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The Oregon Administrative Rules contain OARs filed through March 15, 2014
 
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DEPARTMENT OF COMMUNITY COLLEGES AND WORKFORCE DEVELOPMENT

 

DIVISION 2

COMMUNITY COLLEGE FUNDING

Community College Support Fund Distribution

589-002-0100

Community College Support Fund Distribution

Purpose Statement:

(1) It is in the state's interest to support a strong local community college system that meets local, regional and state economic and workforce development needs. Short and long-term interests include the consideration of such things as comparable District funding capability, maintaining small districts as a means of educational access and stable, predictable funding. Oregon's community college distribution formula is designed to provide a financial foundation to support undergraduate and lower-division education, career technical education, remedial education, local response to workforce training, and other educational services necessary at the local and state level.

(2) The State Board through the authority vested in it by ORS 341.626, uses this rule to state clearly and concisely what the statewide interests are for Oregon community colleges and students through the adoption of a policy-driven distribution formula. The overarching policy, chosen by the State Board, has been structured to support access, stability and quality, and to do so with equity for Oregon students. Principles which support these policies include:

(a) Access is supported by having the funding follow the student to the college which they are attending.

(b) Quality is supported when adequate funding per student is available.

(c) Growth management is a tool to prevent erosion of the level of funding per student.

(d) Equity is supported by the equalization of public resources distributed per student.

(e) Stability is supported by buffering fluctuations in student enrollment through growth management and by using a three-year weighted average of students by college to distribute state funds.

[ED. NOTE: Tables referenced are not included in rule text. Click here for PDF copy of table(s).]

Stat. Auth.: ORS 326.051, 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Stats. Implemented: ORS 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Hist.: 1EB 9-1979, f. & ef. 6-11-79; EB 12-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0260; ODE 27-2000, f. & cert. ef. 10-30-00; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0200; DCCWD 2-2001, f. & cert. ef. 5-7-01; DCCWD 3-2002, f. & cert. ef. 6-5-02; DCCWD 7-2002(Temp), f. & cert. ef. 12-16-02 thru 6-5-03; DCCWD 3-2003, f. & cert. ef. 5-14-03; DCCWD 1-2004, f. & cert. ef. 7-1-04; DCCWD 1-2005, f. & cert. ef. 7-13-05; DCCWD 2-2006(Temp), f. & cert. ef. 6-15-06 thru 11-30-06; DCCWD 6-2006, f. 10-3-06, cert. ef. 10-4-06; DCCWD 8-2006, f. 12-13-06, cert. ef. 12-15-06; DCCWD 2-2007, f. & cert. ef. 7-6-07; DCCWD 4-2007, f. & cert. ef. 10-1-07; DCCWD 3-2009(Temp), f. & cert. ef. 8-5-09 thru 1-31-10; DCCWD 5-2009, f. & cert. ef. 10-28-09; DCCWD 1-2011, f. & cert. ef. 4-20-11; DCCWD 1-2012(Temp), f. & cert. ef. 7-17-12 thru 1-10-13; DCCWD 3-2012, f. & cert. ef. 12-26-12; DCCWD 3-2013, f. & cert. ef. 6-11-13

589-002-0110

Definitions

The following definitions apply to OAR 589-002-0100 through 589-002-0130.

(1) “Total Public Resources (TPR)” is what the Community College Support Fund formula considers 100% of the next year's imposed property tax revenue and the General Fund appropriation from the legislature. TPR does not include tuition and fees paid by students.

(2) “Base Payment” is an allocation made from the Community College Support Fund which provides funding for basic community college district operations that are essential and do not vary in direct proportion to the districts’ Full-Time Equivalent (FTE) student enrollment. The base allocation increases stability and predictability of funding for individual colleges.

(3) “Equalization” means equal public resource support per funded FTE, regardless of community college district, and exclusive of the base. Equalization is measured by dividing Total Public Resources, exclusive of the base, by funded FTE.

(4) “Property tax revenues” means the amount determined by the Department of Revenue to be imposed on local property following the application of limits imposed by sections 11(b)(1) through 11(b)(3), Article XI, of the Oregon Constitution, and those limits imposed by legislation implementing Ballot Measure 50. This amount becomes the basis for operation of the funding formula without regard to uncollectible taxes, or taxes collected from previous years. Taxes levied or imposed by a community college district to provide a public library system shall be excluded from the definition of property taxes in this rule. Property tax revenues raised through voter approval of any local option or capital construction levy are not to be included as a resource to be distributed through the funding formula.

(5) “Community College Support Fund (CCSF)” is funding received through the state's General Fund appropriation and distributed to the community college districts for funding educational programs.

