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New college funding plan laid out

The Colorado Commission on Higher Education has gotten its first detailed look at a proposed new system of higher education funding.

The revised version of Senate Bill 11-052 that was presented to the group Friday ultimately would base 25 percent of state support on colleges’ success in meeting goals that would be negotiated between institutions and the commission.

The bill also sets a 2020 statewide goal of increasing the number of degrees and certificates awarded by 30 percent. About 43,000 degrees and certificates were awarded in 2010.

Sen. Rollie Heath, D-Boulder and a prime sponsor of SB 11-052, outlined the bill for the commission. The measure was introduced Jan. 19 but Heath has developed a new version in consultation with the Department of Higher Education, which, of course, is headed by Lt. Gov. Joe Garcia.

Montage of Colorado colleges
Colorado State University in Fort Collins, University of Colorado-Boulder and the Auraria Higher Education Center.

If passed, the bill would be the second big change for higher education in two years. Last year’s Senate Bill 10-003 took tuition authority away from the legislature and gave it to boards of trustees – with oversight and approval by CCHE. Direct state support has declined steeply over the last decade, and state institutions now draw roughly three-quarters of their revenue from tuition.

The idea of tying college funding to performance – student retention, graduation rates and such – is being widely discussed nationally. Julie Bell, a staff member of the National Conference of State Legislatures, briefed the commission on the issue before Heath’s presentation.

“Performance funding has been one of the hottest trends around the country over the last couple of years among state legislatures,” she said. About 20 states have it some form, but most programs affect only small amounts of funding.

The idea also was suggested as a future direction for Colorado in “The Degree Dividend,” the higher education strategic plan released last year. But – and this was the subject of much discussion – drafters of the plan agreed that performance funding won’t work until state financial support of higher ed increases.

“I think this [bill] does the same thing with higher education” that last year’s educator effectiveness law does for K-12 education, Heath said.

Some commissioners had questions about the idea. Larry Beckner of Grand Junction noted that the current system of performance contracts, with no penalties and no extra funding, seems to have “had a lot of success with self-regulation” in terms of colleges meeting their goals.

“I think we’re looking in the right direction … but it does concern me that we’re getting into a punishment mode [potentially taking money away] in an area where we don’t know if the incentives are actually accomplishing the goals.” Bell had told the commissioners there’s not a lot of research yet on the effectiveness of performance funding.

Commissioner Patricia Pacey of Boulder noted the financial crisis, saying, “It’s one thing to have the goals … without it being backed up by any dollar commitments.”

Heath said something different has to be done with higher education. “We’re not graduating enough people now to meet workforce needs.”

Heath said he hadn’t yet shared the new version of the bill with campus presidents and trustees. Some of them are likely to skeptical of performance funding without additional state support. Some college presidents also oppose a stronger role for CCHE.

Heath also thinks he may have at least a temporary answer to the funding issue. Earlier in the week he unveiled a proposed ballot measure that would raise state income and sales taxes for three years in an effort to partially replenish K-12 and higher education funding – see this story.

Here are key changes in the new version of Heath’s bill:

  • 25 percent of the overall funding for higher education to be based on institutional performance, starting in 2016-17. The original bill proposed phasing in the funding shift by 5 percent a year starting in 2012-13.
  • The existing system of performance contracts would be retained. The performance contract cycle would be reduced to five years from 10. The original language of the bill had proposed a system of “memoranda of expectations.”

As the original bill did, the version envisions a strong role for CCHE, including:

  • Preparation of a statewide master plan. This would not be a brand-new role, and CCHE already is working on a new plan – see tentative work schedule.
  • Setting specific goals and expectations for the tiers of the state system – research universities, four-year colleges, community and junior colleges, and vocational schools – and for individual institutions.
  • Negotiating performance contracts with each institution based on the master plan and the statewide goals. Contracts would be individualized by institution, so a community college, for instance, wouldn’t necessarily be held to the same graduation expectations as CU-Boulder.

As with the first version, the latest draft of the bill references broad state goals for higher education – increased access affordability and productivity; reduction of ethnic gaps in college completion; affordability; and increased contribution of higher education to economic development.

The bill does have influential bipartisan sponsors, including House Education Chair Rep. Tom Massey, R-Poncha Springs; Senate Ed Chair Sen. Bob Bacon, D-Fort Collins; Sen. Keith King, R-Colorado Springs. Joint Budget Committee member Rep. Mark Ferrandino, D-Denver, is signed on in the House.

The measure will have its first hearing in the Senate Education Committee on March 17.

Westwood gets off probation

The commission Friday voted unanimously to take for-profit Westwood College off of probationary authorization and return it to full authorization. CCHE was following the lead of the Accrediting Commission of Career Schools and Colleges, which last month renewed Westwood’s accreditation for three years. Westwood was placed on probation by the CCHE in December. More information & background story

CMC moves closer to first bachelor’s degrees

The commission approved two bachelor’s degrees requested by Colorado Mountain College, the local district junior college system that previously offered only associate’s degrees.

The college plans to offer a bachelor of science in business administration and a bachelor of arts in sustainability studies. The legislature last year approved expansion of CMC’s programs, allowing up to five bachelor’s programs and requiring proof of workforce need, student demand and cost effectiveness.

DHE staff determined the application met those requirements. The commission action becomes effective after approval of the programs by the accrediting agency, the North Central Association. That’s expected next month. More information

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