State board approves FY2027 operating budget and adopts new allocation model
June 04, 2026 | Board Council Commission Agencies , Executive, Washington
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The State Board for Community and Technical Colleges voted to adopt the FY2027 operating budget and enrollment allocation (Resolution 26‑0‑6‑26), implementing a new allocation model that shifts how $1,243,000,000 in operating funds are distributed to colleges.
State board staff, led by Executive Director Nate Humphrey and presenter Stephanie, summarized how the legislature’s 2026 supplemental budget changed distribution mechanics and described the funds that are set aside before model distribution: legislative provisos and state board earmarks, a four‑year “safe harbor” set‑aside for compensation and new facility costs, state board operations and central services billing, and a small system reserve. After those holds, $761,300,000 (61%) flows through the allocation model, divided among a minimum operating allocation, a four‑year rolling average enrollment allocation (excluding international, corporate and continuing‑education enrollments), priority enrollments (basic education for adults and a skills‑gap list) and performance funding (a student‑achievement initiative).
Staff explained two 5% set‑asides from the operating pot: one for performance funding (student achievement metrics such as gateway math completions and credentials) and one for priority enrollments, split evenly between basic education for adults and designated skills‑gap programs. For the enrollment calculation the board used enrollments from academic years 2020–21 through 2024–25.
Board members and staff acknowledged the change is largely a reallocation of existing resources rather than a net increase: staff estimated a modest year‑over‑year rise (about $21 million, or 1.75%), but emphasized that several offsets and proviso reassignments mean few new investments. Members questioned how the model affects rural and small colleges, the regional concentration of skills‑gap funding (noting a higher concentration in King County), and the transparency of earmarks and provisos. Staff said the model will be evaluated on a scheduled cadence (beginning fiscal 2028 for the skills‑gap component) and that presidents and chancellors had recommended the model.
Several public commenters, including faculty and community members, urged the board to consider program classification and local impacts before allocations are finalized. The board discussed evaluation timelines and directed staff to provide additional breakdowns (for example, federal and foundation flows that do not pass through the state board). The resolution was moved, seconded and approved during the meeting.
The board also approved a consent item amending the executive director contract to add a 2% general wage increase effective July 1, 2026.
State board staff, led by Executive Director Nate Humphrey and presenter Stephanie, summarized how the legislature’s 2026 supplemental budget changed distribution mechanics and described the funds that are set aside before model distribution: legislative provisos and state board earmarks, a four‑year “safe harbor” set‑aside for compensation and new facility costs, state board operations and central services billing, and a small system reserve. After those holds, $761,300,000 (61%) flows through the allocation model, divided among a minimum operating allocation, a four‑year rolling average enrollment allocation (excluding international, corporate and continuing‑education enrollments), priority enrollments (basic education for adults and a skills‑gap list) and performance funding (a student‑achievement initiative).
Staff explained two 5% set‑asides from the operating pot: one for performance funding (student achievement metrics such as gateway math completions and credentials) and one for priority enrollments, split evenly between basic education for adults and designated skills‑gap programs. For the enrollment calculation the board used enrollments from academic years 2020–21 through 2024–25.
Board members and staff acknowledged the change is largely a reallocation of existing resources rather than a net increase: staff estimated a modest year‑over‑year rise (about $21 million, or 1.75%), but emphasized that several offsets and proviso reassignments mean few new investments. Members questioned how the model affects rural and small colleges, the regional concentration of skills‑gap funding (noting a higher concentration in King County), and the transparency of earmarks and provisos. Staff said the model will be evaluated on a scheduled cadence (beginning fiscal 2028 for the skills‑gap component) and that presidents and chancellors had recommended the model.
Several public commenters, including faculty and community members, urged the board to consider program classification and local impacts before allocations are finalized. The board discussed evaluation timelines and directed staff to provide additional breakdowns (for example, federal and foundation flows that do not pass through the state board). The resolution was moved, seconded and approved during the meeting.
The board also approved a consent item amending the executive director contract to add a 2% general wage increase effective July 1, 2026.
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