HOUSE BILL No. 4298

February 18, 1999, Introduced by Reps. Stamas, Godchaux, Jelinek, Pappageorge, Mead, Jellema, Toy, Kukuk, Caul, Byl, Geiger, Jansen and Scranton and referred to the Committee on Appropriations.

EXECUTIVE BUDGET BILL

A bill to make appropriations for community colleges for the fiscal year ending September 30, 2000; to provide for the expenditure of the appropriations; to establish or continue certain funds, programs, and categories; and to prescribe the powers and duties of certain state departments, officers, and employees.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

PART 1

LINE ITEM APPROPRIATIONS

Sec. 101. Subject to the conditions set forth in this bill, the amounts listed in this part are appropriated for community colleges and certain other state purposes relating to education for the fiscal year ending September 30, 2000, from the funds indicated in this part. The following is a summary of the appropriations in this part:

COMMUNITY COLLEGES

APPROPRIATION SUMMARY:

GROSS APPROPRIATION $ 292,962,019

Interdepartmental grants:

Total interdepartmental grants and

intradepartmental transfers 0

ADJUSTED GROSS APPROPRIATION $ 292,962,019

Federal revenues:

Total federal revenues 0

Special revenue funds:

Total local revenues 0

Total private revenues 0

Total other state restricted revenues 0

State general fund/general purpose $ 292,962,019

Sec. 102. OPERATIONS

Alpena Community College $ 4,703,837

Bay de Noc Community College 4,400,400

Delta College 13,488,310

Glen Oaks Community College 2,094,673

Gogebic Community College 4,058,527

Grand Rapids Community College 17,599,052

Henry Ford Community College 20,179,700

Jackson Community College 11,757,634

Kalamazoo Valley Community College 10,657,339

Kellogg Community College 8,703,721

Kirtland Community College 2,884,295

Lake Michigan College 4,723,720

Lansing Community College 29,118,666

Macomb Community College 31,757,884

Mid Michigan Community College 3,903,610

Monroe County Community College 3,815,205

Montcalm Community College 2,994,561

C.S. Mott Community College 14,894,333

Muskegon Community College 8,418,834

North Central Michigan College 2,821,668

Northwestern Michigan College 8,312,144

Oakland Community College 20,484,101

St. Clair County Community College 6,618,824

Schoolcraft College 11,338,620

Southwestern Michigan College 5,646,316

Washtenaw Community College 10,994,801

Wayne County Community College 16,267,643

West Shore Community College 2,170,577

GROSS APPROPRIATION $ 284,808,995

Appropriated from:

State general fund/general purpose $ 284,808,995

Sec. 103. GRANTS

At-risk student success program $ 3,584,566

Tuition restraint incentive grants 4,200,000

Renaissance zone tax reimbursement funding 368,458

GROSS APPROPRIATION $ 8,153,024

Appropriated from:

State general fund/general purpose $ 8,153,024

PART 2

PROVISIONS CONCERNING APPROPRIATIONS

GENERAL SECTIONS

Sec. 201. (1) Pursuant to section 30 of article IX of the state constitution of 1963, total state spending from state sources for fiscal year 1999-2000 is estimated at $292,962,019.00 in this bill and state spending from state sources paid to local units of government for fiscal year 1999-2000 is estimated at $292,962,019.00.

(2) If it appears to the principal executive officer of a department or branch that state spending to local units of government will be less than the amount that was projected to be expended under subsection (1), the principal executive officer shall immediately give notice of the approximate shortfall to the state budget director.

Sec. 202. The expenditures and funding sources authorized under this bill are subject to the management and budget act, 1984 PA 431, MCL 18.1101 to 18.1594.

Sec. 203. (1) The sums appropriated in this bill are appropriated for community colleges with a fiscal year ending June 30, 2000 and shall be paid out of the state treasury and distributed by the state treasurer to the respective community colleges in 11 monthly installments on the sixteenth of each month, or the next succeeding business day, beginning with October 16, 1999. Each community college shall accrue its July and August 2000 payments to its institutional fiscal year ending June 30, 2000. However, if a community college fails to submit all verified Michigan Community Colleges Activities Classification Structure data for school year 1998-99 to the department of education by November 1, 1999, the monthly installments shall be withheld from that community college until those data are submitted. The department of education shall publish the Activities Classification Structure Manual for Michigan Community Colleges on or before March 1, 2000 for use by the legislature during budget development for the fiscal year ending September 30, 2001. The amount from the funds appropriated in part 1 that is allocated under section 103 to address the special needs of at-risk students shall be paid in full by the state treasurer by November 1, 1999. The amount distributed to a community college or department shall not exceed the net state allocation authorized by this bill.