(6) “Full-Time Equivalent (FTE) student” for the purpose of receiving state reimbursement, means a student who carries 510 clock hours over three terms of instruction for all terms including a fall 12-week term. All colleges with an 11-week fall term will have their fall term clock hours increased to the equivalent 12-week hours for the purpose of calculating reimbursable FTE.

(7) “Total Reimbursable FTE” means full-time equivalent students that are eligible for state reimbursement. These students must receive instruction from community college districts through either a contracted out-of district (COD) agreement described in OAR 589-002-0600, an agreement to provide services to state penitentiary or correctional institution inmates described in OAR 589-002-0700, or are CCSF reimbursable FTE, described in Section 8 of this rule and in OAR 589-002-0110 Sections (2) through (5).

(8) “CCSF Reimbursable FTE” means full-time equivalent students that are eligible, as described in OAR 589-002-0110 Sections (2) through (5) of this rule, for state funding through the CCSF Funding Distribution Formula, before the application of the Annual Growth Factor (AGF).

(9) “Contracted Out-of-District (COD) Reimbursable FTE” means full-time equivalent students that are not residents in the community college district that they are attending and for which the community college district has a contract to provide educational services with an entity in the geographic area from which the student resides. COD reimbursable FTE must meet all other requirements of a CCSF reimbursable FTE. The community college district must have a contract in place with the Department of Community Colleges and Workforce Development in order to receive reimbursement.

(10) “Fundable FTE” is the number of full-time equivalent students that are at or below each community college district’s FTE Cap. Fundable FTE is the lesser of either the CCSF reimbursable FTE or the FTE cap. This number is used in the three-year weighted average calculation that determines a community college district’s funded FTE as described in Section 11 of this rule.

(11) “Funded FTE” is the community college district’s number of full-time equivalent students used in the formula to distribute the CCSF funding for each community college district. This number is buffered to prevent significant changes in a community college district’s funding due to variability in student enrollment. It is calculated using a three-year weighted average of fundable FTE with the first year prior to current fundable FTE weighted at 40%, second year prior to current fundable FTE weighted at 30%, and third year prior to current fundable FTE weighted at 30%.

(12) “Total Funded FTE" is the sum of all community college districts’ funded FTE for a fiscal year.

(13) “FTE Cap” is the maximum number of CCSF reimbursable FTE per community college district, which may be included in the funding formula calculation. The FTE cap is determined by applying the annual growth factor and may be adjusted by the preliminary FTE cap as described in Section 14.

(14) “Preliminary FTE Cap” is a tool that allows a community college district to recover fundable FTE within one year, if the district’s CCSF reimbursable FTE is less than the FTE cap. There are two preliminary FTE caps. The first is based on the FTE cap from one year prior and the second is based on the prior year’s fundable FTE. The annual growth factor (as defined in Section 19 below) is applied to each. The current year’s FTE cap is the greater of these two numbers.

(15) “Growth Management” means the application of the Growth Management Component in combination with each community college district’s FTE cap.

(16) “Biennial Growth Management Component” is the percent change, from one biennium to the next, of the total number of FTE for all community college districts that could be included in the funding formula without reducing resources available per FTE. The biennial growth management component is determined by the amount of total public resources available for the current biennium compared to the prior biennium and the estimated increased cost of FTE.

(17) “State Board of Education’s Biennial Quality Growth Factor” is a policy lever that allows the number of FTE that will be counted for funding purposes to be above or below the Biennial Growth Management Component.

(18) “Total Biennial Growth Management Component” is the sum of the Biennial Growth Management Component and the State Board of Education’s Biennial Quality Growth Factor.

(19) “Annual Growth Factor (AGF)” is one-half of the Biennial Growth Management Component.

[ED. NOTE: Tables referenced are not included in rule text. Click here for PDF copy of table(s).]

Stat. Auth.: ORS 326.051, 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Stats. Implemented: ORS 341.626
Hist.: DCCWD 1-2012(Temp), f. & cert. ef. 7-17-12 thru 1-10-13; DCCWD 3-2012, f. & cert. ef. 12-26-12; DCCWD 3-2013, f. & cert. ef. 6-11-13

589-002-0120

Community College Support Fund Distribution Methodology

(1) The Community College Support Fund shall be distributed in equal payments as follows:

(a) For the first year of the biennium, August 15, October 15, January 15, and April 15;

(b) For the second year of the biennium, August 15, October 15, and January 15;

(c) The final payment of each biennium is deferred until July 15 of the following biennium as directed by the 71st Oregon Legislative Assembly.

(d) Should any of the dates set forth above occur on a weekend, payment shall be made on the next business day.

