Regents revising university funding process
Marsha Sills
August 10, 2004
LAFAYETTE? Beginning next year, the Board of Regents plans to place different values on higher education by revising the way two- and four-year schools are funded by the state.
Currently, the state uses a formula based primarily on Southern Regional Education Board data comparing how other states are funding schools most similar to Louisiana?s institutions.
The board is considering an incentive-designed formula with incentives for?better behavior? such as improved retention, focus on keeping students enrolled, enrolling the appropriate mix of graduate and undergraduate students.
?It?s a results-oriented formula,? said Joseph Savoie, higher education commissioner.?It focuses more on outputs than inputs. The old approach (was) if you enroll students, you get x amount of dollars. Now, if you enroll them you get some money, but if you graduate them, you get more.?
Improving the state?s graduation rate is the driving force behind the revisions, Savoie said.
The reimbursement rate per student will increase as the student advances in study. A freshman will be worth less than a junior and a graduate will be worth more than an undergrad.
In part, the idea is to improve student transition from a two-year and four-year school, said Donnie Vandal, deputy commissioner for administration.
Next year, the state will raise admission requirements for all four-year schools. The state hopes students who would typically enter four-year schools before the new requirements will shift to the community college system, helping to balance the overall budget for higher education, Vandal said.
?It?s more expensive to have a student in a four year than a two year,? Vandal said.?The more students we can move to the two year setting, the more cost effective our (funding) becomes.?
Part of the problem has been that the state didn?t have a well-developed community college system. If someone wanted to go to college, four-year was their only option.
?That meant that a lot of students started (four-year) and didn?t make it through. Graduation rates were poor,? Vandal said.?We had a problem with retention of students not being addressed appropriately.?
There was also too much development programs or remedial courses in four-year schools, he said.
?Now that we?re developing a better two-year system, that?s where open access is designed to be,? Vandal said.
The board doesn?t see the funding formula changes as its cure-all for deficits in higher education funding. The state is about $230 million behind the SREB average, Vandal said.
The SREB places schools in categories or tiers, based on its range of programs and amount of production and degrees awarded across a spectrum of programs.
In Louisiana, LSU is the only Category 1 institution, with at least 100 doctoral degrees awarded in at least 10 major disciplines. In order to be recognized as a Category 1 school, no more than 50 percent of the degrees may be awarded in one discipline. Auburn University, the University of Florida and Texas A&M;are considered LSU?s peers.
The University of Louisiana at Lafayette and the University of New Orleans are both Category II institutions with at least 30 doctoral degrees among 5 major disciplines. The University of Mississippi, University of Texas at Dallas and the University of Louisville are among UL Lafayette?s peer institutions, according to the SREB.
The incentive-designed formula could help deflate the $230 million deficit between SREB averages and what is actually allocated to Louisiana?s institutions of higher learning.
?If we had the right distribution between four year and two-year schools, we think we could bring that $230 million number down because we?d be assessing the costs of those students,? Vandal said.
Even with the revisions to the formula, funding still relies on how much the state has in its coffers.
?Incentives in the formula will result in behavior modifications and make the dollars we do have go a little further,? Vandal said.
The state wants to see four-year schools more focused on their?own mission and target dollars in that direction,? Vandal said.
?It?s not so much that our funding overall will improve that much greatly but the use of the dollars we have will be better,? Vandal said.
The incentives should help schools become more competitive, excel at its specialized mission and more closely resemble its SREB peers, Savoie said.
The funding philosophy for higher education is changing, Savoie said.
?(It) used to be more focused on institutions, now it?s focused on what does the institution need to serve the state better,? Savoie said.
The revisions also provide for a cost analysis of courses which weighs equipment necessary for the course and student/faculty ratio.
Over the next few weeks, the board will discuss the revised formula with the state management systems. The board has hired consultants to review and fine-tune the revisions, Savoie said.
ŠThe Lafayette Daily Advertiser
August 10, 2004
