Times Says Washington State Budget Agreement "in principle" Reached

From the Times.

Apparently this WILL prevent a shutdown of the state government on July 1.   No details have yet been provided.  The Governor's office has apparently been instrumental in getting both sides to the table. 

"They're definitely forcing closure, which is a great thing, (Ross) Hunger said, referring to the Governor's office. 

I would be willing to bet that the teachers don't get much of a raise that that I-1351 is mostly on-hold (something like I-728). 

From the Mike Klonsky's SmallTalk blog, Class Size: The Common Sense Bus doesn't stop on School Reform Blvd.


Anonymous said…
Remember that a COLA is not a raise. It is merely a cost of living adjustment.
Raises come from the locally bargained CBAs that the legislature now wants to limit.
Pros and cons to the latter. Would be good if the state takes on more of the funding like it should, but bad if it results in teachers living in more expensive areas making the same amount of money as a teacher living in Omak. I’ve heard plenty from teachers trying to live in Seattle/Bellevue so they are close to the community they work in, but having to move out to Lynnwood or Federal Way or beyond to find affordable housing.
Unfortunately, the GOP seems to have it in for the class-size initiative (most of the high-ranking GOPers have kids in private schools or in richer districts with smaller classes), even though it passed by a larger margin than the Gates-purchased charter school initiative, and Dems haven’t been highly supportive of it either, so having them suspend or gut another one does not surprise me.

Watching said…
It is possible for multiple scenarios to play-out and I'm not getting excited. As a matter of fact, I'm feeling a bit concerned. It will be very important to see whether or not a levy swap and/or caps to levy funding remained on the table.

This from SPS budget document:

- Potential loss of 4% levy lid capacity = $19.0M in 2015 $
- Potential loss of ‘ghosting’ (I-728/I-732) in levy = $23.2M in 2015$
- Potential loss of both 4% and ghosting in levy = $39.7M in 2015$
- Potential increase in state funding (McCleary)??
Anonymous said…
Passing a budget was first priority. Second priority, progress towards McCleary. Third priority I-1351. McCleary, I'm sure they made some progress towards more adequate funding, simply by increasing resources. As for decreasing the local levy burden and shifting that to the state, I believe that was too controversial and complex to pass in this session, but maybe the Supreme Court will set a new deadline of six months or a year for that. I-1351 is a battle for another day. The legislature pulled through and kept government running, saving a bipolar initiative process that lets citizens vote for billion dollar teacher raises, billion dollar class size, while cutting car tabs, and keeping low taxes on millionaires. The voters get to spoil everyone from teachers to millionaires with no fiscal accountability. Totally asinine process, and who's the first face that comes to mind?

Anonymous said…
I don't know. Who is it? For me, it's Reagan.

Anonymous said…

Anonymous said…
Yes, Timmeh-boy is the answer. Could Reagan be Eyman's secret real father...

Stu said…
It'll be interesting to see, as this plays out, if they go through with the lower tuition for the state universities. On the one hand, it would make college more accessible to more students; on the other hand, those of us who've fully invested in the GET program might lose a significant amount of money. (They're talking about compensating for the lower value by giving more "shares"; it will be interesting to see how that change affects the use of GET money on out-of-state tuition.)

Karen said…
This isn't to you, Stu, but more to the state Treasurer. The GET program should NOT drive the price of college.

To not reduce tuition because of the GET program is the most ridiculous thing I've heard in a while. I'm an investment analyst so I've looked at this in great detail. The plan wasn't designed to provide "profits", but that is what it did from inception through 2009. April of 2009 was the last reasonable GET credit price. Anyone buying in after that has been funding a Ponzi scheme REGARDLESS of future tuition costs.

You could buy a year of college for $7600 at the end of 2008. In May of 2014, it was $17,200. That's a 126% increase! So, the current investors are funding college for the early investors. The state hopes the plan will be fully-funded by 2018. You can translate that as "we need to rip-off new investors to cover early investors since we really miscalculated".

MANY people have made a ton of money through their GET investments. Again, that wasn't what it was designed to do. That happened because college increased at such an obnoxious rate and the plan wasn't properly designed. So, the new purchasers are, and have been since mid-2009, paying inflated prices in order to cover the current college-goers.

So, some people bought in at insanely over-valued prices, but that's life. They haven't lost anything since their college costs are still covered for a year if they bought 100 units.

Reducing unit costs significantly is the only way investing in this plan would make any sense. Unless, of course, you think college will costs will increase 15%/year every year.