(e) All payments, made before actual property taxes imposed by each district are certified by the Oregon Department of Revenue, shall be based on the department's best estimate of quarterly entitlement using property tax revenue projections. Payments shall be recalculated each year as actual property tax revenues become available from the Oregon Department of Revenue and any adjustments will be made in the final payment(s) of the fiscal year.

(2) Community college districts shall be required to submit enrollment reports in the format specified by the Commissioner, including numbers of clock hours realized for all coursework, in a term-end enrollment report by the Friday of the sixth week following the close of each term. If reports are outstanding at the time of the quarterly payments, payment to the district(s) not reporting may be delayed at the discretion of the Commissioner.

(a) All payments, made before actual Full-Time Equivalent student enrollment data are available shall be based on the department's best estimate of quarterly entitlement using student enrollment data from previous years.

(b) Payments shall be recalculated each year as Full-Time Equivalent student enrollment data become available and any adjustments will be made in the fiscal year.

(3) Reimbursement from the Community College Support Fund shall be made for career technical, lower-division collegiate, developmental education and other courses approved by the State Board in accordance with OAR 589-006-0100 through 589-006-0400. State reimbursement is not available for hobby and recreation courses as defined in 589-006-0400.

(4) Residents of the State of Oregon and the states of Idaho, Washington, Nevada, and California shall be counted as part of each community college district’s CCSF reimbursable FTE, but only for those students who take part in coursework offered within Oregon's boundaries.

(5) State funding for community college district operations is appropriated by the legislature on a biennial basis to the Community College Support Fund. The amount of state funds available for each biennium and for distribution through the funding formula shall be calculated based on the following:

(a) Funds to support services provided to inmates of state penitentiary and correctional institutions by community college districts shall be subtracted from the amount allocated to the Community College Support Fund before the formula is calculated. The amount available for services provided to inmates shall be equal to the funding amount in the preceding biennium, except as adjusted to reflect the same percentage increase or decrease realized in the overall Community College Support Fund appropriation. The distribution method of CCSF funding for individual state penitentiary and correction institution programs provided by community college districts will be determined in consultation between the agency and the Department of Corrections.

(b) Funds to support contracted out-of-district (COD) programs described in OAR 589-002-0600 shall be subtracted from the amount allocated to the Community College Support Fund before the formula is calculated.

(A) A community college district providing contracted out-of-district services will receive an allocation equal to the college's number of reimbursable COD FTE multiplied by the statewide average of non-base community college support funds per total funded FTE. The average funds per total funded FTE is based on the same year COD services are provided.

(B) The allocation is distributed after the reimbursable COD FTE has been reported to CCWD for the full academic year. An adjustment to the allocation may be made if the final audited FTE is significantly different than the COD FTE from which the allocation was made.

(C) Beginning July 1, 2014, to be eligible for a COD allocation, each participating community college district must:

(i) Provide the department with a copy of the agreement between the community college district and the local participating entity by October 1st of each service year.

(ii) Enter into a contract with the department by January 1st of the service year for a COD allocation payment.

(iii) Follow all requirements found in OAR 589-002-0600.

(D) Section (5)(b)(A) and (B) of this rule applies to COD contracts that were in effect starting with the 2012–13 fiscal year.

(c) Funds to support targeted investments such as distributed learning shall be subtracted from the amount allocated to the Community College Support Fund before the formula is calculated. The amount available for these investments shall be equal to the funding amount in the preceding biennium, except as adjusted to reflect the same percentage change to the current biennium’s total Community College Support Fund appropriation.

(d) Funds remaining in the Community College Support Fund shall be distributed through the formula as described in Section 6.

(e) State general fund and local property taxes for territories annexed or formed effective June 1, 1996 or later shall not be included in the funding formula for the first three years of service. Additionally, the FTE generated in newly annexed territories shall not impact the funding formula during the first three years of service. Beginning in the fourth year, funding will be distributed through the formula as outlined in this rule.

(6) Distribution of funds to community college districts from the Community College Support Fund shall be accomplished through a formula, based on the following factors:

(a) Base Payment: Each community college district shall receive a base payment of $720 for each Weighted Reimbursable FTE up to 1,100 and $360 per FTE for unrealized enrollments between actual Weighted Reimbursable FTE and 1,100 FTE. The base payment for each community college district will be adjusted according to the size of the district. Community college district size for purposes of this adjustment will be determined each year by the FTE set forth in section (8)(b) of this rule. The base payment adjustments shall be:

(A) 0 – 750 FTE 1.3513;

(B) 751 – 1,250 FTE 1.2784;

(C) 1,251 – 1,750 FTE 1.2062;

(D) 1,751 – 2,250 FTE 1.1347;

(E) 2,251 – 2,750 FTE 1.0641;

(F) 2,751 – 3,250 FTE 1.0108;

(G) 3,251 – 3,750 FTE 1.0081;

(H) 3,751 – 4,250 FTE 1.0054;

(I) 4,251 – 4,999 FTE 1.0027;

(J) 5,000 or more FTE 1.000.