(2) Except as otherwise provided by law, each of the amounts appropriated shall be used solely for the respective purposes stated in this bill. The funds appropriated by this bill may be used to match the cost of any available programs under the Carl D. Perkins vocational and applied technology education act, Public Law 88-210, 98 Stat. 2435, including local administration.

Sec. 204. (1) The auditor general or an independent public accounting firm appointed by the auditor general shall audit data for the fiscal year ending on June 30, 1999 as submitted on the department of education request forms of 7 randomly selected community colleges. A community college shall maintain and provide those records necessary for the auditor general or certified public accountant appointed by the auditor general to determine the accuracy of the reported data. The audits shall be based upon the definitions and requirements contained in the Manual for Uniform Financial Reporting, Michigan Public Community Colleges, published by the Michigan state board of education in 1981, and the Activities Classification Structure Manual for Michigan Community Colleges, 1997 revision of the final report of the activities classification structure task force (July 1981), published by the department of education. Before the submission of a final audit report, a community college may appeal the findings of the preliminary report under an appeal process to be established by the auditor general. The auditor general shall submit a report of the findings to the house and senate appropriations committees, the department of education, and the state budget director before June 1, 2000.

(2) The auditor general or a certified public accountant appointed by the auditor general shall conduct not less than 3 performance audits of community colleges but may conduct more if the auditor general considers it necessary.

(3) Not more than 60 days after an audit report is released by the office of the auditor general, the principal executive officer of the community college that was audited shall submit to the house and senate appropriations committees, the house and senate fiscal agencies, the department of education, the auditor general, and the state budget director a plan to comply with audit recommendations. The plan shall contain projected dates and resources required, if any, to achieve compliance with the audit recommendations, or a documented explanation of the college's noncompliance with the audit recommendations concerning the matters on which the audited community college and office of the auditor general disagree.

(4) A community college whose audited activities classification structure data is significantly different than the data used to determine state aid under this bill shall return any overappropriated funds as provided in this section. The department of education shall compare formula computations for the audited colleges using pre- and post-audit data. If the state allocation is 2% or more than the post-audit allocation amount, the college shall return the excess funds. The returned money shall be redistributed to all 28 community colleges, prorated on the base appropriations contained in part 1.

Sec. 205. The department of education shall revise and update the taxonomy of the 7 community colleges selected for audit under section 204(1) pursuant to the Activities Classification Structure Manual for Michigan Community Colleges, 1997 revision of the final report of the activities classification structure task force (July 1981), published by the department of education.

Sec. 206. (1) A community college shall retain certified class summaries, class lists, registration documents, and student transcripts that are consistent with the taxonomy of courses. For each enrollment period during the fiscal year, these certified documents shall identify clearly by course the number of in-district and out-of-district student credit and contact hours. The class summaries and class lists shall be consistent with each other and shall include the course prefix and numbers, course title, course credit and contact hours, credit and contact hours generated by each student, and activity classifications consistent with the taxonomy. An auditable process shall be used by the community college to determine the unduplicated head count for in-district students, out-of-district students, and prisoners for each enrollment period during the fiscal year.

(2) Contracts between the community college and agencies that reimburse the community college for the costs of instruction shall be retained for audit purposes.

Sec. 207. Each community college shall have an annual audit of all income and expenditures performed by an independent auditor and shall furnish the independent auditor's management letter and an annual audited accounting of all general and current funds income and expenditures including audits of college foundations to the senate and house fiscal agencies, the auditor general, the department of education, and the state budget director before November 15, 1999. If a community college fails to furnish the audit materials, the monthly state aid installments shall be withheld from that college until the information is submitted. All reporting shall conform to the requirements set forth in the Manual for Uniform Financial Reporting, Michigan Public Community Colleges, published by the Michigan state board of education in 1981.