The taxpayers will be on the hook for this mess.
karen said…
By the way, the above comments are very high level and meant to be illustrative only. The analysis is quite complex since you need to consider the $117/unit current payout price, as well. At a $172 purchase price, college needs to increase by almost 50% from current prices for you to break even.

Also, this is all assuming you paid in cash up front. The financing costs make the program even more messed-up to the investor. The financing costs alone about match the average annual college tuition increase. Forget about the inflated unit purchase price or the differential between current purchase price and current payout value!!
Patrick said…
Karen, I agree. I'm one of the fortunate ones who bought lots of GET units in 2008, but I regarded it as pure good fortune that it insulates me from the worst effects of the tuition increases. To stretch an analogy, just because I have fire insurance doesn't mean I want to see my whole block burn down.

Affordable tuition is one of the best long-term investments the state can make. We have a high tech sector here that imports most of our skilled workers from other places, we're not educating enough of them ourselves. In the long run, that's not a good plan.
Anonymous said…
"We have a high tech sector here that imports most of our skilled workers from other places, we're not educating enough of them ourselves. In the long run, that's not a good plan."

Patrick, no offense, but you don't know what you're talking about.

IT worker
Patrick said…
IT Worker, okay, so which part do you disagree with? That we don't educate enough skilled workers to meet our own needs, or that it's a bad thing that we don't?
Anonymous said…
They import IT workers because they are cheaper than US IT workers. They keep screaming about not enough workers but I know plenty of IT workers who get laid off and replaced by imports.

Anonymous said…
Tech workers are imported under false pretenses when companies abuse the H1B visa program. BTW the companies that actually "import" and employe the H1B workers are East Indian and they subcontract workers to US tech companies. In most cases US high school students can perform the jobs the visa abusers are doing.

H1B visas are used to lower wages. Non-US visa holders don't form unions.

We have plenty of tech workers here in the US and could easily train high school students to perform most of the tech jobs available. Don't believe companies like Microsoft, Amazon, Google and Facebook. These companies just want a more corporate favorable work force.

Companies use the visas to displace American workers and drive down salaries, both of which are expressly prohibited by law. Six of the top 10 companies receiving H-1B visas for workers in 2013 are based in India. The top two are Unisys and Tata Consultancy Services, the firms Southern California Edison hired to outsource the work of their 500 IT employees, 400 of whom are being laid off and 100 of whom are leaving voluntarily. About 70% of the work will shift overseas; about 20% of the jobs that remain in the U.S. are held by foreigners with H-1B visas

IT worker
Patrick said…
I agree about the H1B program, but that wasn't what I was talking about.

I'm speaking of Washington's tech sector importing scientists and engineers from other states, not from other countries via the H1B program. It's not the jobs being done by high school grads or community college grads getting done by H1B holders, but the jobs that need a bachelor's or master's. There aren't enough grads in Washington to fill the needs of Washington tech companies, so we're getting them from elsewhere rather than expanding our state's scientific and technical education.
Anonymous said…
Patrick, again you don't seem to have a full understanding of what you're talking about. "but the jobs that need a bachelor's or master's." Tell you what go out and look at the job postings for the CS/IT jobs that you think need a bachelor's or master's. You will notice a common disclaimer. "or equivalent experience"

I have no problem with the legitimate use of visas or US citizens coming to WA state. Since I work in the field and might know a little bit about what's going on and I will disagree with your assessment. The most proficient leading edge tech workers are self taught. They might get a little basic education, but after that things move too fast for schools to keep up and we leave for greener pasture$. I can train the right interested tech savy high school kid to perform many of the tech jobs that companies are hiring H1B workers for and feel confident they will grow to assume greater responsibility and real world skills. These kids don't have $110K in student loans and never have to realize they wasted most of their time and money. You need to understand you don't need 6 years of collage to write code period. Many CS students need loads of hand holding and probably benefit from some parts of a CS program, but the naturals don't. If you ask people who have been in the field a while with CS degree they will tell you everything useful they know was learned on the job passed on to them from a season veteran. It's unfortunate many probably think FaceBook is a technology or Amazon's one click check out was a scientific break through and therefore these companies can break the rules and must hired workers from India with PHDs in javascript. What we need and are looking for are people with good math skills, some basic understanding of computers and a passion for technology. These type of people tend to come up with innovation and are not cookie cutter CS students.

