linking finance to performance/outcomes
DESCRIPTION
Linking Finance to Performance/Outcomes. presented to Montana University System Helena, Montana March 11, 2010. Why?. What’s driving this policy shift?. What’s Driving this Policy Shift?. Increasing clarity of goals and an urgency about attaining them National level State level - PowerPoint PPT PresentationTRANSCRIPT
National Center for Higher Education Management Systems3035 Center Green Drive, Suite 150Boulder, Colorado 80301
Linking Finance to Performance/Outcomes
presented to
Montana University SystemHelena, Montana
March 11, 2010
Why?
What’s driving this policy shift?
slide 2
What’s Driving this Policy Shift?
1. Increasing clarity of goals and an urgency about attaining them– National level– State level
2. Resource constraints
3
National Level
“By 2020, America will once again have the highest proportion of college graduates in the world”
President Barack Obama, February 24, 2009
slide 4
State Level
• Board of Regents Goals– Increase educational attainment of Montanans – Assist in the expansion and improvement of the
economy– Improve institutional efficiency and effectiveness
5
Source: OECD Education at a Glance 2009
Comparing Montana with Nations & Other States in the
Percentage of Young-Adult Degree Attainment (ages 25-
34)
56 Canada • Korea
54 JapanMassachusetts
52
North Dakota 50
Minnesota • New York 48New Zealand
Connecticut • Iowa • New Hampshire • New Jersey 46Maryland
Nebraska • South Dakota • Vermont 44 IrelandIllinois • Pennsylvania • Rhode Island Norway
Virginia 42Colorado • Hawaii• Kansas Australia • Belgium • France
Wisconsin 40 Denmark • Sweden • UNITED STATESWashington Finland • Spain
Utah 38Missouri Netherland • United Kingdom
Indiana • Maine • MONTANA • Michigan • Ohio • North Carolina • Oregon 36 LuxembourgFlorida Switzerland
Georgia • Idaho • South Carolina • Wyoming 34
Alabama • Kentucky • Mississippi 32Arizona • Tennessee • Texas Iceland
Alaska • Oklahoma 30 PolandNew Mexico
Louisiana • Nevada • West Virginia 28 Greece
Arkansas 26
24Germany
22 HungaryPortugal
20Austria • Italy • Mexico
18
United States % OECD Counties
California • Delaware •
Slovak Republic (17%)Czech Republic (15%) Turkey (14%)
6
slide 7
Current Annual Degree Production – 2,252,212
Additional Annual Degree Production Needed – 150,528 per Year
Associate and Bachelors Degrees Needed to Become the Most Educated Country by 2020
Increase in State and Local Funding at Current Cost per FTE
Note: Assumes private institutions will maintain current share
77
Annual Percent Increase Needed to Reach 2020 Goal of 51%
Note: for Montana this translates to 596 per year.
Colo
rado
New
Jers
ey
Min
neso
taN
ort
h D
ako
taC
onnect
icut
New
Ham
psh
ire
Mass
ach
use
tts
Undergraduate FTE Enrollment by Sector (2006-07)
9
How Montana Ranks Among Other States on Selected Measures for Education and Economic
Development
Source: Tom Mortenson, Postsecondary Opportunity; US Census Bureau, 2006 ACS Public Microdata Sample (PUMS) File, Kauffman Foundation, Regional
Economic Information System, Bureau of Economic Analysis, US Department of Commerce
State New Economy Index
Personal Income per Capita
Difference in Earnings Between Bachelor's & High School Diploma
Difference in Earnings Between Associate & High School Diploma
Migration Rate of College Graduates (Age 22-64)
Overall Results on Student Pipeline(Transition & Completion Rates, 9th Grade to College Completion)
Six-Year Graduation Rates of Bachelor's Students
Three-Year Graduation Rates of Associate Students
College-Going Rates of Students Directly Out of High School
Public High School Graduation Rates
Economic Development MeasuresEducation Measures
10
Undergraduate Credentials & Degrees Awarded at All Colleges per 1,000 Adults Age 18-44 with No College Degree, 2006
slide 11
Source: NCES, IPEDS Completions Survey 2005-06; U.S. Census Bureau, 2006 ACS