(b) Student-Centered Funding: The formula is designed to distribute the Community College Support Fund based on each community college district’s FTE.

(A) The equalized amount per FTE is determined by dividing Total Public Resources — excluding base payments, contracted out-of-district payments, and any other payments directed by the State Board or the legislature — by funded FTE. The department shall make the calculation based on submission of FTE reports by community college districts and in accordance with established FTE principles.

(B) To determine the number of funded FTE for each community college district, a three-year weighted average of fundable FTE for each community college district will be used with the first year prior to current fundable FTE weighted at 40%, second year prior to current fundable FTE weighted at 30%, and third year prior to current fundable FTE weighted at 30%.

(c) Beginning with the 2011-13 biennium, a Biennial Growth Management Component is added to the calculation of each community college district’s funded FTE. The purpose of the Biennial Growth Management Component is to manage the level of total public resource available per FTE within the total public resources available.

(A) The methodology for calculating the base year and subsequent biennial growth management component is displayed in Table 1 “Community College Support Fund Growth Management Calculation Tables” and is available through the following hyperlink. [Table not included. See ED. NOTE.]

(B) The calculations that will implement the Growth Management Component in the CCSF Distribution Formula Model are available in Table 2. Formula Calculation of Fundable FTE by Community College District.” [Table not included. See ED. NOTE.]

(C) The State Board of Education (SBE) has authority, on a biennial basis to, set the “quality growth factor” that may increase or decrease the number of FTE that will be counted for funding purposes above or below the Biennial Growth Management Component. The SBE will consider the following principles as guidelines for setting the “quality growth factor”:

(i) Balance the desire to support growth beyond that which is funded through the funding formula distribution model with the desire to enhance quality by increasing the level of funding provided on a per-student FTE basis.

(ii) The Total Public Resources (TPR) per FTE should not erode by more than 5% on an annual basis.

(iii) Where current TPR per FTE is determined to be insufficient to support the “quality of education” desired, a growth factor could be established that would increase the TPR per FTE.

(iv) If revenue is significantly reduced during a biennium, the Board may reduce the “quality growth factor.”

[ED.NOTE: Tables referenced are available from the agency.]

Stat. Auth.: ORS 326.051, 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Stats. Implemented: ORS 341.626
Hist.: DCCWD 1-2012(Temp), f. & cert. ef. 7-17-12 thru 1-10-13; DCCWD 3-2012, f. & cert. ef. 12-26-12; DCCWD 3-2013, f. & cert. ef. 6-11-13; DCCWD 6-2013(Temp), f. & cert. ef. 12-16-13 thru 6-13-14

589-002-0130

State Board Strategic Fund

The State Board may establish a strategic fund.

(1) There are two basic categories for these funds: incentivized statewide initiatives and activities, and requests from individual districts for assistance in meeting new requirements and expectations stemming from legislative change.

(2) The commissioner will use a committee of stakeholders and department staff to determine overall priorities for funding that considers the State Board work plan and initiatives.

(3) Strategic funds provided to incentivize statewide activities or assist community colleges in meeting legislative expectations are provided only for the biennium in which funding is approved. Strategic Funds allocated for either purpose will not be considered in the distribution of funds through the formula described in Section 6 of 589-002-0110 for the current biennium or future biennia.

(4) Any unused monies remaining in the current biennium's strategic fund will be allocated through the formula described in Section 6 of 589-002-0110 at the end of the biennium.

(5) The commissioner will review, rank and approve proposals to incentivize statewide activities. After each proposal is approved, the commissioner will provide the State Board with a report detailing the purpose of the activity, the amount of strategic fund monies approved, and the proposal's merit as assessed under the following parameters:

(a) Purpose of the proposal.

(b) How the activity supports the initiatives and work plans of the department and the State Board.

(c) How the activity relates to the department‘s Key Performance Measures or other program-specific measures.

(d) If the funding one time (for this biennium) or will additional funding be needed in the future.

(e) If future funding is needed, how resources will be obtained and how the activity will be sustainable?

(f) The activity's impact on the state three years from now and five years from now.

(g) Anticipated changes.

(h) How progress will be measured.

(f) The department will bring all requests for assistance in meeting new requirements or expectations stemming from legislative change to the State Board for discussion and consideration.

