Georgia colleges may want to prepare to ditch their familiarity with the way they are currently funded.
Last week, Gov. Nathan Deal released a report from the Higher Education Funding Commission, a group appointed by Deal, recommending a change in the way the state’s public universities and colleges are funded.
The commission, which submitted its report to Deal in December, recommended the schools be funded through an “outcomes-based” formula, rewarding schools with high student progression and graduation rates.
“The current higher education funding formulas emphasize enrollment with little to no focus on ensuring that students are successful after they get there,” Deal said in a press release from his office. “The recommendations of the Higher Education Funding Commission are a good starting point toward emphasizing outcomes and are a strong addition to our state’s work on increasing college access, retention and completion.”
The governor’s office said the new formula aligns with Deal’s “Complete College Georgia” initiative, which aims to produce at least 250,000 additional college graduates by 2020, saying 60 percent of the Georgia’s jobs by then would require some form of higher education.
According to the University System of Georgia, 42 percent of Georgians currently have some form of postsecondary education.
“The commission has recommended a level of performance-based funding, which is now an incentive to support these Complete College Georgia goals,” said John Millsaps, spokesman for the university system. “We feel like it’s a good thing to have.”
The university system has “pretty much embraced” the recommended funding formal and its chancellor, Hank Huckaby, was a part of the commission.
“From the start, we were very excited about this commission and the potential it had,” Millsaps said.
The commission has proposed the formula reward student progression and the number of graduates while providing incentives for “target” student populations, including adult learners and Pell Grant recipients. The formula will also aim to determine “sector” priorities and strategic initiatives for each school.
For example, one college may value high successful transfer rates while another puts more emphasis on four-year degrees.
University of North Georgia officials directed questions about the formula to the system office, but said the funding shift “could be beneficial” because of the university’s academic history.
But there has been some concern about schools becoming “graduation mills” and faculty inflating grades for additional funding, potentially on the directive of administration.
The commission briefly addressed those concerns in its report, stating the commission “consistently emphasized the need to ensure that changes to the funding formula would not undermine the quality of institutions and degrees.”
It also stated officials will “rigorously monitor the effects” of the new formula.
“I wasn’t a participant in the commission meetings, but I do know that was a concern,” Millsaps said. “Obviously the commission looked at everything. They looked at all the different ways you could structure it; they looked at all the positives and benefits; they looked at the potential pitfalls and problems that could occur. I know that was one of the areas that was incorporated into their thinking.”
Millsaps said the next step was for the system to work with the Technical College System of Georgia and the governor’s office to add to the commission’s framework.
According to the report, the commission recommends the formula would be used to develop a revenue-neutral base in fiscal year 2015. New funds would be granted, or potentially taken, depending on outcomes in fiscal year 2016.
Millsaps said it would be hard to determine what specific affect the new formula would have on school budgets until that time.
“I don’t know the details of how this is going to eventually be put into practice,” Millsaps said. “Right now people ask: ‘Well, what’s going to be the impact of XYZ college’s budget?’ We don’t even know right now what the budget of the college is going to be this upcoming fiscal year. That’s just speculation.
“To tell you the truth, if this work had never been done I couldn’t tell you what a college’s budget will be in FY ’15. It’s just too far down the budget cycle to predict it and it would be a mistake to try and speculate what the budget will look like.”
According to the report, the formula would drive funding allotment at the system level, but appropriations to individual institutions would still rest with the university and technical systems.