58
.7
14
.7
0
10
20
30
40
50
60
Iowa
North D
akotaR
hode IslandW
yoming
Utah
Minnesota
Nebraska
Verm
ontK
ansasA
rizonaM
assachusettsS
outh Dakota
Wisconsin
IllinoisN
ew H
ampshire
Pennsylvania
Colorado
Washington
New
York
Kentucky
Missouri
Florida
Delaw
areIndianaU
nited States
Michigan
Virginia
Montana
Ohio
North C
arolinaO
klahoma
Maryland
IdahoO
regonH
awaii
Georgia
Connecticut
California
Maine
West V
irginiaS
outh Carolina
Alabam
aN
ew M
exicoM
ississippiA
rkansasT
ennesseeN
ew Jersey
Texas
LouisianaN
evadaA
laska
Bachelor's Associate Certificates/Diplomas
Unite
d S
tate
s
33
.5
48
.7
Monta
na
32
.0
Undergraduate Awards per 100 FTE Undergraduates2006-07
Source: NCES IPEDS Peer Analysis System (http://www.nces.ed.gov/ipedspas/), IPEDS 2006-07 efia2007 Early Release Enrollment File; NCES IPEDS Peer Analysis System (http://www.nces.ed.gov/ipedspas/), IPEDS 2005-06 c2006_a Final Release Completions FileNote: Completions reflect 2006-07 total undergraduate degrees (Associate, Bachelors) and certificates (less than 1-year, 1-2 year, 2-4 year) awarded at Title IV degree granting public and private institutions. Enrollments reflect 2006-07 annual FTE undergraduate enrollments at Title IV degree-granting public and private institutions as reported in the IPEDS 2006-07 12-month instructional activity enrollment file. Enrollment data were aggregated from an early release data file and are subject to change.12
Public Research Institutions - Bachelors Degrees Awarded per 100 FTE
Undergraduates, 2006-07
13
Sources: NCES, IPEDS 2006-07 Completions File; c2007_a Early Release Data File Downloaded 04-28-08; NCES, IPEDS 2006-07 Instructional Activity File; efia2007 Final Release Data File; NCES, IPEDS 2006-07 Unduplicated Headcount File;
effy2007 Final Release Data File.; NCES, IPEDS Fall 2006 Enrollment File; ef2006a Final Release Data File.
Public Masters & Bachelors Institutions - Bachelors Degrees Awarded per 100 FTE Undergraduates,
2006-07
14
Sources: NCES, IPEDS 2006-07 Completions File; c2007_a Early Release Data File Downloaded 04-28-08; NCES, IPEDS 2006-07 Instructional Activity File; efia2007 Final Release Data File; NCES, IPEDS 2006-07 Unduplicated Headcount File;
effy2007 Final Release Data File.; NCES, IPEDS Fall 2006 Enrollment File; ef2006a Final Release Data File.
Public Associate Colleges - Total Credentials Awarded (Less than Bachelors) per 100 FTE Undergraduates, 2006-07
THE FISCAL REALITIES
slide 16
The Flow of Funds
17
Federal Government
Tax Policy
Appropriations/GrantsStudent Aid
Tuition
Scholarships &Waivers
Student Aid (Restricted)
Income
Available State and Local
Govt. Funds
FederalGovernment
Higher Education
Students Institutions
Economy
• K-12• Corrections• Health Care• Other Govt.
DonorsFoundationsCorporations
Stimulus
Funds
Income
The Flow of Funds - State
18
Tax Policy
Appropriations/GrantsStudent Aid
Tuition
Scholarships &Waivers
Available State and Local
Govt. Funds
Higher Education
Students Institutions
Economy
Federal Government
Student Aid
State Tax Capacity and Effort—Indexed to U.S. Average
Source: State Higher Education Executive Officers (SHEEO)
AL
AK
AZ
AR
CA
CO
CT
DE
GA HI
IL
IN IAKS
KY
LA
ME
MD
MA
MS
MT
NE
NV
NJ
NY
NC
ND
OH
OK
PA
RI
SC
SD
UT
VT
VA
WA
FL
ID
MI
MN
MO
NH
NM
TNTX
WV
WI
WY
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
1.4
1.5
1.6
1.7
0.6 0.8 1.0 1.2 1.4
Sta
te T
ax C
apacity
(Tota
l Taxable
Reso
urce
s Per C
apita
)
State Tax Effort (Effective Tax Rate)
US
OR
Slide 19
Projected State & Local Budget Surplus (Gap) as a Percent of Revenues, 2016
slide 20Source: NCHEMS; Don Boyd (Rockefeller Institute of Government), 2009
-2.1
-2.2
-2.3
-2.3
-2.4
-2.6
-2.7
-2.9 -3
-3.3
-3.5
-3.5
-3.8
-4.1
-4.6
-4.7
-4.8
-4.9 -5
-5.1
-5.2
-5.4
-5.7
-5.7
-5.8
-5.8 -6
-6.2
-6.3
-6.3
-6.7
-6.7
-6.8
-7.2
-7.4
-7.8 -8
-8.1
-8.1
-8.5
-8.5
-8.5
-8.7
-8.9
-9.1
-9.4
-9.5
-9.7
-10.
