Interim Joint Committee on Education


Minutes of the<MeetNo1> 4th Meeting

of the 2008 Interim


<MeetMDY1> September 8, 2008


The<MeetNo2> fourth meeting of the Interim Joint Committee on Education was held on<Day> Monday,<MeetMDY2> September 8, 2008, at<MeetTime> 1:00 PM, at Campbellsville University<Room>. Senator Ken Winters, Co-Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Ken Winters, Co-Chair; Senators Brett Guthrie, Alice Forgy Kerr, Vernie McGaha, R.J. Palmer II, Elizabeth Tori, and Johnny Ray Turner; Representatives Larry Belcher, Leslie Combs, Jim DeCesare, Ted Edmonds, C. B. Embry Jr., Bill Farmer, Tim Firkins, Jim Glenn, Jeff Greer, Jimmy Higdon, Reginald Meeks, Charles Miller, Harry Moberly Jr., Russ Mobley, Rick G. Nelson, Tom Riner, Carl Rollins II, Charles Siler, Dottie Sims, Alecia Webb-Edgington, and Addia Wuchner.


Guests:  Jo Carole Ellis and Mr. Edward Cunningham, Kentucky Higher Education Assistance Authority; Joe Lancaster, Office of State Budget Director; Dr. Gary Cox, President, Association of Independent Kentucky Colleges and Universities; Bill Huston, St. Catherine College; Dr. Michael Carter, President, Campbellsville University; Ms. Shajuana Ditto, President, Student Government Association, Campbellsville University; Jonathan Lowe and Greg Rush, LRC Budget Review; Faurest Coogle; LRC Senate Majority Leadership; Ruth Webb, LRC House Majority Leadership; John Chowning, Carol Sullivan, Joe Walters, Jeff Justice, C. Garrison, and N. Wheat, Campbellsville University; Kevin Brown, Frank Rasche, and Larry Stinson, Kentucky Department of Education; Dr. Richard Crofts and Dan Flanagan, Council on Postsecondary Education; Sharon Burton, Community Voice; Darryl McGaha, Lake Cumberland Area Development District; Mark Johnson, Campbellsville-Taylor County Economic Development Authority, and Ralph Tesseneer.


LRC Staff:  Audrey Carr, Sandy Deaton, Janet Oliver, Janet Stevens, Ken Warlick, and Lisa Moore.


Senator Winters asked for a motion to approve the minutes of the August 11, 2008, meeting. Upon a motion by Representative DeCesare, seconded by Senator McGaha, the minutes were approved by voice vote.


Senator Winters introduced Dr. Michael M. Carter, President, Campbellsville University, who welcomed the members and gave an overview of campus highlights. He introduced Ms. Shajuana Ditto, President, Student Government Association, who described her experiences on campus and explained why other Kentucky students should consider attending Campbellsville University. She thanked the legislative committee members for the General Assembly’s actions to contribute state funds into student financial aid to give more students the opportunity for postsecondary education.


Senator Winters gave special recognition to Representative Russ Mobley and asked his wife Carol Mobley and Dr. Carter to join Representative Mobley on stage. Senator Winters read a resolution in his honor and he received a standing ovation from committee members and guests. Representative DeCesare made the motion to accept the resolution, seconded by Representative Webb-Edgington. The motion to accept the resolution was approved by voice vote. Dr. Carter also presented Representative Mobley with a Distinguished Service Award on behalf of Campbellsville University.


Senator Winters gave special recognition to former Representative Frank Rasche, Co-Chair of the Interim Joint Committee on Education, and read a resolution in his honor. Representative Miller made the motion to accept the resolution, seconded by Representative DeCesare. The motion to accept the resolution was approved by voice vote.

Senator Winters introduced Dr. Richard Crofts, Interim President, Kentucky Council on Postsecondary Education (CPE), to review Executive Order 2008-836 relating to the CPE and to give an update on the presidential search process. Dr. Crofts said the committee searching for the new CPE President is working under very strict confidentiality rules in an effort not to lose good candidates as the process continues. The committee will begin reviewing resumes in the next ten days in an effort to identify the most nationally qualified candidates for this very important position. He said the committee hopes to have final interviews and a final selection by the first week in December of 2008. He also said the CPE Web site has a presidential profile of the position to help explain the desired attributes and qualifications to potential candidates.


