MONEY TREE: Plan Would Link College Funding with Performance
MOREHEAD, Ky. (AP) — A proposal by the Kentucky Council on Postsecondary Education would link performance by Kentucky’s public colleges and universities to extra state funding.
The plan is part of an effort to boost Kentucky’s low national rankings in educational attainment. The council will include it in a $2.4 billion budget request for the next biennium, which begins July 1.
The council’s senior vice president for budget policy, John Hayek, said the measure will put pressure on institutions to improve.
“I think that is what the state wants from its investment,” Hayek said. “I think most taxpayers would want us channeling funds to institutions that are helping students graduate.”
University of Kentucky Provost Kumble Subbaswamy told The Courier-Journal that the school welcomes the accountability sought by the measure.
It would establish performance-based standards for allocating tax dollars to state universities — a strategy that officials hope to expand on in the future.
The council plans to finalize details of the program in February.
In general, it would set aside $25 million in state funds during the second year of the biennium for the public universities and the Kentucky Community and Technical College System.
Universities would receive money from the fund based on how well they improve graduation rates and degree production. They would also be called on to close the achievement gap for underprepared students and raise the number of student transfers from the community and technical college system to the four-year universities.
The new funding totals about 2.5 percent of the state’s annual appropriation to public universities, which Hayek said is enough to get attention without creating financial instability.
In September, a study the council commissioned showed that Kentucky is improving faster than any other state in certain aspects of educational attainment, but remains low in national rankings in five of the six categories examined. That month the council also set 2015 performance targets for state colleges as part of a five-year strategic agenda, and Hayek said those targets would be used in the new funding program.
James Votruba, president of Northern Kentucky University, said he is not surprised by the move and agrees that the public has a right to expect certain outcomes from its investment in public institutions.
“I think (the council) understands the kind of pressures that we work with, and there’s always going to be negotiation around a statewide coordinating board wanting to see higher levels of performance,” he said.
Hayek said the council will assess each university’s performance in January 2014.
Under the plan, each college or university would be eligible to receive a predetermined amount from the performance fund. If an institution fell short, it would receive a percentage of that amount based on how close it came to its goal. Any remaining funds would carry over into the next biennium, providing the school another opportunity to improve performance and earn the funds.
Any money left after four years would be placed in a financial aid fund for students in the region of the underperforming university.
Officials plan to submit the budget request, which was approved 10-1 at the council’s meeting in Morehead, to Gov. Steve Beshear and legislators.
Rep. Carl Rollins, D-Midway and chairman of the House Education Committee, said he expects the General Assembly to support the funding concept and believes the dollar amounts should be larger.
“You just have to be cautious when you set the goals,” he said.