SENATE BILL No. 963

EXECUTIVE BUDGET BILL

February 3, 2000, Introduced by Senators GAST, GOSCHKA, MC MANUS, VAUGHN,

JOHNSON and A. SMITH and referred to the Committee on Appropriations.

A bill to make appropriations for community colleges and certain state purposes related to education for the fiscal year ending September 30, 2001; to provide for the expenditure of those appropriations; to establish or continue certain funds, programs, and categories; and to prescribe the powers and duties of certain state departments, institutions, agencies, employees, and officers.

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, 2001, from the funds indicated in this part. The following is a summary of the appropriations in this part:

COMMUNITY COLLEGES

APPROPRIATION SUMMARY:

GROSS APPROPRIATION $ 316,198,478

Total interdepartmental grants and

intradepartmental transfers $ 0

ADJUSTED GROSS APPROPRIATION $ 316,198,478

Total federal revenues 0

Total local revenues 0

Total private revenues 0

Total local and private revenues 0

Total other state restricted revenues 10,000,000

State general fund/general purpose $ 306,198,478

Sec. 102. OPERATIONS

Alpena Community College $ 5,073,576

Bay de Noc Community College 4,857,916

Delta College 14,230,014

Glen Oaks Community College 2,336,201

Gogebic Community College 4,156,155

Grand Rapids Community College 18,092,391

Henry Ford Community College 21,625,899

Jackson Community College 12,181,665

Kalamazoo Valley Community College 12,055,784

Kellogg Community College 9,541,445

Kirtland Community College 2,965,517

Lake Michigan College 5,133,574

Lansing Community College 30,806,692

Macomb Community College 33,223,327

Mid Michigan Community College 4,336,804

Monroe County Community College 4,146,217

Montcalm Community College 3,111,997

Mott Community College 15,650,542

Muskegon Community College 8,911,678

North Central Michigan College 3,016,073

Northwestern Michigan College 9,007,943

Oakland Community College 21,058,314

St. Clair County Community College 6,993,790

Schoolcraft College 12,194,157

Southwestern Michigan College 6,421,945

Washtenaw Community College 12,176,037

Wayne County Community College 16,476,511

West Shore Community College 2,291,080

GROSS APPROPRIATION $ 302,073,244

Appropriated from:

State general fund/general purpose $ 302,073,244

Sec. 103. GRANTS

At-risk student success program $ 3,692,103

Renaissance zone tax reimbursement funding 433,131

GROSS APPROPRIATION $ 4,125,234

Appropriated from:

State general fund/general purpose $ 4,125,234

Sec. 104. FINANCIAL AID

Lieutenant Governor's commission on financing

postsecondary education recommendations $ 10,000,000

GROSS APPROPRIATION $ 10,000,000

Appropriated from:

Special revenue funds:

Michigan tobacco settlement trust fund $ 10,000,000

State general fund/general purpose $ 0

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 under part 1 for fiscal year 2000-2001 is $316,198,478 and state appropriations to be paid to local units of government is $306,198,478.

(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 for any quarter under subsection (1), the principal executive officer shall immediately give notice of the approximate shortfall to the state budget director, the senate and house of representatives standing committees on appropriations, and the senate and house fiscal agencies.

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 fiscal years ending June 30, 2001 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, 2000. Each community college shall accrue its July and August 2001 payments to its institutional fiscal year ending June 30, 2001. However, if a community college fails to submit all verified Michigan community colleges activities classification structure data for school year 1999-2000 to the department of career development by November 1, 2000, the monthly installments shall be withheld from that community college until those data are submitted. The department of career development shall publish the activities classification structure data book for Michigan community colleges on or before March 1, 2001 for use by the legislature during budget development for the fiscal year ending September 30, 2002. 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, 2000. 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, 2000 as submitted to the department of career development 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, 1996 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 career development, and the state budget director before June 1, 2001.

(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 career development, 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 career development 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 career development shall review 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, 1996 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 chairs of the house and senate appropriations subcommittees on community colleges, the senate and house fiscal agencies, the auditor general, the department of career development, and the state budget director before November 15, 2000. 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 career development 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 career development. Also included in this profile shall be a statistical report for the most recent school year that includes enrollment statistics from the current and prior year for minorities and women as submitted to the department of career development. The department of career development shall distribute a copy of this report to the state budget director and to members of the house and senate appropriations subcommittees on community colleges and the house and senate fiscal agencies no later than March 1, 2001.

Sec. 211. (1) Each community college shall report the following to the department of career development, no later than November 1, 2000:

(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 career development and the department of civil rights.

(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.

(3) The department of career development shall compile the information received under subsection (1) and shall submit this compilation to the senate and house appropriations subcommittees on community colleges, the senate and house fiscal agencies, and the state budget director by January 7, 2001.

Sec. 212. From the general fund/general purpose appropriation in part 1, there is allocated $433,131.00 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 2000. 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, 2000, in a manner prescribed by the Michigan community college association and in cooperation with the Michigan association of secondary school principals.

Sec. 214. (1) Recognizing the critical importance of education in strengthening Michigan's workforce, the state's public community colleges are encouraged to explore ways of increasing collaboration and cooperation with 4-year universities, particularly in the areas related to training, instruction, and program articulation.

(2) Community colleges shall report by December 1, 2000 to the department of career development on steps they have taken to increase collaboration and cooperation with 4-year universities under subsection (1).