Sec. 208. (1) A community college shall pay the employer's contributions to the Michigan public school employees retirement system created by the public school employees retirement act of 1979, 1980 PA 300, MCL 38.1301 to 38.1408, as a condition of receiving funds appropriated under this bill.

(2) A community college shall not pay an employer's contribution to more than 1 retirement fund providing benefits for an employee.

Sec. 209. An appropriation contained in this bill shall not be used for the construction of buildings for, or operations of, a community college not expressly authorized in part 1. Funds appropriated in part 1 shall not be used to pay for the construction or maintenance of any self-liquidating project.

Sec. 210. The department of education shall ensure that a statistical report for minorities and women employees for the most recent school year as submitted to the federal government on the EEO-6 form be included in the Michigan Community Colleges Enrollment Profile published by the department of education. Also included in this profile shall be a statistical report for the most recent school year that includes enrollment statistics for minorities and women as submitted to the department of education. The department of education shall distribute a copy of this report to members of the house and senate appropriations subcommittees on community colleges, the house and senate fiscal agencies and the state budget director no later than March 1, 2000.

Sec. 211. (1) Each community college shall report the following to the house and senate appropriations subcommittees on community colleges, the house and senate fiscal agencies, the department of education and the state budget director, no later than November 1, 1999:

(a) The number of North American Indian students enrolled each term for the previous fiscal year, using guidelines and procedures developed by the department of education and the Michigan commission on Indian affairs.

(b) The number of Indian tuition waivers granted each term, and the monetary value of the waivers for the previous fiscal year.

(2) Colleges shall use the criteria cited in 1976 PA 174, MCL 390.1251 to 390.1253, to determine eligibility for tuition waivers, and shall grant such waivers to individuals who meet the criteria and request tuition waivers.

Sec. 212. From the general fund/general purpose appropriation in part 1, there is allocated $368,458.00 to make reimbursement to community colleges, as provided by section 12 of the Michigan renaissance zone act, 1996 PA 376, MCL 125.2692, for property taxes levied in 1999. Reimbursements shall be made in amounts to each eligible recipient no later than 60 days after the department of treasury certifies to the state budget director that it has received all necessary information to properly determine the amounts due each eligible recipient pursuant to section 12(4) of the Michigan renaissance zone act, 1996 PA 376, MCL 125.2692. Any excess allocations shall lapse to the general fund.

Sec. 213. Upon request, a community college shall inform interested Michigan high schools of the aggregate academic status of its students for the fiscal year beginning October 1, 1999, in a manner prescribed by the Michigan community college association and in cooperation with the Michigan association of secondary school principals.

Sec. 215. Each community college shall report to the department of education, the house and senate appropriations committees, the house and senate fiscal agencies and the state budget director the numbers and type of associate degrees and other certificates awarded during the previous fiscal year. The report shall be made not later than November 15, 1999.

STATE AID - OPERATIONS

Sec. 301. Unless otherwise stated, all data items used in determining state aid in this bill are as defined in the Manual for Uniform Financial Reporting, Michigan Public Community Colleges, published by the Michigan state board of education in 1981, which shall be the basis for reporting data, and the Activities Classification Structure Manual for Michigan Community Colleges, 1997 revision of the final report of the activities classification structure task force (July 1981), published by the department of education, which shall be used to document financial needs of the community colleges.

Sec. 302. A community college shall not include in the enrollment report any student credit hours or student contact hours for a student incarcerated in a Michigan penal institution. Exclusion of these students is intended to avoid the payment of state aid under this bill for the same individuals for whom reimbursement is provided by the state correctional system.

GRANTS

Sec. 401. (1) The community college at-risk student success program is continued. The funding shall be prorated among community colleges based on the number of student contact hours for developmental and preparatory instruction reported by each community college to the department of education for use in the Activities Classification Structure Manual for Michigan Community Colleges, 1997 revision of the final report of the activities classification structure task force (July 1981), published by the department of education. Of the amount appropriated in part 1 for the at-risk student success program, $1,120,000.00 is allocated for base grants of $40,000.00 each, to address the special needs of at-risk students at community colleges or the acquisition or upgrade of technology related equipment and software.