(g) The department will assess the requests for assistance in meeting new requirements or expectations of the legislature based on the following parameters:

(A) Purpose of the proposal.

(B) How funds will be used to sustain or increase enrollment (not supplanting existing funds).

(C) If the funding is one time (for this biennium) or if additional funding will be needed in the future.

(D) If future funding is needed, how those resources will be obtained and how the activity is sustainable.

(E) The impact on the community college three years from now and five years from now.

(F) How progress will be measured.

(h) The department will provide a recommendation and reasoning to the State Board on whether the request merits funding.

Stat. Auth.: ORS 326.051, 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Stats. Implemented: ORS 341.015, 341.022, 341.317, 341.440, 341.525, 341.528, 341.626 & 341.665
Hist.: DCCWD 1-2012(Temp), f. & cert. ef. 7-17-12 thru 1-10-13; DCCWD 3-2012, f. & cert. ef. 12-26-12; DCCWD 3-2013, f. & cert. ef. 6-11-13

589-002-0200

State Reimbursement and Student Residency

For the purposes of OAR 589-002-0100, Distribution of Community College Support Fund:

(1) "Permanent Residence" is defined as a person's home, to which one intends to return after any absence and in which one's dependents reside for an unlimited period of time. A permanent residence shall be verified by specific documentation. Such documentation may include, but is not limited to, copies of the Oregon Department of Revenue income tax statements; deeds, bills of sale or other papers indicating ownership by the student or a member of his or her family of the dwelling in which he or she resides; appropriate Department of Defense forms indicating that the student took residence in Oregon within one year of being released from active duty in the armed forces; possession of a driver's license issued by the State of Oregon; and evidence indicating that a parent or guardian of a dependent student qualifies as an Oregon resident under this rule.

(2) "Oregon Resident" is defined as a person who currently maintains a permanent residence in the state and whose permanent residence has been maintained in Oregon for no less that ninety continuous days immediately preceding the person's first instructional day of the term (quarter) for which residency is in question.

(3) Pursuant to ORS 341.528, and notwithstanding subsection (2) of this section, students who are residents of Idaho, Washington, California and Nevada and students admitted pursuant to ORS 351.647 shall be considered as residents of Oregon for the purpose of reimbursement.

(4) District policies regarding student residency for state reimbursement purposes may be subject to the periodic review and approval of the State Board of Education. In the event that approval is not granted, the State Board of Education may withhold reimbursement.

Stat. Auth: ORS 326.051 & ORS 341.626
Stats. Implemented: ORS 341.290(7), ORS 341.505, ORS 341.529 & ORS 341.626
Hist.: 1EB 9-1979, f. & ef. 6-11-79; EB 12-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0260; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0205; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

589-002-0300

Advanced Payment to Newly Created Community College District or Service District

A newly created community college district, or community college service district, shall be assigned by the State Board of Education a base allocation level for its initial year of operation, based on the projected budget requirements as set in the feasibility study approved by the State Board of Education. Payments to the new district for its initial year shall be based on the assigned base allocation. From operating funds available to the new district, the Commissioner may advance reasonable sums for organizational expenses. Such an advance may be made only after the new district has formally adopted a budget. An advance will not serve to increase eligibility for state operating funds; it is a partial payment of the sum due the new district from its assigned base allocation in its initial year of operation.

Stat. Auth.: ORS 326.051 & ORS 341.626
Stats. Implemented: ORS 341.626
Hist.: EB 14-1987(Temp), f. & ef. 7-30-87; EB 5-1988, f. & cert. ef. 1-14-88; EB 23-1989(Temp), f. & cert. ef. 6-12-89; EB 33-1989, f. & cert. ef. 11-28-89; EB 12-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0266; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0210; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

Community College Contracted Services
(State Reimbursement)

589-002-0500

Contracts with Agencies, Organizations, and Industries for Which State Reimbursement is Requested

(1) For the purposes of this rule, the following definitions apply:

(a) "Contract" is defined as an agreement between a community college and an agency, organization, individual, or industry to provide educational services, unless these services are prohibited by the Commissioner or state statute;

(b) "General fund revenue account" is defined as that account which includes all revenues related to the college's basic educational objectives. All revenues not included in some other specific fund accounts are included in the general fund revenue account. All revenues associated with the generation of reimbursable full-time equivalent students are included in the general fund revenue account;

(c) "Special revenue account" is defined as a fund used to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or for major capital projects) that are legally restricted to expenditure for specific purposes, including revenues from specific projects, grants, contracted out-of-district programs, restricted federal projects, and other contracts for designated purposes;

(d) General education purposes" is defined as those purposes directly associated with the college's basic educational objectives.

