New Higher Ed Formula Would Base Funding Entirely On Student Performance

Sep 30, 2016

Credit Sarah Whites-Koditschek/ARKANSAS PUBLIC MEDIA

University of Arkansas Medical Sciences sonography student Debra Howell is a nontraditional 35-year-old whose father came from Belize. She has one more year to finish her bachelor’s degree. In addition to a 40-hour a week residency, Howell must find time to study — and care for her kids. She works 12-hour shifts on Saturdays and Sundays as an X-ray technician.

“I worry all the time about having to stop. My family is very supportive of what I do, but unfortunately they’re not in any better situation to help me keep up and sometimes I have to choose between paying rent and buying groceries,” she said.  

In the 2017 legislative session lawmakers will consider a new higher education funding formula developed by Governor Asa Hutchinson and higher education officials that would calculate 100 percent of higher education funding on student outcomes like graduation and course completion, rather than the current 10 percent performance, 90 percent enrollment model.

Howell is perhaps the type of student who could benefit from an outcome-based formula, but she said the bigger risk factor for her isn’t failing classes but financial aid. She used up her federal Pell grant money too early because she wasn’t aware of the programs limits.

“I just feel a lot of us aren’t knowledgeable of what’s out there.  We don’t know where to look, how to find it, what to do,” she said. “It’s definitely a struggle. I have some friends that actually kind of help push me and say, ‘no you have to keep doing this. You’ve come too far to quit.’”

‘AN ACADEMIC PATHWAY’

The effects of a performance-based formula would affect funding slowly. Schools could gain or lose two percent of their budget every year.

“It’s all about what you do with the students once they’re enrolled. So, how well do you move students through the process from enrollment to graduation to employment attainment to credential attainment?” says Department of Higher Education head Maria Markham.

Far from advantaging schools with already high success rates, she says the formula is designed to incentivize teaching disadvantaged student populations. Students with higher risk factors would be weighed 1.29 times students without.

Of the roughly 3,900 students at Karla Hughes' University of Arkansas Monticello campus, little more than a quarter will graduate within six years, but she aims to bring that up.

Chancellor Karla Hughes of the University of Arkansas at Monticello says high poverty levels, a rural setting, and remedial academic needs of many of the roughly 3,900 students there are challenges. UAM has a 28 percent six-year graduation rate. The state’s average is 42 percent for four-year public universities.

The key to boosting outcomes will be using data to help students progress, and her school is already doing it.

You use all the information you have about a student all the way from their SAT and ACT scores to their high school standing, what they did in high school, their outside activities, and you determine an academic pathway with them.”

Hughes says she hopes the new model could help justify future funding increases at the state legislature.

NO MONEY MO’ PROBLEMS

Arkansas hasn’t added university funding in a decade. A non-partisan research institute, the Center on Budget and Policy Priorities, found on average states spend 20 percent less on higher education than they did before the recession.

Yet Graduate School of Education Professor Kevin Dougherty at Columbia University’s Teachers College says there’s no evidence incentive funding works and warned of unintended consequences.

Performance-funded states like Tennessee, Ohio, and Indiana lowered academic standards, grades and degree requirements in the face of those incentives, according to his research.

“It’s not just an issue of will. It also may be an issue of capacity, knowledge, internal organization, and they may need help to get there. So … how is the state going to address those issues of capacity development?”

While the department has support programs for universities, Arkansas’s proposed formula does not include a request to fund more.

Nationwide, according to the National Conference of State Legislators, 32 states had some funding based on performance in 2015. A small handful of those wagered a majority of funding on outcomes.

Here is the state's master plan for higher education in Arkansas.