6-1
0.8
-10.
9
-12
-10
-8
-6
-4
-2
0
Mar
ylan
dM
aine
Verm
ont
New
Jers
eyCo
nnec
ticut
New
Ham
pshi
reRh
ode
Isla
ndN
orth
Dak
ota
Wis
cons
inM
assa
chus
etts
Mic
higa
nW
yom
ing
Calif
orni
aO
hio
Del
awar
eKa
nsas
Ore
gon
Virg
inia
New
Yor
kM
inne
sota
Wes
t Vir
gini
aPe
nnsy
lvan
iaIll
inoi
sA
lask
aN
ebra
ska
Mon
tana
Uni
ted
Stat
esLo
uisi
ana
Indi
ana
Haw
aii
Okl
ahom
aN
ew M
exic
oM
isso
uri
Kent
ucky
Iow
aSo
uth
Dak
ota
Was
hing
ton
Flor
ida
Sout
h Ca
rolin
aA
rkan
sas
Geo
rgia
Colo
rado
Tenn
esse
eN
orth
Car
olin
aId
aho
Uta
hA
rizo
naN
evad
aA
laba
ma
Texa
sM
issi
ssip
pi
State/Local Funding plus Tuition Revenue per FTE Student
All Institutions (Public)
21
Source: SHEEO SHEF
Revenues Per Student from Net Tuition, State, & Local Appropriations
Public Research
slide 22
$29,172$24,184
$23,263$22,095
$21,640$21,384
$20,010$19,865$19,783$19,721$19,545$19,227$18,989$18,843$18,773$18,657$18,537
$17,610$17,360$17,267$16,974$16,774
$16,275$16,195$16,172$16,155$16,092$16,059$16,057$15,837$15,774$15,714$15,568$15,541$15,406$15,180$15,125$15,093$15,003$14,865$14,777
$14,018$14,006$13,675
$13,121$12,666$12,449$12,324
$11,620$11,243
$9,682
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
Alaska
Minnesota
Haw
aiiConnecticutN
ew York
Vermont
North Carolina
Massachusett
sKentuckyW
yoming
Maryland
Nebraska
Alabam
aCaliforniaIow
aD
elaware
New
JerseyTennesseeW
ashingtonSouth CarolinaM
ainePennsylvaniaN
ew M
exicoN
ationIdahoIndianaM
ichiganM
issouriRhode IslandKansasVirginiaG
eorgiaU
tahW
isconsinO
klahoma
Nevada
Ohio
West Virginia
Arizona
Arkansas
IllinoisFloridaN
orth Dakota
New
Ham
pshireTexasLouisianaM
ississippiO
regonSouth D
akotaM
ontanaColorado
Sources: NCES, IPEDS 2006-07 Finance Files; f0607_f1a and f0607_f2 Final Release Data Files.
NCES, IPEDS 2007-08 Institutional Characteristics File; hd2007 Final Release Data File.NCES, IPEDS 2006-07 Enrollment Files; ef2006a, effy2007, and efia2007 Final Release Data
Files.