Dr. Crofts explained the reasoning behind Executive Order 2008-836. He said the CPE applauds the action of administratively moving the agency and directly attaching it to the Governor’s office. He said House Bill 1 (2007 SS) identified the President of the CPE in statutory language as the higher education advisor for the Governor and the legislature, which is a huge statutorily enacted responsibility. The CPE and the Governor feel the Governor’s office plays a significant role in higher education issues nationally as well as within the Commonwealth and both felt the move would help in the recruitment of the permanent president.


Representative DeCesare said he did not have a problem with the executive order, but noted that the executive order does not state that the CPE reports to the General Assembly.


Representative Rollins asked if this executive order changed the structure of the CPE prior to any changes made by the last administration. Dr. Crofts said the only difference in the structure under the new executive order is the way it references the Secretary of the Cabinet.


Senator Winters said he was disappointed when Governor Fletcher moved the CPE under the Education Cabinet by executive order. He feels the CPE is most effective when it is attached directly to the Governor’s office and he applauds the decision.


The Chairman accepted the report on behalf of the committee.


Senator Winters introduced Dr. Phil Rogers, Executive Director, Educational Professional Standards Board, who explained 16 KAR 5:020, Standards for admission to educator preparation. Dr. Rogers said the administrative regulation removes tests that are no longer offered by the testing service and updates testing terminology and aligns regulatory language with current policy. There were no questions for Dr. Rogers from committee members.


The Chairman accepted the administrative regulation on behalf of the committee.


Senator Winters asked Mr. Kevin Brown, General Counsel, and Mr. Larry Stinson, Associate Commissioner, Office of District Support Services, Kentucky Department of Education (KDE), to explain 702 KAR 3:270, Support Educational Excellence in Kentucky (SEEK) funding formula. He said the amendment provides clarification on definitions of the components used in the SEEK funding formula. He said a change was made to the regulation in the August 2008 Kentucky Board of Education meeting that eliminated duplicative budget language and provisions already covered in other statutes. The remaining changes include adding clarity to some definitions in the funding formula and the addition of students with limited English proficiency being included in the SEEK formula.


The Chairman accepted the regulation on behalf of the committee.


Senator Winters introduced Ms. Jo Carole Ellis, Vice President, Government Relations and Student Services, Kentucky Higher Education Assistance Authority (KHEAA), who explained 11 KAR 3:100, Administrative wage garnishment. Ms. Ellis said the administrative regulation establishes procedures for KHEAA to garnish a defaulted student loan borrower’s wages for payment of the borrower’s student loan debt as well as the procedures for a borrower to request a hearing on a garnishment and procedures for conducting that hearing. She said this amendment will reflect the current poverty level and consumer expenditures figures published by the federal government.  


The Chairman accepted the regulation on behalf of the committee.


Senator Winters introduced Mr. Edward Cunningham, Executive Director and CEO, KHEAA, to give an update on student loan financing in Kentucky. Mr. Cunningham said the Kentucky Higher Education Student Loan Corporation (KHESLC), also known as The Student Loan People, is Kentucky’s state-created, non-profit student loan provider. KHESLC has funded approximately 70 percent of the Federal Family Education Loan Program (FFELP) loans in Kentucky, which is equivalent to $400 to $500 million for both first-time and continuing college students.


Mr. Cunningham said Congress took action last fall to reduce the federal income earned by lenders from FFELP student loans in an attempt to reign-in the major for-profit lenders. Their actions reduced income for all lenders, including not-for-profits like KHESLC. He said this reduction in revenue, combined with other recent actions taken by the United States Department of Education (USDE), forced KHESLC to discontinue the generous borrower benefits offered to Kentucky teachers, nurses, and public service attorneys as well as other benefits to students.


Mr. Cunningham said beginning in late 2007, the credit markets began to dislocate. The disruption in credit markets led to auction rate security failures in early 2008, and no student lender could sell bonds to raise capital to make new student loans. He noted without this traditional funding source, lenders scrambled to find additional sources. KHESLC was able to use available resources to make loans until May 1, 2008. At that time new loans were suspended until July, affecting mostly students attending summer school.


