David Hecker
President

Lois Lofton Doniver Secretary-Treasurer

Louise Somalski
Legislative Coordinator

August, 2007

Links to current Advocacy Campaigns
may be found in the Legislative Action Center

House Passes Education Budgets
2007- 2008 School Aid Budget
2007 - 2008 Department of Education Budget (HB 4346)
2007- 2008 Higher Education Budget (HB 4350 and HB 4351)
FY 2007 - 2008 Community Colleges Budget (HB 4360)

ESTIMATED Impact of K-12 Proposals [.pdf 40k]

House Passes Education Budgets

In a House session that lasted from 1:30 p.m. Wednesday, August 22 until just after 6:00 a.m. Thursday, August 23, the chamber finally completed its version of the education budget bills.

Just before sunrise on Thursday, HB 4360, HB 4350, HB 4351, HB 4359 and HB 4346 were sent to the Senate. However, Republicans gave notice that they want the vote on the Community Colleges Budget (HB 4360) reconsidered when the chamber reconvenes Wednesday, August 29.

Included in the budgets is a 5 percent increase in higher education funding, though the state's three largest universities would be paid under a separate bill, and the 28 community colleges would get a 2.5 percent hike coupled with additional money for nursing programs. Both Community Colleges and Higher Education would receive money owed them from last year's budget.

The School Aid Budget will see an increase in the per-pupil foundation grant of $100, with many districts receiving a $100 equity payment. Those districts with declining enrollment would see some help and those with more than 156 square miles would get a $98 per-pupil boost.

It is becoming clear to many that cuts and reforms alone cannot support adequate budgets without enacting a tax increase. There is talk of an income tax increase to 4 percent or more, a sales tax on services and entertainment of 6 percent, along with increases in the liquor tax and the like. As of today, no legislative agreement has been reached. Continue to contact your legislators restating your support for mor revenues.

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2007- 2008 School Aid Budget

This School Aid Budget (HB 4359), totals $13.3 billion, of which only $35 million is paid for with general funds. It would increase per pupil funding for the state's school districts by $100 per pupil in the coming year, an increase of 1.4 percent. The bill would roll up last year's equity payment of $23 per pupil into each qualifying district's base foundation. The House also increased equity payments and declining enrollment payments.

House Passed School Aid Highlights:

Basic Foundation Allowance (Sec. 20 (1) & 22b): Increases the basic per-pupil foundation allowance by $100 plus the $23 equity payment from FY 2006-07, bringing it to $7,208 for FY 2007-08.

Equity Payment (Sec. 22c): Increases to $113.5 million for equity payments of up to $100 per pupil for districts with a FY 2007-08 foundation of $7,669 or less.

Declining Enrollment (Sec. 29): Increase to $36 million for declining enrollment grants to local districts (not including charters) with two years of consecutive pupil membership decline. The payment would equal the district's 3-year pupil membership average minus the actual pupil membership times the district's foundation allowance. If insufficient funds are available the funding will be prorated.

Transportation Grants - NEW (Sec. 77): Appropriates $20 million for qualified districts for costs associated with transporting pupils to and from school. Allocates $15 million to districts with total square miles greater than 156 and $5 million to districts with fewer than 5 pupils per square mile. Payments for each would equal around $98 per pupil.

Adult Education Program (Sec. 107): Retains distribution to 90% for enrollment and 10% for completion.

MPSERS Contribution Subsidy (Sec. 147): Allows the rate charged to districts to decline from 17.74% of payroll in FY 2006- 07 to 16.72% in FY 2007-08 due to revaluation of system.

Early Childhood Education - NEW (Sec. 32): Provides intent that by 2011-2012, all districts will provide universal full-day preschool for 4-year-olds. Also provides intent that at least 11% of the total appropriation spent on 4-year-old preschool programs be appropriated for 0-3 and 0-5 early childhood programs.

Universal Pre-School 4-year-old program - NEW (Sec. 32f): Creates a new universal full-day preschool program for any district funded with a foundation allowance for up to 11,000 children at a cost of $43.7 million. Assumes programs won't start until second half of the school year.

Intermediate District (ISD) Parent Involvement Grants (Sec. 32j): Increases gross funding by $22.5 million to $27.5 million. Maintains $5.0 million for the 0-5 parent involvement grants run by ISDs. Adds $22.5 million for comprehensive services grants for children, from age 0 through three years of age, and their families.

Great Start Communities Grants (Sec. 32b): Increases funding by $1.5 million to $2.5 million for competitive grants awarded to eligible ISDs in amounts determined by the Early Childhood Investment Corporation (ECIC).

0-3 Secondary Prevention Early Childhood Grants (Sec. 32c): Increases funding by $750,000 to $2.5 million for interagency early childhood grants.

School Readiness Program - District Grants (Sec. 32d): Increases funding by $4.6 million to $83.4 million. The additional funding increases the per-child allocation from $3,300 to $3,500.

Readiness Program - Full-Day Grants - NEW(Sec. 32e): Provides for up to 11,000 children at a cost of $43.7 million. Assumes programs won't start until second half of the school year.

