deal with a $2.6 billion budget shortfall. The no-new-revenue, all-cuts proposal bridged the gap in part by cutting about $187 million from state financial aid programs. The largest chunk of that, $146 million, comes out of the State Need Grant Program.

The governor made plain that she knows we won’t like this proposal, and said she doesn’t support it either. But by law she must provide a balanced budget within existing revenue. She referred to the budget she revealed today as “balanced but unjust.” She pledged to propose another budget in January that includes new revenue (closed tax loopholes, tax and fee increases, possible federal dollars) and to restore some of these cuts, including in financial aid.

Need Grant details
The governor made reductions to the Need Grant program in two ways. First, she reduced the eligibility level from the current 70 percent of the state’s median family income ($55,000 for a family of four) down to 50 percent of MFI ($39,000). This would throw an estimated 12,300 currently eligible students out of the program. Those remaining, the lowest income students, would have their grants cut by about half, to about $3,400. These cuts would be effective for next fiscal (and academic) year, not the current one. The reductions amount to a 60 percent cut in the program.

Other aid programs “suspended or eliminated”
The governor’s budget provides no funding in the 2010-11 fiscal year for State Work Study, WAVE, GEAR-UP, Washington Scholars, the GET Ready for Math and Science Scholarship, Health Care Professionals Scholarship and Loan Forgiveness Program, the Passport to College scholarship program for former foster youth, and child care matching grants. This saves about $41 million.

We agree with the governor that huge cuts to student financial aid are not acceptable. We applaud her pledge to restore cuts and “get financial aid to our low-income college students” and keep the doors to higher education open for all capable students, regardless of income.  We will work with the governor and legislators to restore funding for financial aid programs. Higher education is a key to economic opportunity for Washington students and to economic recovery for the state.

Need-based financial aid is a key investment when resources are tight, as it targets those resources to a specific need and delivers results. Aid recipients match their more well-off classmates in graduation rates, post-graduation employment rates and income, graduate school attendance, job satisfaction, and living independently from their parents. Need-based aid creates opportunity. Focusing funding on students in the form of need-based aid empowers students to choose the college—public or private—that is right for them and their career aspirations and dreams.

You can read the governor’s news release about her budget proposal, and this page has links to a host of documents about the budget for the seriously wonky among our readership. View the governor’s pledge on financial aid below, or visit the TVW Web site to  watch this morning’s news conference in its entirety.

Governor Chris Gregoire signed the 2009-11 state budget yesterday, along with a passel of other bills, bringing the work of the 2009 legislature to a close. 

We’ve already covered the highlights of the session from the perspective of Independent Colleges of Washington, most notably a $52 million increase in student aid funding in the face of a budget for which the operative word was “cut.” Keep your fingers crossed the the economy stabilizes and state revenue collection rebounds enough that a special session to re-visit the budget won’t be needed this fall.

The governor vetoed a number of provisions, but no major ones related to higher education. Policy wonks among our readership can check her veto message. The final version of the budget should be posted soon here, under the title of “session law.”

We won’t embed it here, but if you wish to see the bill signing ceremony and the governor’s Q&A with the media afterward, you can go watch the coverage from TVW.

Yesterday, in Bellevue, the Puget Sound Business Journal held the first annual  Corporate Citizenship Awards Luncheon which celebrated and honored (mostly local) businesses and their philanthropic efforts.

I was in the audience yesterday clapping wildly along with many other non-profit colleagues who were also showing their thanks and appreciation to this important sector of our local community. I was extra proud to applaud and celebrate many of ICW’s donors who were recognized for their support of a variety of causes, including education.

Some of ICW’s corporate donors (current and past) who received recognition include:

• Paccar Foundation – the Corporate Champion for Education
• The Boeing Company
• JPMorgan Chase (formerly WaMu)
• Costco
• Alaska Airlines
• US Bank
• Puget Sound Energy
• Sterling Savings Bank
• Ferguson Construction
• Homestreet Bank
• MoneyTree
• Mulvanny G2 Architecture

In this new day and age of cutbacks and belt-tightening, it is important to recognize the lengths these companies go (especially this year) to make corporate giving a priority. We know that they ‘get it’ – year in and year out they understand the importance of helping our neighbors and nonprofit organizations who depend on the support from our corporate partners to make our community a far better place for everyone.

The students who attend the ten member ICW colleges are some of the best prepared to tackle the issues we now face as a state and a country. The generous support from the business community for ICW’s scholarship program has helped to launch the next generation of bright, capable leaders we need. As one local student stated in a scholarship application she recently sent to us, “Seattle University provides an environment in which individuals are molded into out-of-the-box thinkers, passionate leaders and active citizens.”   What more could we ask for?

Thank you for recognizing the importance of independent higher education!

The Washington House  released its proposed budget.  Like the Governor and the Senate, it has chosen to treat low-income Washington residents who choose a private college differently than students who choose a public college — a more expensive option to the state.  This makes no sense! Washington’s student aid policy structure is grounded in student choice — empowering students to choose the college that’s best for them and then following them with the aid they’re eligible for.  In these difficult budgetary times, a more progressive policy choice would be to continue to empower students — and to acknowledge the tuition increase all students experience.  With the enrollment pressure at the state colleges, it would be wise to try to expand enrollment options by encouraging students to choose the option that is less expensive to the state.  

The budget provision to freeze aid for students choosing an unsubsidized college will cost the state more in the long run.  

