Although the economy appears to be improving, Washington State’s revenue has taken a greater hit than expected, affecting BC’s budget in the process.
According to the Washington State Economic and Revenue Forecast, “the September 2009-11 biennium is $29.6 billion, which is $230.9 million less than expected in June. Twenty percent of the forecast reduction is the result of a state Supreme Court decision on Business and Occupation taxes.”
That means the state’s revenue (income before subtracting losses), is expected to be $230.9 million less than what was initially expected when the fiscal period began.
According to Rachel Solemsaas, BC’s Vice President for Administrative Services, “the share for higher education for this anticipated deficit will be limited by the maintenance of effort (MOE) required by the Federal stimulus (ARRA) funds that the state received for this biennium. Higher Ed’s share is projected at $80 million. Our system challenge is how the community and technical colleges (CTC) would fair with other higher educational institutions…in terms of the distribution of the $80 million. If we are allocated half or $40 million as our share, BC could anticipate a $2 million reduction in allocation.”
This means that BC would receive $2 million less in funding than initially expected.
Fortunately, BC has many sources of revenue, including but not limited to state allocation, tuition and fees paid by students, grants, contracts, etc.
The variety of sources for funding is what “makes Bellevue College one of the more progressive colleges because we are able to leverage our resources. We don’t purely depend on the state though they’re a big chunk of our budget,” said Solemsaas.
Nonetheless, because the school is anticipating less funding from the state than was expected in June, “just like last year, we’ll probably undergo a process of identifying additional savings,” said Solemsaas.
“When you’re faced with less, or a budget reduction in one of your major funds, there are two ways to approach that, you either increase revenue or decrease expenditures and what Bellevue has done in the past is a combination of both,” said Solemsaas.
The school is now in the course of planning for a budget reduction process.
To increase revenue, the school usually looks for an increase in grants, or programs such as the International Student Programs or Running Start.
An increase in enrollment could potentially increase revenue, however, “the unfortunate thing about that is how much of that can be sustained overtime,” said Solemsaas.
If BC were to depend on higher enrollment to increase revenue, and the school then augmented its capacities, the college runs the risk of eventually seeing enrollment rates decrease, requiring more cuts to be made.
Any cuts would be made with input from the students, staff, and faculty on campus.
Many students may be concerned about tuition increases.
With BC facing budget cuts, a tuition increase may be a possible way to increase revenue. However, the college doesn’t have the authority to increase tuition rates; the state legislature makes that decision.
The possibility of increased tuition costs could be daunting to many BC students, and to the college itself.
“If there’s a tuition increase, there has to be a corresponding increase in aid,” said Solemsaas.
Another update to the Washington State Economic and Revenue Forecast is scheduled for this month.
“We have to brace ourselves because we’re going to have to go through another budget reduction process,” said Solemsaas.