School Readiness Program - Competitive Grants (Sec. 32L): Increases funding by $800,000 to $13.1 million. The additional funding increases the per-child allocation from $3,300 to $3,500.

Intermediate School Districts General Operations (Sec. 81): Provides no increase.

Consolidation of Business, Administrative, and Instructional Services: Not included.

MEAP Assessment Testing Costs: Increase funding by $10.7 million for costs associated with elementary and high school assessments required under State and Federal law.

Health/Science Middle College Program (Sec. 64): Includes an increase of $2.0 million for a total of $4.0 million in grant funding for ISDs or Detroit Public Schools that are in consortium with a community college or state university and a hospital to create a middle college focused on health sciences. Limits the grant to four years with recipients receiving 100% of their prior year grant amount for the second year, and 50% of their prior year grant amount for each year after. Allows for current grant recipients to apply for another grant.

Amer-I-Can Grants - NEW (Sec. 31g): Includes two new grants for the Amer-I-Can training curriculum in life-management skills, designed to raise self-esteem and teach students how to empower themselves. Grants to Detroit for $1.5 million and Grand Rapids for $500,000.

Post Secondary Education Attainment - NEW (Sec. 65a): Includes new grant of $500,000 to Macomb ISD for the purpose of establishing a pilot program to facilitate access by students of all ages to information regarding post secondary opportunities.

Child and Adolescent Health Centers: Increases funding by $2 million to $5.7 million for additional Adolescent Health Centers.

Other Categorical Grants: Maintains funding Automatic External Defibrillators grant (Sec. 99a) and Mercy Education Project (Sec. 31a(17)) at $100,000 each. Appropriates $100,000 Wayne State University for the SEMAA (science, engineering, mathematics, aerospace academy) (Sec. 99i).

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2007 - 2008 Department of Education Budget (HB 4346)

The House passed 2007 - 2008 Department of Education Budget includes a gross appropriation of $97.8 million. This represents a funding increase of $7.2 million, or 8 percent over the current fiscal year. However, much of the overall rise ($4.2 million) in the appropriation comes from the transfer of Career and Technical Education Operations from the Department of Labor and Economic Development.

Key changes outlined in the bill include:

Professional Preparation Services: ASSUMES an additional $1,558,400 from a proposed increase in teacher certification fees and new teacher college review fees (HB 4591, which has not yet passed the Senate), as well as a one time addition of $200,000 available from the carry forward of teacher testing fees. Of that, $904,400 would fund the upgrade and conversion of the teacher licensing database, $54,000 would reimburse the Department for reviewing teacher college programs.

Teacher Preparation Programs (Sec. 503): It also includes $100,000 to maintain the alternative teacher certification programs at Central Michigan University and Wayne State University and adds a report requirement including number of teachers certified, time served in the classroom, and teacher evaluations.

School Employee Salary and Benefit Study (Sec. 222): Includes $150,000 in the state board/superintendent operations line for a study to compare Michigan school employee salaries and benefits, focusing on school administrators, to those in peer states and with the private sector.

Consolidation - New (Sec. 801): Includes $300,000 and two positions in School Finance and School Law operations to support the Department's effort to study, encourage and determine the impact of consolidation.

Early Childhood Education: Includes $400,000 and four positions to support the new early childhood programming included in the School Aid Budget.

Special Education Operations (Sec. 350): Adds $80,000 to this line item so the Department can make Newsline, a news service for those with disabilities, electronically available statewide.

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2007- 2008 Higher Education Budget (HB 4350 and HB 4351)

The House retains the Governor's proposal to move funding for Michigan State University (including the Agricultural Experiment Station and Cooperative Extension), University of Michigan - Ann Arbor, and Wayne State University into a separate Research Universities bill (HB 4351). Funding for the other 12 state universities, financial aid, and other programs would remain in the Higher Education bill (HB 4350).

Major changes from FY 2006-07 enacted appropriations are listed below.

State University Operations: 2.5% Across-the-Board: Increases operations line items for all fifteen Michigan universities by 2.5% across the board.

State University Operations: 2.5% Formula-Based: Includes additional 2.5% university operations increase for Michigan State, UM-Ann Arbor, and Wayne State based on three formula components:

• Participation (25.0%): Allocated based on percentage of undergraduate students receiving Pell Grants.
• Research (25.0%): Allocated based on amount of federally funded research expenditures.
• Degree Completion (50.0%): Allocated based on number of weighted degree completions (higher weight for degree completions in math/science/engineering/health areas).

State University Operations: 2.5% Formula-Based: Includes additional 2.5% university operations increase for the 12 remaining universities based on three formula components:

• Participation (35.0%): Allocated based on percentage of undergraduate students receiving Pell Grants.
• Research (15.0%): Allocated based on amount of federally funded research expenditures.
• Degree Completion (50.0%): Allocated based on number of weighted degree completions (higher weight for degree completions in math/science/engineering/health areas).

FY 2006-07 University Funding Restoration: Includes funds to be paid to all fifteen Michigan universities in October of 2007, offsetting delayed August 2007 payments under EO 2007-3 and Senate Bill 436.