(2) When community colleges provide educational services through contracts with agencies, organizations, or industries for their clients and employees, the colleges are entitled to compensation for reimbursable costs as defined by the Department and these rules. The community colleges are responsible for maintaining records that justify their requests for reimbursement from the Department.

(3) Full-time equivalent (FTE) attributable to contracts which are accounted for in a college's general fund revenue account can be added to a college's reimbursable full-time equivalent (RFTE) base and are subject to the reimbursement formula in OAR 589-002-0100. Any funds received under the contract from the contracting agency, business, or industry are to be placed into the college's general fund revenue account, or into the college's special revenue account with the Commissioner's approval and must be used for general education purposes.

Stat. Auth.: ORS 326.051 & ORS 341.626
Stats. Implemented: ORS 341.626
Hist.: 1EB 11-1981, f. 5-6-81, ef. 5-7-81; EB 12-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0255; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0220; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

589-002-0600

Access by Unserved Areas to Community College Services; and Procedures for Contracted Out-of-District Areas

(1) For the purposes of this rule:

(a) "Nondistrict area" is defined as any geographic area of the state not within a community college district or community college service district;

(b) "Nondistrict student tuition" means tuition paid by residents of the nondistrict area;

(c) "Other nondistrict resources" means gifts, contributions, or grants from individuals, groups, organizations, businesses or industries. It may include financial support from school districts, education service districts, municipalities, counties or another public agency or private organization.

(2) Nothing in this rule is intended to refer to programs provided through contracts between community colleges and state correctional facilities. Those contracts are addressed in OAR 589-002-0700.

(3) Nothing in this rule is intended to refer to programs provided specifically for apprentices, including apprenticeship services as authorized in ORS 660.157(3). Those programs are addressed in division 11, chapter 589, of the Oregon Administrative Rules.

(4) The Department shall determine that sufficient interest exists in a nondistrict area for the formation of a local advisory committee to analyze and advocate community college services when it receives a petition signed by a minimum of 100 persons, or by five percent of the electors registered in each county or part of a county within the designated service area, whichever is less. The Department may ask the county clerk to verify valid petition signatures:

(a) The Department shall furnish the petition form and provide advice to the chief petitioner;

(b) In the event that more than one person seeks chief petitioner status, the Department shall select the party that, in its judgment, can best represent the diverse interests within the nondistrict area.

(5) Upon receipt of the petition, the Department and the chief petitioner shall jointly apply to the county governing body for the appointment of a local advisory committee. The application shall include the names of at least ten nominees agreed to by the Department and the chief petitioner along with brief statements as to the reasons they seek appointment.

(6) Upon application, the governing body of the county shall appoint a local advisory committee and shall insure that the committee is broadly representative of the nondistrict area.

(7) The advisory committee shall:

(a) Examine the educational needs of the residents;

(b) Identify financial and human resources necessary to meet the educational needs;

(c) Identify entities willing to contract with the community college provider;

(d) Promote the community college services desired;

(e) Periodically advise and consult with the designated staff of the contracting community college and the Department regarding services requested and provided; and

(f) Submit biennial evaluation reports to the county governing board, the Department, and the contracting community college. The Department may, at its discretion, require more frequent evaluation reports.

(8) Community college districts and community college service districts may submit proposals to the Department, to become service providers to a nondistrict area:

(a) The proposal shall address information sent by the Department to the colleges describing the boundaries of the nondistrict, the population base, and the services requested;

(b) The college district shall define the elements of its proposed contract including orientation, inservice, materials, recommended tuition and fees, registration and reporting procedures, transcription, advising, timelines, supervision, and budget;

(c) The Department shall select that college that, in its judgment, can best deliver the services requested:

(A) The Department shall make its judgment after considering geographic factors, prior service history, and local advisory committee preference;

(B) The community college district or community college service district selected to be the contractor shall enter into an agreement with the contracting entity;

(C) The agreement is subject to the approval of the State Board or its designee.

(9) The contract between the community college and the local contracting entity must include an annual budget setting forth both revenue and expenditures for services provided to the nondistrict area. The budget shall be based on the following conditions:

(a) The budget must be wholly supported by state funds, nondistrict student tuition, and other nondistrict resources;

(b) While the budget may contain some in-kind contribution from the nondistrict area, a cash contribution, exclusive of tuition, is required.

(10) State reimbursement of costs incurred in providing services subject to the contract will be made based on the formula described in OAR 589-002-0100. Contracts shall not imply any requirement on the part of the state for reimbursement beyond the amounts appropriated for such purposes or beyond the biennial period covered by any such appropriation.

