Brief⁽¹⁾

S.B. 345 would create the Kansas Higher Education Coordination Act. The bill would make statutory changes to the State Board of Regents; provide for the Board's supervision of postsecondary institutions and programs currently under the State Board of Education; create a higher education coordinating role for the Board of Regents; implement performance funding for public postsecondary institutions; change the funding mechanisms for community colleges and Washburn University; and provide for Regents faculty salary increases.

Specifically, the bill would provide for the supervision by the State Board of Regents of community colleges, area vocational schools, and technical colleges. No change would be made to the Board's existing governance of the Regents institutions. The administration of adult basic education and adult supplementary education programs and the regulation of proprietary schools also would be transferred from the State Board of Education to the State Board of Regents. The bill would make the Board of Regents responsible for the coordination of postsecondary education, including Washburn University and the independent colleges and universities.

In addition, the bill would make the Board of Regents responsible for identifying core performance indicators that would serve as the basis for performance funding, which would begin July 1, 2002.

Major features of the bill are as follows:

• Existing Board of Regents Would Be Abolished and New Board Created. Upon publication of S.B. 345, as amended, in the Kansas Register, the current Board of Regents and the position of Executive Director of the Board would be abolished. There would be a wind-down period until June 30, 1999, and on July 1, 1999, the new Board of Regents created by the bill would become operational.



• Nine-Member Board of Regents Would Be Established. S.B. 345, as amended, would create a nine-member Board of Regents appointed by the Governor and confirmed by the Senate. After the initial appointment that would establish staggered terms, members would serve four-year terms, with a two-term limit. As currently is the case, one member of the Board of Regents would be a resident of each congressional district and the remaining members would be appointed at large, except that no two members could be from the same county. No more than five members could be from the same political party. The Governor would designate the first chairperson of the new Board, but after that the members would elect the chair. Members of the new Board of Regents would be appointed on or before July 1, 1999.



• New Board Would Have Responsibilities to Govern, Supervise, and Coordinate. There would be no change in the new Board's authority to govern (manage and control) the Regents institutions. Governance of the community colleges, area vocational schools, and technical colleges would continue to reside with local boards of trustees for the community colleges and local school district boards, boards of trustees, or multi-boards of control for the area vocational schools and technical colleges. Washburn University would continue to be governed by the Washburn University Board of Regents. Supervision of the community colleges, area vocational schools, and technical colleges would be transferred from the State Board of Education to the State Board of Regents. The responsibility to administer adult basic education and adult supplementary education programs and to license proprietary schools also would be transferred from the State Board of Education to the Board of Regents. Coordination between and among institutions and institutional sectors, including Washburn University and the independent colleges and universities, would be exercised by the Board of Regents.



• Duties of the Board of Regents. The Board would be charged with the following specific duties:



• adopt and administer a comprehensive plan for coordination of higher education;



• determine institutional roles and review institutional missions and goals;



• develop articulation procedures among and between postsecondary institutions;



• approve or disapprove for state funding purposes existing and proposed educational programs, courses of instruction, and program and course locations;



• review budget requests and present a unified budget for higher education to the Governor and to the Legislature each year;



• approve core indicators of quality performance for postsecondary educational institutions;



• resolve conflicts among and between postsecondary educational institutions;



• develop and implement a comprehensive plan for the utilization of distance learning technologies;



• develop each year and recommend to the Governor and the Legislature a policy agenda for higher education that assesses priorities among proposals for policy change, programmatic recommendations, and state funding requests;



• conduct continuous studies of ways to maximize the utilization of higher education resources and of how to improve access to postsecondary education;

• receive and consider reports, proposals, and recommendations of commissions that are advisory to the Board and take such actions thereon as are deemed necessary and appropriate; and



• make annual reports on its functions and duties to the Governor and the Legislature.