(3) The department of career development shall compile the information received under subsection (2) and shall submit this compilation to the state budget director, senate and house appropriations subcommittees on community colleges, and the senate and house fiscal agencies by January 7, 2001.

Sec. 215. Each community college shall report to the state budget director, house and senate fiscal agencies and the department of career development a modification in credit or contact hour tuition or mandatory non-course-related student fees not later than 30 days after the modification is established by the college governing board.

Sec. 216. (1) Each community college shall report to the department of career development 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, 2000.

(2) The department of career development shall compile the information received under subsection (1) and shall submit this compilation to the senate and house appropriations subcommittees on community colleges, the senate and house fiscal agencies, and the state budget director by January 7, 2001.

Sec. 217. (1) A community college receiving funding under this bill and also subject to the student right-to-know and campus security act, Public Law 101-542, 104 Stat. 2381, shall make a copy of all material prepared pursuant to the public information reporting requirements under the crime awareness and campus security act of 1990, title II of the student right-to-know and campus security act, Public Law 101-542, 104 Stat. 2384 available in electronic format accessible through the internet for school districts, parents, and students.

Sec. 218. The department of career development shall continue to pilot the use of the Internet to fulfill the reporting requirements in this bill. This may include transmission of reports via electronic mail to the recipients identified for each reporting requirement or it may include placement of reports on the Internet or on the Intranet. The appropriations subcommittee shall be notified in writing of the Internet/Intranet site of any such report.

Sec. 219. (1) Any community college receiving funds under part 1 that adopts a tuition and fee increase for the 2000-2001 academic year of 3.0% or less shall retain in its base for calculation of its appropriation for the fiscal year ending September 30, 2002 an amount equal to 1.5% of its base appropriations for the fiscal year ending September 30, 2001.

(2) Any community college receiving funds under part 1 that adopts a tuition and fee increase for the 2000-2001 academic year of more than 3.0% shall have its base calculation of its appropriation for the fiscal year ending September 30, 2002 reduced by an amount equal to 1.5% of its base appropriations for the fiscal year ending September 30, 2001.

(3) An amount equal to the reductions to base calculations of community colleges for the fiscal year ending September 30, 2002, as determined under subsection (2), shall be added to the base for calculating the 2001-2002 fiscal year appropriations of those community colleges adopting a tuition and fee increase of 3% or less for the 2000-2001 academic year. The funds added to the base for calculating the fiscal year 2001-2002 appropriations of the eligible community colleges under this subsection shall be allocated through the community college funding formula.

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, 1996 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 AND FINANCIAL AID

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 career development for use in the Activities Classification Structure Manual for Michigan Community Colleges, 1996 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, 2001, the at-risk student success program money is allocated as follows:

Alpena Community College $ 121,725

Bay de Noc Community College 105,324

Delta College 110,504

Glen Oaks Community College 131,210

Gogebic Community College 78,617

Grand Rapids Community College 76,714

Henry Ford Community College 168,324

Jackson Community College 114,933

Kalamazoo Valley Community College 118,490

Kellogg Community College 157,285

Kirtland Community College 145,724

Lake Michigan College 194,902

Lansing Community College 134,738

Macomb Community College 90,272

Mid Michigan Community College 123,549

Monroe Community College 102,673

Montcalm Community College 70,131

Mott Community College 105,617

Muskegon Community College 212,002

North Central Michigan College 178,833

Northwestern Michigan College 120,835

Oakland Community College 164,112

St. Clair Community College 77,130

Schoolcraft College 148,852

Southwestern Michigan College 186,227

Washtenaw Community College 148,858

Wayne County Community College 158,329

West Shore Community College 146,193

(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.

(c) Require English as a second language (ESL) assistance.

(5) Grant funding under this section shall be utilized to address the special needs of at-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 department of career development 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 career development shall compile the information received under this subsection and shall submit this compilation to the senate and house appropriations subcommittees on community colleges, the senate and house fiscal agencies, and the state budget director by 120 days after the end of the state's fiscal year.

(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) Community colleges shall use a portion of the funds appropriated in part 1 for operations to implement and institute the ideas and goals embodied by the partnerships for employment program or another program with similar nature and intent as the ideas and goals embodied in the partnership for employment program. For this program, community colleges shall form identifiable links with local businesses or local business alliances to ascertain the immediate and lasting employment needs of the community. In so doing, the colleges in conjunction with the businesses shall create specific, direct certificate programs that upon completion will lead to an increased likelihood of employment by the sponsoring businesses.

(2) When creating programs under subsection (1), the community colleges shall consider the following:

(a) The likelihood of the project directly providing a discrete population of unemployed or underemployed workers with job skills that will lead to increased likelihood of desired employment with the sponsoring businesses.

(b) The use of appropriations to efficiently coordinate existing but largely unconnected resources for worker training.

(c) The use of performance outcome measures to detail a correlation between partnering with local businesses to provide specific training, and the population attaining employment upon successful completion of such training.

(3) Each community college shall report to the department of career development by no later than September 30, 2001 on all of the following:

(a) The number of certificated programs created under this section.

(b) The job placement rate for graduates with sponsoring businesses under this section.

(c) The amount budgeted for the partnership for employment program.

(d) The amount expended and for what activities for the partnership for employment program.

(e) The number of employers who have agreed to hire participants who complete the partnership for employment program.

(4) The department of career development shall compile the information received under subsection (3) and shall submit this compilation to the senate and house appropriations subcommittees on community colleges, the state budget director, and the senate and house fiscal agencies by November 1, 2001.

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