Admission of Michigan High School Graduates (Sec. 311/464): Both bills contain language requiring the all 15 schools admit the Michigan students who graduate at the top 10 percent of their class and who meet all other criteria outlined by the school for admission.

Foreign Auto Manufacturers - NEW (Sec. 210/210): Prohibits use of funds appropriated to all state universities for purchase/lease of a vehicle produced by a foreign auto manufacturer.

University Research Corridor - NEW (Sec. 209): Provides for appropriation to legal entity to be jointly formed by Michigan State, UM-Ann Arbor, and Wayne State to encourage collaborative efforts between those universities, establish research partnerships with businesses, and publicize the research assets of the universities to businesses in other states; requires report on organization's efforts.

Consolidation of Services - NEW (Sec. 506): States intent that state universities included in Research Universities bill consolidate programs, services, and resources among themselves and requires report on such efforts.

Students from Eligible County - NEW (Sec. 507): Requires report from state universities included in Research Universities bill regarding outreach efforts to enroll students from an eligible county; Macomb County would qualify as an eligible county under the language.

State Competitive Scholarships: Reduces $3.0 million appropriation from Michigan Higher Education Assistance Authority Operating Fund to projected available amount of $1.2 million, offsetting the remaining $1.8 million with GF/GP revenue.

Tuition Grant Program (Sec. 302): Maintains line item at current-year level ($2.9 million GF/GP increase needed to offset one-time carry-forward funds appropriated in FY 2006-07).

Michigan Merit Award and Promise Grant Programs: Reduces the Merit Award line item by $67.7 million and adds $43.5 million appropriation for the new Michigan Promise Grant program that takes effect with high school class of 2007. The net impact is a reduction of $24.2 million in appropriations from the Merit Award Trust Fund, reflecting the lower award amount over the first two years of college under the new program. Costs of the $2,000/$4,000 awards paid after completion of two years of postsecondary education under the Promise Grant Program will begin in FY 2009-10.

Tuition Incentive Program (TIP)(Sec. 310): Increases TIP appropriation for projected cost increase. Program provides financial aid to Medicaid-eligible students who graduate from high school. FY 2006-07 appropriation has subsequently been increased by $4.0 million through a legislative transfer, so net proposed increase for FY 2007-08 is $3.1 million. Adds requirement that recipients not be enrolled in an institution whose primary purpose is to prepare students for religious ordination, consistent with other state financial aid programs.

Tuition and Financial Aid Increases (Sec. 302/436): Retains statement of intent that state universities increase their general fund expenditures for institutional financial aid by at least the same percentage as their resident undergraduate tuition/fee rates. Adds new subsection stating intent that universities utilize a portion of their FY 2007-08 funding increases to provide students savings through rebates, tuition/fee reductions, and/or financial aid awards; requires report on amount/ method of student savings.

Universities represented by AFT Michigan would receive the following appropriations:

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FY 2007 - 2008 Community Colleges Budget (HB 4360)

The 2007 - 2008 Community Colleges Budget, as passed by the House, totals $333.8 million, all of which is paid for with general fund monies. The appropriation represents a $44 million, 15.2 percent, hike above current year spending for the state's 28 community colleges. However, $25.8 million of that increase is the reimbursement for the delayed payments to the colleges withheld in the current fiscal year.

House Republicans requested reconsideration of the Community Colleges Budget (HB 4360) when the chamber reconvenes Wednesday, August 29, 2007. It is unlikely they will have enough votes to change the bill.

The FY 2007-2008 Community Colleges Budget contained in HB 4360 include the following:

Operations Funding: Includes $7.1 million (a 2.5 percent increase) operational increase distributed according to the Task Force formula.

Parity with Higher Education: Includes $3.2 million to address parity with Higher Education spending increases in FY 2005-2006, distributed across-the-board in proportion to FY 2005-2006 appropriations. (With parity funding and other adjustments included, the range of increases above current year appropriations is 3.26 percent to 9.55 percent.)

Wayne County Community College: Includes $225,000 to Wayne County Community College to complete the restoration of the $450,000 reduction made in FY 2003-2004, which was allocated to three other colleges that year.

Restoration Payment: Restores $26 million in cuts made last year (one-half by executive order, one half by legislation).

At-Risk Student Success Program (Sec. 401 - renumbered Sec. 303): Modifies language and requires that equipment or information technology hardware or software purchased using at-risk funds must be associated with the operation of a program designed to address the needs of at-risk students.

Nursing Program Grants: Includes $7 million in funding for nursing program grants. Up to half of the funding is to be distributed to colleges based on the number of new nursing students in 2007- 2008 compared to 2006-2007. Colleges would receive $2,000 for each eligible newly enrolled nursing student. The remainder of the funding would be distributed to colleges for existing nursing programs based on nursing AND/RN awards in FY 2005-2006.

Abortion Services: DELETES language prohibiting use of state funds by colleges for provision of health care coverage to employees or their dependents for abortion services, with certain exceptions.

Benefits to Unmarried Partners: DELETES language stating legislative intent that colleges not extend employee benefits to unmarried partners of employees, except for pre- and post-natal costs.

Under House Bill 4360 community colleges represented by AFT Michigan would see the following percent funding increases:

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