From the Desk of Delegate Perry:
The Legislature returned to Charleston last week for August’s interim meetings. Many of those meetings that I attended focused on finances as state agencies begin to feel the effects of the 7.5 percent across the board budget cuts for fiscal year 2014.
One agency feeling the full impact with the budget cuts are the Higher Education Policy Commission (HEPC) and the Community and Technical College System (CTCS). HEPC Chancellor Paul Hill and CTCS Chancellor Jim Skidmore presented to a couple of Education committees on what the budget cuts will mean for higher education costs in West Virginia.
Both Chancellors informed the committee that the state’s colleges and universities have to adapt to the cuts but emphasized that financial aid will NOT be affected by the cuts. Full financial aid will remain intact. However, college tuition rates rose at almost all institutions of higher education in the process. Higher Education will have to brace themselves for another possible 7.5 percent budget cut for the 2014-15 year as well. Higher Education institutions will also face a reduction in enrollment as the number of high school students attending college is dwindling.
The Chancellors also informed the committee of the HEPC and CTCS’s efforts in working to improve and accelerate remedial classes for incoming freshmen who are not prepared for college-level course work. The focus for these classes is the fact that more and more students are not completing their classes on time. Figures show that for every 100 students required to take developmental math their first semester, only 22 will go on to earn a four-year degree. Through remedial classes the number to graduate would be around 98. Chancellor Hill told the committee that what will be helpful in their endeavors is the Presidents’ of each higher education institution supporting the HEPC and CTCS’s efforts.
Higher Education was not the only agency reporting on their financials issues this month. The Chief Financial Officer with the Regional Jail Authority presented the current financial situation of West Virginia’s regional jails. The committee has expressed worries to the Regional Jail Authority on the Authority’s handling money which results in counties having to pay more. It is believed that the Authority had an excess of around $24 million in their two accounts. The Chief Financial Officer told the committee that these funds are designated for various uses including funding the yearly $8.9 million bond payment the Authority has been paying on since 1998. The bond being paid on was for the original construction of the jails in the state. The other part of the funding is an emergency reserve, which is required by law, of 125 percent of the bond payment which is about $11 million. The other funds are held for inmates in a type of personal bank account.
The other fund that the committee inquired about was the cash and cash equivalents fund which has a balance of nearly $45 million. State law requires three months of emergency operating costs for the Authority, money for capital improvement projects and ancillary funds used to make bond payments when there’s a deficit in collections, which there is a growing deficit. This means this money cannot really be touched unless under emergency.
Worries on many of the members’ minds are if the Authority has this kind of funds then where is the money for the per diem rates counties have to pay going. If the money is there then maybe the rate should be lowered. However, the Executive Director of the Authority told the committee that he would be cautious on lowering the per diem rate because the future of funding for regional jails is unknown.