Revenues Per Student from Net Tuition, State, & Local Appropriations
Public Masters and Baccalaureate
slide 23
$17,984 $16,148 $14,587$14,440$14,426
$13,683$12,929
$12,324$12,105$12,011$11,862
$11,443$11,443$11,389$11,284$11,266$11,249$11,063$10,836$10,788$10,778$10,721
$10,464$10,405$10,370$10,343$10,312$10,275$10,251$10,179$10,162$10,039
$9,957$9,945$9,933$9,702$9,701$9,630$9,622$9,410$9,185$8,959$8,846$8,748
$8,414$8,400
$7,964$7,877
$7,209$6,311 $5,105
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
$20,000
Delaw
areH
awaii
ConnecticutN
orth CarolinaA
laskaN
ew Jersey
New
Mexico
Iowa
Maryland
Massachusett
sM
aineVerm
ontVirginiaRhode IslandA
labama
Montana
IllinoisW
ashingtonN
ew York
FloridaM
ichiganSouth CarolinaKentuckyO
hioM
ississippiN
ation IdahoM
issouriD
CKansasPennsylvaniaCaliforniaN
ew H
ampshire
Minnesota
TexasIndianaTennesseeO
regonN
orth Dakota
Arkansas
Nebraska
Wisconsin
Nevada
Oklahom
aLouisianaG
eorgiaW
est VirginiaSouth D
akotaA
rizonaU
tahColorado
Sources: NCES, IPEDS 2006-07 Finance Files; f0607_f1a and f0607_f2 Final Release Data Files.
NCES, IPEDS 2007-08 Institutional Characteristics File; hd2007 Final Release Data File.NCES, IPEDS 2006-07 Enrollment Files; ef2006a, effy2007, and efia2007 Final Release Data
Files.
Revenues Per Student from Net Tuition, State, & Local Appropriations
Public 2-Year
slide 24
$14,793$11,197
$10,683$10,287
$9,964$9,953 $9,125
$8,844$8,801$8,705$8,625$8,480$8,449$8,411$8,378$8,214$8,067$8,044
$7,772$7,633$7,566$7,509$7,507$7,448$7,432$7,416$7,403$7,329$7,239$7,222$7,117$7,018$6,918$6,895$6,844$6,823$6,714$6,676$6,630$6,510$6,465$6,353
$6,082$6,028$5,970$5,945$5,939
$5,712$5,517
$5,297$3,369
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Wisconsin
Haw
aiiW
yoming
Maryland
Delaw
areConnecticutVerm
ontKansasO
regonN
ew York
New
Ham
pshireIdahoM
assachusetts
New
Mexico
Alaska
Michigan
PennsylvaniaN
orth Dakota
Minnesota
Arizona
Rhode IslandO
hioU
tahN
orth CarolinaTexasN
ationM
ontanaCaliforniaW
ashingtonM
aineN
evadaA
labama
IllinoisN
ebraskaM
issouriLouisianaTennesseeIow
aA
rkansasN
ew Jersey
Oklahom
aSouth CarolinaFloridaG
eorgiaM
ississippiVirginiaSouth D
akotaColoradoIndianaKentuckyW
est Virginia
Sources: NCES, IPEDS 2006-07 Finance Files; f0607_f1a and f0607_f2 Final Release Data Files.
NCES, IPEDS 2007-08 Institutional Characteristics File; hd2007 Final Release Data File.NCES, IPEDS 2006-07 Enrollment Files; ef2006a, effy2007, and efia2007 Final Release Data
Files.
Net Tuition as a Percent of Public Higher Education Total Educational Revenue by
State, FY 2008
Note: Dollars adjusted by 2008 HECA, Cost of Living Adjustment, and Enrollment Mix
Source: SHEEO SHEF
25
Net Tuition Revenues per FTE and State-Funded Tuition Aid per FTE by State, FY 2008
(Public Institutions Only)
Note: Figures are adjusted for inflation, public system enrollment mix, and state cost of living. Funding and FTE data are for public non-medical students only.
Source: SHEEO SHEF
26
Affordability: Need-based Financial Aid
slide 27
108% 102%96%
88% 86% 84%84% 82%
74% 70%62% 59% 57%
56%50%49%48%48% 46% 43% 41%
41% 37%36% 33%
32% 29%28%28%28% 24% 21%
20%19% 17%
16% 13% 10% 9% 8% 8% 6% 5% 5% 5% 3% 1% 1% 0% 0%
0%
20%
40%
60%
80%
100%
120%
Washington
New
Jersey Verm
ont N
ew York
Pennsylvania Indiana M
innesota Illinois Connecticut N
orth Carolina W
isconsin M
aryland M
assachusetts
California Virginia D
elaware
Kentucky N
evada O
hio W
est Virginia Colorado O
klahoma
Maine
South Carolina Iow
a Texas M
issouri A
rkansas M
ichigan Rhode Island O
regon Florida N
ew M
exico N
ebraska Kansas Tennessee N
ew H
ampshire
North D
akota M
ontana Louisiana U
tah A
laska A
labama
Haw
aii Idaho A
rizona M
ississippi W
yoming
Georgia
South Dakota
Source: Measuring Up 2008
State need-based aid as a proportion of federal need-based aid.
