For the 2013-15 biennium, the legislature approved $450 million for community colleges. This amount was later increased to $465 million contingent on state revenue forecasts meeting expectations. Community college funding was distributed in FY 2013-14 at the $450 million level and for FY2014-15 it will be distributed as if funding for the entire biennium were $465 million. This means state revenue will be higher in FY2014-15 than it would have been had the $465 million been equally distributed among both fiscal years. With the formation of the Oregon Education Investment Board (OEIB) in 2011, future funding is uncertain. OEIB was created for the purpose of “overseeing a unified system of public education from birth to college and career”. The overarching goal of OEIB is known as “the 40-40-20 goal”. This is shorthand for the commitment by the state to improve educational attainment. The Oregon legislature adopted the goal to ensure that, among the group of all adult Oregonians, 40% will have earned a bachelor’s degree or higher, 40% will have earned an associate’s degree or post-secondary credential, and 20% will have earned at least a high school diploma or equivalent by the year 2025. In support of the 40-40-20 goal, the Higher Education Coordinating Commission was formed and charged with overseeing and coordinating all higher education in Oregon. Part of their responsibility is to develop funding requests and their methods of distribution. This is the cause of the funding uncertainty but, fortunately community colleges are seen as a critical piece of the education continuum from birth to college and career and the achievement of the 40-40-20 goal. Any future additional funding for community colleges will likely be tied to the achievement of this goal.
Property taxes are expected to continue to grow at a low level. The assumed growth rate for FY2014-15 is 1%. Taxes imposed slowed to this rate in FY2012-13 and it is anticipated that the rate of growth will return to the capped 3% rate within a few years as the economy and housing market continue to improve. The factors that may slow a quicker return are:
The college slowly grew the ending fund balance over nine years to just over $9.4 million at the end of fiscal year 2011-12 in order to save for unanticipated revenue shortfalls. The college’s target for the ending fund balance is ten to fifteen percent of expenditures. Part of the 2011-12 fund balance was used in fiscal year 2012-13 and it is anticipated that additional amounts of fund balance will also be used in fiscal years 2013-14 and 2014-15 to help support the General Fund with the hope that the economy and resulting funding will rebound.