For students, every bit of aid makes a difference in their enrollment choices. This policy will cut the aid to private-college students by more than $1,400 over two years.  Some of these students will choose a state college — putting even more pressure on enrollment.  To save that $1,400 in aid increases, the state would pay $33,000 for that student to attend a state-subsidized college for those two years.  If you multiply that by four to six years you’ve saved perhaps $4,000 for the four year education at a private college only to pay $66,000 – $100,000 for the four to six years to complete a degree in the state system.   (Even the budget writers say it will take even longer to graduate from a state college because the budget cuts will make it harder to get classes. )  This policy choice doesn’t make long-term sense.  Take Action!

Weekend news coverage of the state’s budget situation is not happy.

With the state’s official revenue forecast due out Thursday, Andrew Garber writes in the Seattle Times that the State budget comes down to unpleasant choices. And Joe Turner of the News Tribune writes that it’s time for a reality check, noting that at least one state senator thinks his colleagues are still in denial about the gravity of the situation.

According to The Times, state Sen. Rodney Tom says Democrats in the senate have at least considered cutting enrollment at state colleges and universities by 10,000. And Garber notes that:

“Higher education, public schools and public safety were touted as priorities for Democrats in the past. Now they’re targets for spending cuts.”

The term “painful cuts” has been a common theme in budget articles all session long. Learn how to help us make sure student financial aid doesn’t feel the pain—visit ICW’s Legislative Action Center.

Some good news in the world of philanthropy. . . JPMorgan Chase Bank (formerly WaMu) will soon announce that a well-known community leader and former regional bank president, Phyllis Campbell, will assume the role of its new chairman. Campbell’s connection to the philanthropic community is legendary around the Puget Sound, especially in her latest position as CEO of the Seattle Foundation. She also currently serves as chair of the board for Seattle University, an Independent Colleges of Washington member.

There’s a story about Campbell’s appointment on the Seattle Times blog.

Phyllis’ unique perspective from both sides of the table will make her an important leader in these challenging times as we look for ways to keep our banking industry solvent and our community responsive to the growing unemployment, healthcare and other basic services concerns facing so many families who live in our region. She is a good choice to help us navigate some rough waters ahead.

The question of whether the stimulus package will work has been hotly debated.  FactCheck.org has a tally going.  The weekend reports that Republican Governors are considering not taking the money because they don’t agree with it philosophically may answer the question.    If some states use the stimulus and others don’t we may have created a real world test about the impact — or lack thereof.  That would be good to know.  However, if the stimulus package works and some states are excluded because of the decisions of their elected leaders, one has to be concerned about their citizens.  It likely won’t be the wealthy in the state that are left behind, but the people missing payments of extended unemployment payments and the like.  That kind of real world experimentation isn’t something we should hope for.

In times of recent financial crisis’ in our country, non-profits have usually experienced a surge in giving, especially for those that provide basic services of food, shelter and clothing. It seems that people knew and understood that help was needed to get through times of great stress and economic downturns. This time, however, it feels different.

A recent article in the Chronicle of Philanthropy (January 15, 2009) suggests that extra or emergency incentives are needed at this time to entice more people to give. Some of the solutions mentioned in the article have been discussed many times before, such as letting people who do not itemize their tax deductions claim a deduction for charitable giving.

Other more creative ideas discussed in the article include expanding service programs like AmeriCorp that can mobilize mass numbers of unemployed college graduates and others who have been laid off from some of the hardest hit professions into those NPO’s that provide basic services in communities throughout the country, including teaching. While others include temporarily relieving individuals and foundations of tax burdens when giving more to charities (in particular those that specifically help with the economic recovery) and raising the mileage deduction rate for travel expenses for non profit volunteers.

Unusual times require unusual solutions.

The Bill and Melinda Gates Foundation announced earlier this month that they will actually increase their support to the charitable interests they fund in 2009, despite the huge losses in the foundation’s assets this past fiscal year. In fact, they are encouraging everyone – corporations, foundations and individuals to continue their support of local and other non profit organizations despite the grim economic news. They recognize that the need in our own community and across our country is greater now than it has ever been in most of our lifetimes. In other words, we need to help each other.

Thanks to our very loyal and generous donors, ICW is experiencing very little downturn in giving so far this year. Many of our corporate and foundation supporters have followed the call of the Gates Foundation and have actually increased the size of their gifts for student scholarships so far this year. In fact we’ve had more increase in gift size than from those companies or foundations who have declined our request for support. Our donors understand that education is the best investment our community can make. An educated workforce is one of the best ‘stimulus packages’ to help rebuild and stabilize our slumping economy which is not an easy task. In the words of our new President, “there is nothing so satisfying to the spirit, so defining of our character, than giving our all to a difficult task.”

Our ICW students and colleges are preparing themselves right now for this important challenge that lies ahead.

ICW Board member DeLona Lang Bell wrote this op-ed which appeared in the Walla Walla Union-Bulletin January 27.

Independent Colleges of Washington has started a blog! Check here for regular updates on state and national developments in higher education. Don’t forget to check out our homepage www.icwashington.org and our college application guide www.projectopportunity.net.

Presidents of ICW member colleges recently sent a letter to the governor and legislature urging them to protect higher education and financial aid funding to help bolster the sagging economy. The Seattle Times ran a version of the letter as an op-ed piece Dec. 1.