Mr. Cunningham said on May 7, Congress passed the Ensuring Continued Access to Student Loans Act, which provided availability to funding through the USDE. He said the new liquidity program is temporary and requires significant resources, such as bridge financing, in order to first make student loans and then recycle the funds for future loans. With limited resources, this program was still problematic for KHESLC, and it was uncertain if Kentucky could participate. He noted many lenders could not and have stopped making loans or have gone out of business.


Mr. Cunningham said the Commonwealth of Kentucky provided the critical bridge funding financing by purchasing a $50 million private placement bond from KHESLC. This innovative solution provides an adequate return on investment for Kentucky and allows KHESLC to continue to serve Kentucky students and families as well as our colleges and universities.


Mr. Cunningham said the USDE liquidity program is temporary and expires in September 2009 and is a one-year fix. KHESLC will continue to seek solutions to the student loan financing problem at the federal level and is asking Congress to either extend the temporary liquidity program or provide a more permanent financing solution for non-profit student lenders. He feels the credit markets will not stabilize at least until 2010 or 2011.


Senator Winters said it was important for the committee members to be familiar with the Association of Independent Kentucky Colleges and Universities (AIKCU) and understand the role and impact of independent institutions in the higher education system. He asked Dr. Carter to speak to the members about the uniqueness of campus life at Campbellsville University.


Dr. Carter used a Power Point presentation for the committee highlighting Campbellsville University.  He said the university is operating in its 102nd year and he has served as President for the past ten years. He noted that “US News & World Report” ranked Campbellsville University as being the 22nd best baccalaureate college in the South.


Dr. Carter said Campbellsville University describes itself as a private school with a public purpose. He said a recent economic impact study conducted by an independent firm showed that the college generated $76 million in economic development in Taylor County alone. He said the university offers 15 master’s degree programs, 43 baccalaureate programs, and 15 associate certificate degree programs. The student-to-faculty ratio is 13 to 1 and nearly 70 percent of the professors hold a Ph.D. or higher in their respective fields of study.


Dr. Carter said the tuition at Campbellsville University is in the median national average at $17,500 a year. He said financial aid is available in the form of grants, scholarships, loans, and work-study programs. He noted that 90 percent of all students at the university receive some type of financial aid.


The entire Power Point slideshow about Campbellsville University is located on a DVD in the meeting folder in the Legislative Research Commission (LRC) library.


Representative Riner thanked Dr. Carter and his outstanding faculty for the partnership that Campbellsville University has established with Simmons University in Louisville. Dr. Carter said the university is very proud of that partnership and opening pathways to education by removing barriers is something the university believes in.


Representative Higdon said Campbellsville University is very important to this region of the state and not only excels in education, but is instrumental in economic development and quality of life issues. He also said the Hartland Parkway project will be very beneficial to the people of the region and he is glad to have worked with Dr. Chowning on the project.


Representative Greer complimented Ms. Ditto on her student government work. He asked how many high schools the university works with on the Advanced Placement (AP) program to assist high school students in receiving college credit.


Dr. Carter said Campbellsville University is active in the AP and dual enrollment programs and currently participate with 26 schools across the state. He said both programs are designed to help the attendance in postsecondary education. He said the advantage of the dual enrollment program over the AP program is that the courses must be taught by a master’s level, Southern Association of Colleges and Schools (SACS) certified faculty member and that benefits those students enrolled in dual enrollment courses. He said both programs give a chance for students to be successful in high school and that success carries over into their college career.  


Dr. Winters discussed the Fruit of the Loom layoffs in the Campbellsville area years ago. He said 3,800 jobs were lost to the area when the company was moved offshore. He commended Campbellsville University for helping about 300 of the displaced workers by giving them a college education at no cost. He said the university was instrumental in providing the workers with retraining as well as spiritual and emotional healing.


Senator McGaha said he is concerned with drop-out rates in the K-12 system as well as retention rates in postsecondary education institutions. He asked Dr. Carter if Campbellsville University had any statistics for retention rates at its school or for private institutions as a whole.