• Advisory Commissions Would Be Established. The Board of Regents would be subdivided into three advisory commissions--one for community colleges, area vocational schools, and technical colleges; one for Regents institutions; and one for higher education coordination. At the time the Governor appoints each member to the Board of Regents, the Governor would designate the advisory commission on which the member is to serve. Each advisory commission would have three members and each member of the Board of Regents would serve on one of the commissions. After July 1, 2002, only one representative of any one postsecondary educational institution could serve on a commission. "Representative of a postsecondary educational institution" would be defined to mean someone who holds an associate degree, a bachelor's degree, or a certificate of completion from a postsecondary institution.



• Duties of the Commission for Community Colleges and Vocational/Technical Education. The Commission for Community Colleges and Vocational/Technical Education would have the following duties:



• propose for adoption by the State Board rules and regulations for supervision of the community colleges, technical colleges, and area vocational schools;



• initiate plans for institutional advancement and new educational programs and courses of instruction;



• provide for statewide planning for community colleges, technical colleges, and area vocational schools;

• review existing and proposed educational programs, courses of instruction, and program and course locations and make recommendations to the State Board with respect to the approval or disapproval of such programs, courses, and locations;



• review requests of community colleges, technical colleges, and area vocational schools for state funding and formulate recommendations thereon;



• identify core indicators of quality performance for community colleges, technical colleges, and area vocational schools;



• develop an annual policy agenda for community colleges, technical colleges, and area vocational schools;



• conduct continuous studies and make recommendations concerning ways to best use resources available for institutions under its jurisdiction; and



• make reports on the performance of its functions and duties together with any proposals and recommendations at each regular meeting of the Board of Regents.





• Duties of the Commission for Public Universities. The Commission for Public Universities would have the following duties:



• propose rules and regulations to the Board of Regents concerning the operation and management of the Regents institutions;



• initiate plans for institutional advancement and new educational programs and courses of instruction;



• formulate budget requests for the Regents institutions;



• make recommendations to the Board with respect to the appointment of chief executive officers of the Regents institutions;



• review existing educational programs and courses of instruction at the Regents institutions and make decisions with respect to the educational and economic justification for the programs and courses;



• develop an annual policy agenda for the Regents institutions;



• conduct continuous studies of ways to best use resources available for Regents institutions;



• make reports on the performance of its functions and duties together with any proposals and recommendations at each regular meeting of the Board of Regents; and



• identify core indicators of quality performance for Regents institutions.





• Duties of the Commission for Higher Education Coordination. The Commission for Higher Education Coordination would have the following duties:



• conduct continuous review and evaluation of the comprehensive plan for coordination of higher education and make recommendations for amendment, revision, or modification of the plan;



• review existing and proposed educational programs, courses of instruction, and program and course locations and make recommendations to the Board with respect to the coordination of programs, courses, and locations;



• collect and analyze data and maintain a uniform postsecondary education database;



• formulate recommendations for the resolution of conflicts among and between postsecondary educational sectors and institutions;

• compile core indicators of quality performance for all of the postsecondary educational institutions under the Board's jurisdiction;



• broker affiliations and mergers of postsecondary educational institutions;



• coordinate with Washburn University and the private colleges and universities in developing a state system of higher education;



• formulate budget requests for state student assistance programs; and



• make reports on the performance of its functions and duties together with any proposals and recommendations at each regular meeting of the State Board of Regents.





• New Board Would Assume Duties of Former Board of Regents and State Board of Education With Respect to Transferred Institutions. Transfer language would make the newly-established Board of Regents the successor board to the current Board and provide for the transfer of supervisory authority for the community colleges, area vocational schools, and technical colleges from the State Board of Education to the State Board of Regents. These provisions address the transfer of current employees of the Board of Regents and the State Board of Education to the new Board of Regents if the new Board determines that the officers and employees are necessary to perform the new Board's powers, duties, and functions.



