The second piece of very good news is that Weyerhauser Corporation is making a gift of $50,000 to our High School Connections program. This support is appreciated, particularly for the Regional Technical Education Consortium program. You are aware that we have developed this program without any new general funds. We have relied on repurposing funds, grant funds, and such. This gift will really help the college and, more importantly, will help the many high school students who need access to career and technical education.

The third piece of good news is that KLCC has received two significant grants this week. The Meyer Memorial Trust has given us $250,000 and the James and Marian Miller Foundation has given us $100,000. We still have a proposal pending with another foundation, but as it stands we are within $350,000 of our goal. We are very grateful to both of these foundations for their support.

The fourth piece of good news is that this week we are hosting Mr. Mohamed Rashidi, our partner in our endeavors in Egypt and the United Arab Republic. We are honored to have him with us.

That was the good news. Let me move back to the legislative session and the budget.

You may have followed in the newspaper the discussions about the corporate kicker and the corporate minimum. It started with a vote in the House defeating a one-year elimination of the corporate kicker. The following day a comprehensive bi-partisan deal was made regarding the kicker and the minimum. It was announced with great fanfare by the House and Senate leadership. The following week, the deal fell apart. They have agreed to eliminate the corporate kicker for one year to create a rainy day fund. There is no agreement on the corporate minimum, which causes a problem since the Opportunity Grant, Pre-K and the Skill-Up workforce activities were to be funded from this source.

The March revenue forecast was up slightly—$34 million, but in a $15 billion budget that is not much.

We are still working very hard with legislators around the $529 million target for community colleges. I believe that our delegation is on board with that. I have contracted Sandy Cutler to be our legislative liaison. He is working on generating at least one hundred letters from businesses to our delegation and the co-chairs of Ways and Means. However, the failure to deal with the corporate minimum and the lack of additional revenue makes our job very difficult. The co-chairs will publish their budget within the next couple of weeks, but budgets will not move until after the May forecast.

What does this mean for us?

First, I need to tell you that our health insurance rates are not looking good for next year. In spite of our best efforts, we have about 25 people who have had very high claims, and that has put our claims to premiums at 110 percent. This could result in increases anywhere from 13 to 25 percent. We have 6 percent in the projections, so that results in around a $1 million increase to our deficit.

The Budget Review Group (BRG) is in the last stages of the work, but it looks like we will need to go deeper than the proposals that came from divisions and departments. I will be reviewing the recommendations from the BRG in the next couple of weeks, and we need to be ready to start talking about reductions by the April board meeting. Your guidance as you discuss the Fiscal Sustainability paper will be invaluable.

In the meantime, I was able to provide an overview of Lane to the Education Subcommittee, met with the director of Oregon Economic and Community Development Department to discuss the Small Business Development Center budget, testified on the Skill-Up bill and attended the Adult Basic Skills Day at the Capitol. I presented state leadership awards to two faculty, who happened to be Lane faculty—Dennis Clark and Mary Faust. The governor helped me present the awards.

Our enrollment figures for fall term look good. We show an increase of 4.2 percent for fall term. Winter is looking flat, but we do not have final figures yet.