SEATTLE — A special task force Monday offered a recipe for stabilizing funding of the state’s universities containing a key ingredient lawmakers have been reluctant to try.

The panel, which included Everett Mayor Ray Stephanson, called on the Legislature to allow four-year univers

ities to set their own tuition under a formula that would allow those fees to rise and fall with fluctuations in aid from the state.

It also recommended creation of a statewide scholarship fund and set of goal of raising $1 billion in the next decade to support low- and middle-income students. Major corporations should be offered future tax credits in exchange for hefty contributions, the group suggested.

Gov. Chris Gregoire pulled together the group of 16 business, government and education leaders to help her deal with a higher education system reeling from deep budget cuts.

Stephanson said the Higher Education Funding Task Force devised what members think provides universities with the tools to cope with declining state revenue and prepare for future fiscal challenges.

“Did we find a silver bullet for solving higher education funding problems now and forever? I think the answer is no,” said Stephanson, who was the only government official on the panel.

“We’re finding practical and pragmatic ways to address some of the short-term revenue needs through tuition-setting authority and to address the long term demands for scholarship funding through the endowment,” he said.

Microsoft Corp. executive Brad Smith led the group, which also included executives from Alaska Air and the Boeing Co. Members met privately six times since July to brainstorm and decide which recommendations to give the Legislature. State law didn’t require the group to hold public meetings because it was not given a task by the Legislature.

The proposed tuition-setting freedom would be part of a complicated formula that would allow universities to set tuition rates based on state budget contributions to higher education.

University leaders have asked for more flexibility to help them control their own budgets.

The Washington Pledge Scholarship Program would seek to collect $1 billion over the next decade from individual donors and businesses. To attract corporate donations, the task force wants to give businesses a state tax credit once the state’s budget stabilizes.

To improve the state’s efficiency at granting college degrees, the task force recommends an incentive program that would give money to colleges and universities that meet graduation goals. It would also like to see colleges focus on student retention.

“We believe that the current economic challenges facing the state underscore the need for a new long-term plan,” Smith said at a news conference Monday.

Now lawmakers will decide whether to consider the task force’s proposals and whether they will be proposed as bills.

Rep. Larry Seaquist, incoming chairman of the House Higher Education Committee, said he was impressed by the task force’s suggestions and expected the tuition proposal to get a good hearing in the Legislature despite the failure of a similar proposal last year.

Gregoire told a group of kids, parents and task force members gathered at a Seattle middle school that she was delighted with the recommendations. She said she would do whatever she could to encourage the Legislature to consider them during its 2011 session, even though she’s expecting it to be a tough session.

Stephanson and Smith said the task force members also planned to advocate for their ideas in Olympia.

The task force expanded its assignment to include ways to increase the number of college degrees in science, technology, engineering and mathematics. Members also concluded the state should, by 2018, award at least 19 percent of bachelor’s degrees to students from ethnic groups that have not been well represented on college campuses.

The task force suggests combining these goals by making the new scholarship fund give consideration to students seeking science or technology degrees.

A list of various other money saving ideas concluded the task force’s report. These include:

•Eliminate under used majors and courses;

Offer more online classes, particularly for large introductory courses;

Create three-year bachelor degree programs;

Limit state support for students taking credits beyond what they need to earn a degree;

Test students on prior learning experiences and give them credit;

Recognize college work done during high school.

Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.