• Performance Funding Would Be Implemented. Beginning in FY 2003, the Legislature would appropriate funding to the State Board of Regents to be allocated to postsecondary educational institutions, including Washburn University, on the basis of performance. The Board would make allocations to each postsecondary institution on the basis of each institution's attainment of success and excellence on indicators that have been selected and approved by the Board. Each institution would be eligible to receive additional funding of up to 2 percent of its State General Fund appropriation for the prior year. (For area vocational schools and technical colleges, the award would be based on total funding for the postsecondary state aid program the prior year.)





• Community College State Aid Programs Would Be Replaced With An Operating Grant. Beginning in FY 2001, community college funding would be on the basis of operating grants equal to 50 percent of the state aid per student for a full-time equivalent (FTE) lower-division student at the regional Regents institutions (Emporia, Fort Hays, and Pittsburg state universities) multiplied by the higher of the community college's FTE enrollment in the current or prior year. The credit hour, out-district, and general state aid programs would be eliminated. A hold-harmless provision would ensure that no community college gets less in FY 2001 than in FY 2000. For fiscal years 2002 through 2004, operating grants would increase by 5 percentage points each year until the grants equal 65 percent of the state aid per student for an FTE lower-division student at the regional Regents institutions multiplied by the higher of the community college's FTE enrollment the current or prior year.



• Community College Mill Levies Would Be Reduced. Beginning in FY 2001 when the grant is implemented, community colleges would have to use at least 80 percent of increased state aid over the prior year to reduce their mill levies. The remaining portion of the increase either could be used for program enrichment or to further reduce mill levies.



• County Out-District Tuition Would Be Eliminated. Beginning in FY 2001, county out-district tuition would be phased out in even increments over a four-year period ending in FY 2004: In FY 2001 the counties would pay $18 per credit hour; in FY 2002 they would pay $12; and in FY 2003 they would pay $6. The revenue lost to community colleges from county out-district tuition would be replaced by state aid and would be included within the operating grant for each community college.

• Washburn University's Operating Grant Would Be Changed. The basis for the Washburn University operating grant would be the same as that for community colleges and would be 50 percent of the state aid per student for an FTE lower-division student at the regional Regents institutions multiplied by the higher of the University's enrollment in the current or prior year. A hold-harmless provision would ensure that the University would not get less money in FY 2001 than in FY 2000. The percentage would increase to 55 percent in FY 2002, 60 percent in FY 2003, and 65 percent in FY 2004. Out-district tuition paid by counties other than Shawnee and by townships in Shawnee County outside the City of Topeka would be phased out beginning in FY 2001 and ending in FY 2004 and would be replaced by state aid as part of the operating grant.



• Regents Faculty Salaries Would Increase. Upon the conversion of community college funding to an operating grant, whatever the dollar amount of the percentage increase for the community colleges (excluding state aid replacement for county out-district tuition), the same amount of dollars would be made available to Regents institutions for faculty salary enhancements over and above normal operating budget increases. This enhancement would end in FY 2004 when the community college operating grant is fully phased in.



• Legislative Educational Planning Committee Would Monitor Act. The implementation and operation of the Kansas Higher Education Coordination Act would be monitored by the Legislative Educational Planning Committee, which would make an annual report concerning the Act to the Legislature and to the Governor. The report could include recommendations and proposed legislation to amend the Act.

Background

The original version of S.B. 345 made changes to the Kansas Board of Regents and affected the structure and coordination of postsecondary education. A performance funding component affecting all public postsecondary institutions was added to the bill, as passed by the Senate.

The structural changes proposed in S.B. 345, in its present form, would not require a constitutional amendment, nor would the changes affect existing authority of the Board of Regents over the institutions it governs. The Board's authority to administer state student assistance programs, which affect students at area vocational schools, community colleges, Regents institutions, and independent colleges and universities, would not be affected. Also unaffected would be the powers and duties of community college boards of trustees and local governing boards for the technical colleges and area vocational schools.