(11) Nondistrict areas operating under contract to a community college district will be eligible for federal Adult Basic Education funds based on the distribution method described in the State Plan for Adult Education and adopted by the State Board.

(12) The cost of education (tuition and fees) to residents of the nondistrict shall be sufficiently low to enable students of low and middle income to attend.

(13) The local nondistrict financial effort shall be in cash:

(a) The contracting entities may exercise the option of increasing local effort in order to reduce tuition costs to students;

(b) The minimum cash contribution that will be required in the budget shall be determined in the following manner:

(A) For the initial contract year, not less than ten percent of the budgeted expenditures must be supported by a cash contribution;

(B) For the second contract year not less than 15 percent of the budgeted expenditures must be supported by a cash contribution;

(C) For the third contract year, and all subsequent years, not less than 20 percent of the budgeted expenditures must be supported by a cash contribution.

(c) Upon request from the college providing the contracted services, the Commissioner may recommend to the State Board a waiver or renegotiation of all or a portion of the matching requirement;

(d) A nondistrict area that contracts for not more than 12 FTE annually shall be subject to a separate cash contribution standard:

(A) Such areas may enter into contracts that provide for no cash contribution for the first three years of service;

(B) For the fourth, and all subsequent years, the cash contribution shall be ten percent of the budgeted expenditures.

(e) Cash may be from any source except that which is prohibited by rule or regulation.

(14) Contracts are subject to the review and approval of the Department:

(a) Contracts may be for one or two years and are renewable. Two-year contracts are subject to annual budget review and possible adjustment by the Department. The Department can choose to entertain bids from other potential contractors in the course of this review;

(b) Contracts will be submitted to the Department by July 1 of the contract year. The Department will determine that the contracting entity has met the cash requirement, that state-approved courses are offered, and that the district providing services provides adequate supervision of the contract;

(c) The Department will evaluate contracted out-of-district services biennially and submit a report to the State Board by May of even-numbered years. The evaluation will include number of individuals served, types of instructional services offered, extent to which the interest and needs of each area have been met, financial effort of each area, and projected service in the next biennium.

(15) The community college districts are responsible for developing the form of the contractual agreements and the method for recording them.

Stat. Auth.: ORS 326.051 & ORS 341.024
Stats. Implemented: ORS 341.019, ORS 341.021, ORS 341.022 & ORS 341.024
Hist.: 1EB 178, f. 10-18-74, ef. 11-11-74; 1EB 205, f. 8-20-75, ef. 9-11-75; 1EB 15-1985, f. 7-3-85, ef. 7-5-85; 1EB 178, f. 10-18-74, ef. 11-11-74; EB 21-1987(Temp), f. & ef. 10-7-87; EB 16-1988, f. & cert. ef. 3-15-88; EB 17-1988, f. & cert. ef. 3-15-88; EB 13-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0240 & 581-043-0250; EB 14-1992, f. & cert. ef. 5-13-92; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-042-0400; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

589-002-0700

Community College Services for Inmates of State Penitentiary and Correctional Institutions

(1) Community colleges and the Department may contract with the Department of Corrections for instructional services to inmates of any Department-operated correctional facilities.

(2) Any contract between the Department and the Department of Corrections (State Contract) may include agreements relating to all statewide staff training and development, program transferability between correctional institutions, curriculum planning, instructional support, evaluation and assessment, instruction of the persons with disabilities, employee relations, and the range of administrative allowances.

(3) Contracts between a provider community college and an individual correctional institution (Local Contracts) shall include agreements relating to specific administrative allowances, financial aid administration, program mix, staffing and budget:

(a) Each Local Contract shall indicate as its primary objective a functional literacy program; and as its secondary objective professional and technical education that provides entry-level, marketable skills;

(b) State reimbursement of costs incurred in providing services subject to the Local Contracts will be made based on the formula described in OAR 589-002-0100. Contracts shall not imply any requirement on the part of the state for reimbursement beyond the amounts appropriated for such purposes or beyond the biennial period covered by any such appropriation;

(c) Local Contracts will be eligible for federal Adult Basic Education funds based on the distribution method described in the State Plan for Adult Education and adopted by the State Board of Education.

(4) All local contracts are subject to prior approval by the Department and must be submitted prior to August 1 of each year, unless the contract is for a biennial period in which the contract must be submitted prior to August 1 of the biennial year.

(5) The Department will advise the Department of Corrections and colleges annually of adjustments in the allocation of funds appropriated for services in correctional institutions.

(6) The State Board of Education shall review services to correctional institutions at least once biennially. To facilitate this review and approval, Department shall evaluate the contracts with the Department of Corrections biennially and submit a report to the State Board of Education by May 1 of even-numbered years. The evaluation shall include the number of individuals served, types of instructional services offered, extent to which the interest and needs of inmates have been met, financial effort, and projected service in the next biennium.