(2) Of the amount appropriated in part 1 for the at-risk student success program, the balance of the appropriated funds shall be distributed on a proration utilizing the sum of the most recent 3 years developmental/preparatory contact hours divided by the sum of the 3-year total contact hours at each college. Each community college's percentage shall be divided by the sum of all such percentages systemwide to obtain each community college's prorated grant amount.

(3) For the fiscal year ending September 30, 2000, the at-risk student success program money is allocated as follows:

Alpena Community College $ 123,339

Bay de Noc Community College 114,328

Delta College 105,062

Glen Oaks Community College 128,094

Gogebic Community College 74,735

Grand Rapids Community College 76,248

Henry Ford Community College 165,262

Jackson Community College 111,433

Kalamazoo Valley Community College 114,457

Kellogg Community College 147,324

Kirtland Community College 135,754

Lake Michigan College 179,730

Lansing Community College 119,933

Macomb Community College 84,971

Mid Michigan Community College 115,524

Monroe Community College 99,520

Montcalm Community College 71,875

Mott Community College 104,786

Muskegon Community College 204,401

North Central Michigan College 147,238

Northwestern Michigan College 126,094

Oakland Community College 160,819

St. Clair Community College 74,515

Schoolcraft College 148,320

Southwestern Michigan College 185,189

Washtenaw Community College 137,820

Wayne County Community College 189,810

West Shore Community College 137,985

(4) For the purposes of this section, "at-risk students" means students who meet 1 or more of the following criteria:

(a) Are initially placed in 1 or more developmental courses as a result of standardized testing or as a result of failure to make satisfactory academic progress.

(b) Are diagnosed as learning disabled.

(5) Grant funding under this section shall be utilized to address the special needs of at-risk students or for equipment or upgrade of information technology hardware or software. Activities related to services provided to at-risk students include, but are not limited to, pretesting for academic ability, counseling contacts, and special programs. Equipment or information technology hardware or software purchased under this section need not be associated with the operation of a program designed to address the needs of at-risk students.

(6) Grant funding under this section shall not be used for indirect costs including, but not limited to, rent, utilities, or, except as provided in this section, college administration.

(7) Each community college shall report to the house and senate appropriations subcommittees on community colleges, the house and senate fiscal agencies, the state budget director, and the department of education a summary of all accomplishments under, expenditures for, and compliance with the intent of this program, including the number of at-risk students served. The report is subject to audit as provided for in section 204(1). The report shall be submitted not later than 90 days after the end of the state's fiscal year. The department of education shall make available a summary report of the program.

(8) Each community college receiving grant money under this section shall, not more than 12 months after receipt of that money, certify to the state treasurer, the state budget director, the house and senate fiscal agencies, and the auditor general whether all the grant money is expended or encumbered.

Sec. 402. (1) The appropriation in section 103 for the tuition restraint incentive grant is contingent upon the repeal of the Michigan college tuition and fees credit, section 274 of the income tax act, 1967 PA 281, MCL 206.274 effective for the 1999 tax year. Pursuant to the requirement established in subsection (2), the amount identified for tuition restraint incentive grants in section 103 of this bill shall be allocated to Michigan community colleges as follows:

Alpena Community College $ 68,884

Bay de Noc Community College 63,798

Delta College 199,512

Glen Oaks Community College 30,394

Gogebic Community College 60,341

Grand Rapids Community College 262,734

Henry Ford Community College 296,921

Jackson Community College 174,791

Kalamazoo Valley Community College 152,793

Kellogg Community College 126,787

Kirtland Community College 43,056

Lake Michigan College 69,367

Lansing Community College 431,056

Macomb Community College 470,227

Mid Michigan Community College 56,470

Monroe County Community College 55,398

Montcalm Community College 44,671

C.S. Mott Community College 220,722

Muskegon Community College 124,117

North Central Michigan College 41,399

Northwestern Michigan College 121,689

Oakland Community College 305,802

St. Clair County Community College 97,724

Schoolcraft College 166,010

Southwestern Michigan College 80,956

Washtenaw Community College 159,532

Wayne County Community College 242,855

West Shore Community College 31,994

(2) The distribution of the allocation to each community college in subsection (1) shall be made if the community college adopts a student tuition and fee increase for the 1999-2000 academic year of three percent or less and certifies such to the state budget director.

(3) The allocations contained in subsection (1) are proportionate to the fiscal year 1999 appropriations to community colleges.

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