The “caboose” budget bill for the current biennium (HB 29/SB 29) and the budget bill for the upcoming 2010-2012 biennium (HB 30/SB 30) were adopted on Sunday, March 14 after the General Assembly adopted a procedural resolution, HJR 494, allowing them to extend their session by one day. The extended time was caused by differences between the House and Senate budget conferees over raising fees of certain fees and the overall $4 billion difference between revenues and projected expenses compared to the budget that had been introduced by former Governor Tim Kaine.

The budget for the current fiscal year contains one furlough day for state employees.  Institutions of higher education have the flexibility to  explore other options for savings instead of the furlough day.  The biennial budget totals $82 billion and contains an$1 billion decrease in health and human services funding,  a $646 million decrease in funding for K-12 education, and an infusion of $620 million from the Virginia Retirement System.

One area of the budget never cut previously but which received a reduction in the biennium is tuition assistance grants for students attending Virginia’s private colleges and universities; this program will be reduced $10 million over the biennium. 

In this environment of declining revenue, the Virginia Community College System (which had already sustained  $65 million in net reductions since the first wave of budget cuts in FY 08)  was very pleased that the overall budget recommendations were favorable for community college students and their role in the state’s economic recovery. Two recommendations that had been advanced by the House or Senate were not contained in the final conference report.

1. The first recommendation was a change to the state’s financial aid formula that would have disproportionately harmed community college students by disallowing living expenses in the calculation of need for students living with their parents and eliminated the allowance for travel costs.  For the 2009/2010 academic year, the average total family income for VCCS students receiving financial aid was $41,946; to remove living expenses from the need analysis for these students would have collectively reduced their financial need by $55.4 million or $3,109 per student. 
2. The second recommendation that was not approved was a $2.50 per credit hour fee for capital projects for in-state students.  Because the VCCS serves over 58% of the undergraduate students enrolled in Virginia public institutions, the VCCS would have produced a large portion of the revenue from this fee–over $7.7 million of the $18.2 million for all of the fees generated by higher education (42% of the total) which was not reflective of the share of the VCCS of capital outlay funding from the state.  This would have placed a large burden on community college students and would have represented a 2.5% increase to tuition and required fees versus a 1% increase for the four year institutions. 

Although the final budget contained a reduction from former Governor Kaine’s introduced budget for community college transfer grants, there should be adequate funding remaining to sustain the estimated pool of eligible students. 

It was a very interesting General Assembly session. Despite the challenging economic environment, innovataive legislation was introduced to allow community colleges to begin offering baccalaureate degrees in high-demand areas and for the state to match community college fundraising efforts with a state match of up to $5 million; although these bills were not successful, the profile of Virginia’s community colleges was raised and these issues will be advanced again in future General Assembly sessions. One new initiative for the Virginia Community College System will be the development of a uniform general studies certificate to be offered at each of the 23 community colleges which will allow seamless transfer of the one-year certificate’s credits to any four-year public institution in Virginia.

Posted by Ellen Davenport