Stat. Auth.: ORS 326.051 & ORS 341.626
Stats. Implemented: ORS 341.317
Hist.: EB 27-1987, f. & ef. 11-17-87; EB 13-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0251; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-042-0500; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

589-002-0800

Audit Procedures, Adjustments and Appeals

(1) Notwithstanding the required financial audit required under the Single Audit Act of 1984, P.L. 98-502, the Department and the State Board of Education have a statutory duty to manage public funds in a prudent manner. This duty includes the responsibility to take reasonable action to correct errors and to prevent the unauthorized use of public funds through the use of periodic audits.

(2) The Department may perform periodic on-site financial, performance and/or statistical audits of community colleges, community college service districts, other grantees, and contractors. The audits shall be conducted to determine compliance with applicable statutes and administrative rules, instructions, and grant and contract terms.

(3) Requests for audits may come from the State Board of Education, the Department, community colleges, contractors, or private citizens. Requests from anyone outside the Department must be routed through the Assistant Commissioner, be recommended by the Commissioner, and approved by the State Board of Education.

(4) The audit is to be performed by a person or persons with adequate technical training and proficiency as an auditor.

(5) The Auditor shall prepare a draft report of the audit and forward it to the audited agency with a letter of explanation. The letter will explain alternatives available to the agency in responding to the draft report. The audited agency's responses shall be forwarded within 60 days to the Auditor for evaluation in preparing the final audit report unless an alternative timeline is mutually agreed upon.

(6) After considering the responses, if any, from the agency on the draft audit report, the Auditor will prepare a final audit report. The Commissioner shall forward by letter the final audit report to the audited agency.

(7) Any exceptions involving overclaims (overpayments) or underclaims (underpayments) may be processed as follows unless the Commissioner agrees to an alternative method of adjustment:

(a) Overclaims: The agency will have the option of remitting the excess claim or reducing accordingly the subsequent year's entitlement;

(b) Underclaims: The subsequent year's claim may be adjusted by the amount underclaimed.

(8) The Auditor shall forward audit reports involving overpayment or underpayment to the Commissioner and to the audited agency.

(9) If the audited agency disputes the Department 's determination of an audit exception, the audited agency may appeal to the State Board of Education in the manner provided for a contested case under ORS 183.413 to 183.470. During an appeal, no action will be taken by the Department to effect reimbursement until a decision on the audit under appeal has been reached.

Stat. Auth.: ORS 326.051, ORS 341.015 & ORS 341.626
Stats. Implemented: ORS 291.200, ORS 341.015 & ORS 341.626;
Hist.: EB 12-1991, f. & cert. ef. 7-19-91; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0240; DCCWD 1-2003, f. & cert. ef. 1-9-03; DCCWD 5-2003, f. & cert. ef. 10-20-03

589-002-0900

Reporting Requirements

(1) Colleges are required to submit, on or before January 30 of each year, reports of the revenues and expenditures, classified according to the format supplied by the Department.

(2) Colleges are required to submit enrollment reports for fourth week estimates by Friday of the fifth week of each term, and a term-end enrollment report by Friday of the sixth week following the close of each term. If reports are outstanding at the time of the quarterly payments, payment to the college(s) not reporting may be delayed at the discretion of the Commissioner.

(3) Colleges are required to submit to the Department one copy of their final audits no later than January 2 of each year following the year for which the audits are conducted.

(4) Rules governing the classification of revenue and expenditure accounts for community colleges are contained in the Community College Accounting Manual published by the Department (latest edition). Budget documents and audit reports will conform to these rules. The State Board adopts this publication to fulfill its responsibilities by reference as set forth in ORS 294.356.

[Publications: The publication(s) referenced in this rule are available from the agency.]

Stat. Auth.: ORS 294.352, ORS 341.015 & ORS 341.626
Stats. Implemented: ORS 294.352, ORS 294.356, ORS 341.626 & ORS 341.709
Hist.: 1EB 5-1982, f. & ef. 2-10-82; EB 10-1987, f. & ef. 5-12-87; EB 14-1987(Temp), f. & ef. 7-30-87; EB 5-1988, f. & cert. ef. 1-14-88; EB 23-1989(Temp), f. & cert. ef. 6-12-89; EB 33-1989, f. & cert. ef. 11-28-89; EB 12-1991, f. & cert. ef. 7-19-91; Renumbered from 581-043-0265 & 581-043-0266; DCCWD 1-2001, f. & cert. ef. 3-21-01, Renumbered from 581-041-0250

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