Dr. Carter said Campbellsville University tends to have higher retention and graduation rates. He said there is probably a multitude of factors that contribute to the higher rates, but a low teacher to student ratio helps private schools retain their students by providing more one-on-one instruction. He also said there is an emphasis at the university to teach math, science, and writing. He feels there is a crisis today in trying to teach students writing skills. He said Campbellsville University has implemented the Writing Engagement Learning (WEL) program in an effort to focus on writing because research has shown that students who are good writers have better critical thinking skills, are better problem-solvers, and possess better verbal skills. He also noted that Campbellsville tends to focus on retaining sophomores as research has shown that more sophomores tend to drop-out of college than freshmen. He also said remedial education is a huge problem and students need to come to college better prepared to learn.


Representative DeCesare said that schools are not teaching spelling or the basics of grammar and this is trickling down to freshman enrolling into college. He asked Dr. Carter if Campbellsville University addresses the issue.


Dr. Carter said that writing across the curriculum remains a problem in Kentucky schools. He feels it is not in the best interest of the Commonwealth to graduate students who cannot communicate in a stable manner. He said Campbellsville University’s  writing program is designed to very intensively make sure that general education courses effectively teach writing.


Senator Winters introduced Dr. Gary Cox, President, AIKCU, to explain the economic and community impact of the independent institutions in the Commonwealth of Kentucky. Dr. Cox gave a Power Point presentation to the committee highlighting the AIKCU achievements. He said there are 20 nonprofit, independent colleges and universities and all are accredited by the SACS. They meet the same rigorous quality standards as Kentucky’s public colleges and universities.


Dr. Cox said there are 29,000 students enrolled in AIKCU and 75 percent of the students are Kentucky residents. The AIKCU offers diverse campuses, missions, and student bodies. The campuses are located across the state and offer a number of extended sites, partnerships with businesses and the Kentucky Community and Technical College System (KCTCS), international sites and study abroad, and online courses. The independent institutions are regional and local stewards, and all are committed to the goal of doubling the number of students attending college by 2020.


Dr. Cox said the independent institutions are affordable and accessible for students. The average tuition is one-third lower than the national private college average, and one-fourth lower than the Southern private college average.


Dr. Cox noted that the independent institutions are a tremendous return on a small state investment. Only about four percent of Kentucky’s total postsecondary spending goes to students attending Kentucky’s independent colleges and universities, all in the form of student aid. In return, Kentucky’s independent institutions produce 22 percent of Kentucky’s bachelor degrees; produces more than 5000 total degrees annually; produces high percentages of bachelor’s degrees crucial to Kentucky’s futures like math and science, education, and nursing; and provides bachelor’s degrees in many underserved parts of the state. He also said that substantial increases in state student aid over the last ten years have allowed independent institutions to serve more Kentucky students, but there are still Kentucky students with unmet need.


Dr. Cox said Kentucky students receive $53 million in student aid. He said that 97 percent of full-time, first-time independent institution students receive financial aid, and the average financial aid awards by source are relative to average tuition and fees. He noted that Kentucky contributes no funding for the 7,000 out-of-state students who attend the independent institutions and those students contribute to the local economies throughout the academic year and many stay in Kentucky after they graduate.


Dr. Cox said the independent institutions produce more than twice as many graduates in health sciences than in history. He noted over 300 nurses were produced in 2006-2007.


Dr. Cox summarized by explaining the return on investment that independent institutions provide for the Commonwealth of Kentucky. Highlights include: 100,000 alumni in Kentucky generate $4 billion in annual earnings and $416 million in state tax revenues; campuses provide more than $1.1 billion in educational facilities; combined total annual economic impact of more than $1.4 billion and creating more than 12,000 jobs in Kentucky; and being committed partners in Kentucky’s effort to double the numbers of bachelor degree holders by 2020.


Senator Winters said the next meeting of the Interim Joint Committee on Education will be on October 13, 2008, at the Gatton Academy of Mathematics and Science at Western Kentucky University in Bowling Green, Kentucky.


Representative Combs said she has spent over 20 years of her life creating and defending the statistics that Dr. Cox referred to in the meeting. She said the independent colleges have accomplished so much and in so many diverse areas in Kentucky. She said a good medical facility can be created without it having to cost multi-millions and produce excellent doctors.


With no further business before the committee, the meeting adjourned at 3:00 p.m.