As you wrote "There aren't enough grads in Washington to fill the needs of Washington tech companies, so we're getting them from elsewhere rather than expanding our state's scientific and technical education." Patrick I challenging you to prove it.

IT worker
Patrick said…
IT Worker, what you write leaves me more depressed than ever about the state of IT. You persist in rebutting claims I didn't make about people writing easy programs in easy programming languages. Yes, if all you want to do is write Javascript and you spent 100,000 dollars and four years getting a degree for it, you have wasted a lot of time and money, and should expect to get replaced by an H1B or someone overseas. Once again, I am not writing about those coders. What a bachelor's degree *should* do is enable the graduate to apply different fields to each other, to learn new skills when they are needed even far after graduation. Granted, that doesn't always happen, and plenty of science and engineering students don't see the point of all those distribution classes at the time, but that's what *should* be happening. People who can do that may not be better script coders, but they'll be a lot better at designing programs that users want to use. And they can't easily be replaced by H1Bs.

Anyway, this is getting very far from the topics of the state budget.

Anonymous said…
Patrick again you are wrong and have no idea what is going on in IT and that is more than evident in your statement " but they'll be a lot better at designing programs that users want to use." Patrick says "writing easy programs in easy programming languages." BTW you do know that the WWW runs primarily on javascript right? Patrick, web programing is actually some of the most challenging, can you tell us why?
Please amaze us with your OOD or FPGA skills. I'll wait.

Remember this was your tangent, so Patrick what are you really writing about?

IT worker
n said…
IT worker, I know what you're talking about. Every field and especially "new frontier" fields attract the most passionate devotees. And they do learn on their own: ie Bill Gates who never graduated. And the techies who gave their services to Pixar and other companies who were cutting edge in the field of special effects and who now pay their best people peanuts compared to the contributions they've made to profit margins. But now many kids confuse playing video games with ITT skills. Coding is pretty low level. Right?

We try to push too many kids into college these days. It doesn't matter if it is teaching or cutting edge computer skills, we need to go back to giving our kids a well-rounded enriched learning experience in all areas: mathematics, writing, reading - all the basics and let kids find their bliss. And college degrees will be a choice by those who really want to pursue an interest academically and those who choose something else.

And the abuse of H1B is a different conversation altogether. Higher ed is an achievement that not everybody wants but feels compelled to get. It is as if universities have become profit-making corporations. They have the same mentality. I think Gaetano (right Melissa?) taught students who had a passion, didn't he? It is all out-of-whack to me. I think they should go back to being smaller and more selective and tailor themselves to the needs of particular groups of students who need and really desire that degree for a higher purpose. And this is a budget issue. It is one of refining your offerings to people who really want them and need them. Smaller, more efficient and cheaper.
Anonymous said…
The new budget is in, http://www.capitolrecord.org/
Generally good news for schools.

Lynn said…
I guess I'd better hope my (GET unit-holding) kids are accepted at the UW. Out of state and private schools are even more out of reach now.
James Kerr said…
Anonymous - To correct your comment, Unisys was NOT one of the top companies that received H-1B visas for workers in 2013. The correct company is Infosys. The LA Times corrected its original editorial to that effect. See "For the Record" at http://www.latimes.com/opinion/editorials/la-ed-visas-tech-workers-h1b-20150217-story.html
Anonymous said…
Over the course of 7 years between 2007 and 2014 tuition doubled, so I assume GET assets doubled, which was obviously not funded by market investment performance of those assets. A few flat years ahead and that is a problem?

Perhaps the GET is a poorly designed financial product which should be wound down before it does damage to the state budget. Is it a pyramid scheme? If the early participants sucked out more value than the market was delivering on their investements, the later participants or the state will have to pay that bill, it is as simple as that.

Should the state be in the business of guaranteed college savings plans for private schools, I would say no. But of course the choice of school is unknown ahead. The state should guarantee a return of 8% when used at an in state school, and a return of 4%, if not used for whatever reason. Indexing the program to tuition is volatile and does not provide the financial security good savers are deserve.

Anonymous said…
States with the highest number of students enrolled per teacher in public elementary and secondary schools in fall 2012:

California (24.9),
Oregon (21.8),
Utah (21.6),
Washington (19.7), and
Indiana (18.6).

States with the lowest student-teacher ratios were:

Vermont (9.2),
Nebraska (9.8),
New Jersey (12.0),
New York (12.0), and
New Hampshire (12.1).

Class sizes are larger than these ratios.


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