The main change made by the House Education Committee was to add a funding component to the bill which would change the way community colleges and Washburn University are funded and provide for Regents faculty salary increases. In addition to the funding component, other changes made to the Senate-passed version of the bill by the House Committee are the following:

• The Commission for Higher Education Coordination would be given the duty to formulate budget requests for state student assistance programs.



• The Senate version would cap performance funding at 2.5 percent for each institution, compared to 2.0 percent in the House version, and would make one appropriation to the Board of Regents for Regents institutions and Washburn University, one for community colleges, and one for technical colleges and area vocational schools. Under the House Education Committee version, all performance funding would be in a single appropriation to the Board. The Senate version would require institutions to revise institutional improvement plans at least every three years. Under both versions, performance funding would begin in FY 2003.

According to the fiscal note prepared by the Division of the Budget, the immediate fiscal impact of S.B. 345 would be that all funding for the existing Board of Regents and the Board's 18.0 FTE positions would be transferred to the new Board. In addition, all funding for those institutions and programs that would be transferred from the State Board of Education to the new Board of Regents would be transferred from one board to the other, along with salaries for 11.0 FTE positions. However, it has not been calculated what the fiscal impact would be of new responsibilities given to the Board of Regents. The amount of money available for performance funding would be subject to appropriation and would not begin until FY 2003.

The amendments made by the House Committee would increase funding for the community colleges, Washburn University, and Regents institutions over a several-year period. The table below shows estimated increases over the prior year for each sector for the implementation years of the program (FY 2001 through FY 2004), excluding performance funding.

• Publication in the Kansas Register--S.B. 345, as amended, would become effective. The existing Board of Regents would be abolished, but would continue to function in a wind-down mode until June 30, 1999.



• July 1, 1999--The new Board of Regents would become operational and all powers, duties, and functions exercised by the former board would be transferred. By this date, appointments to the new board would be made and supervisory authority for the community colleges, area vocational schools, and technical colleges would be transferred from the State Board of Education to the new board, as would the regulatory authority to license proprietary schools and administrative authority over adult basic and adult supplemental education programs.

• July 1, 2001-Community college and Washburn University funding would be on the basis of operating grants equal to 50 percent of the state aid per student for FTE lower-division students at the regional Regents institutions. County out-district tuition would begin to phase out. Regents institutions would get an enhanced amount of funding for faculty salaries based on an increase in funding for community colleges. Performance indicators would be established by the Board of Regents for all postsecondary institutions under the Board for the purpose of performance funding.



• July 1, 2002-Operating grants for community colleges and Washburn University would increase to 55 percent. Performance funding would begin, with an appropriation made to the Board of Regents. The Board would allocate funds to each postsecondary institution on the basis of each institution's attainment of excellence on its indicators. Each institution would be eligible to receive additional funding of up to 2 percent of its State General Fund appropriation for the prior year. (For area vocational schools and technical colleges, the award would be based on total funding for the postsecondary state aid program the prior year.) Regents faculty salary enhancements would continue.



• July 1, 2003-Operating grants for community colleges and Washburn University would increase to 60 percent. The phase-out of county out-district tuition and Regents faculty salary increases would continue.



• July 1, 2004-Operating grants for community colleges and Washburn University would increase to 65 percent, completing the phase-in of the operating grant. This also would be the last year of the phase-out of county out-district tuition and Regents faculty salary increases under the proposed plan. Performance grants would continue.

The House Committee of the Whole amended the bill to delay implementation of the operating grant from FY 2000 to FY 2001. Another amendment would hold Cloud County Community College harmless in FY 2001 when the operating grant is scheduled to begin. (Cloud County Community College was the only community college that would have lost money in FY 2001 compared to FY 2000.)

1. *Supplemental notes are prepared by the Legislative Research Department and do not express legislative intent. The supplemental note and fiscal note for this bill may be accessed on the Internet at http://www.ink.org/public/legislative/bill_search.html