Measuring Up: Affordability
Source: Measuring Up 2008
28
Median Earnings of Population Age 25-64 by Level of Education, 2006
Source: U.S. Census Bureau, 2006 American Community Survey PUMS File
29
Education Attainment & Personal Income by Montana CountiesPers
onal In
com
e P
er
Capit
a
Adults aged 25-64 with a Bachelor’s Degree or Higher (%)
30
Adjusting to Changed Circumstances
Improving Productivity
31
Productivity: Total Funding per Degree/Certificate
(Weighted*, 2006-2007)
slide 32
29,0
75
30,6
19
33,2
73
33,7
56
34,3
30
34,5
94
36,4
98
37,8
23
38,3
64
38,3
65
39,5
16
39,5
16
39,9
18
42,1
77
42,1
98
42,4
08
42,6
93
42,8
47
42,8
73
42,9
48
43,8
20
44,2
72
44,3
71
45,8
33
45,9
04
46,5
22
46,8
80
47,4
53
47,6
72
47,7
49
48,6
11
49,8
94
52,4
91
52,5
72
52,8
88
53,5
35
54,5
53
56,0
90
56,2
80
56,8
88
56,9
60
59,4
20
59,4
65
63,8
22
64,9
34
65,9
75
66,6
23
72,8
46
75,7
44
79,7
94
86,0
09
-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
FloridaColoradoW
ashingtonU
tahN
orth Dakota
Oklahom
aW
est VirginiaM
ontanaSouth D
akotaKansasG
eorgiaLouisianaW
isconsinIdahoN
ew H
ampshire
IllinoisM
ississippiArizonaArkansasM
innesotaO
regonKentuckyIow
aVirginiaM
issouriN
ationO
hioIndianaN
ebraskaTexasSouth CarolinaN
orth CarolinaM
ichiganTennesseeN
ew M
exicoCaliforniaM
ainePennsylvaniaAlabam
aN
ew York
Nevada
Maryland
Vermont
New
JerseyM
assachusetts
Haw
aiiConnecticutRhode IslandD
elaware
Wyom
ingAlaska
Tuition and FeesState and Local
Sources: SHEEO State Higher Education Finance Survey 2008; NCES, IPEDS Completions Survey; U.S. Census Bureau, American Community Survey (Public Use MicrodataSamples)
*Adjusted for value of degrees in the state employment market (median earnings by degree type and level)
Degrees & Certificates awarded per FTE vs. Total Funding per FTE (2006-2007)
slide 33
AL
AK
AZ
AR
CA
CO
CT
DE
FL
GA
HIIDIL IN
IAKS
KY
LAME MD
MA
MI
MN
MS MO
MT
NE
NV
NH
NJ
NM
NY
NC
ND
OH
OK
OR
PA
RI
SC
SD
TNTX
UT
VTVA
WA
WV
WI
WY
US
14
17
20
23
26
29
32
5,000 8,000 11,000 14,000 17,000 20,000
Low Resources, High Production
Low Resources, Low Production
High Resources, High Production
High Resources, Low Production
Performance:Degrees
Awarded per 100 FTE
Resources: Total Funding per FTE
Source: SHEEO State Higher Education Finance Survey 2008: NCES IPEDS Completions Survey
Total Funding per FTE (2006-07)
Perfo
rmance
(200
6-0
7)
AL
AZ
AR
CA
CO
CT
DE
FL
GAHI
I D
I L
I N
I AKS
KY
LA
ME
MD
MAMI
MN
MS
MO
MT
NE
NV
NHNJ
NM
NY
NC
ND
OH
OK
OR
PA
RI
SC
SD
TN
TX
UT
VT
VA
WA
WV
WIWY
US
15
18
21
24
27
5,000 10,000 15,000 20,000 25,000 30,000 35,000
Performance Relative to Funding: Bachelors Degrees Awarded per 100 FTE Undergraduates
(Public Research Institutions)
Source: NCES, IPEDSslide 34
Total Funding per FTE (2006-07)
Perfo
rmance
(200
6-0
7)
AL
AK
AZ AR
CA
CO
CT
DE
FL
GA
HI
I D
I L
I N
I A
KS
KY
LA
ME
MD
MAMIMN
MSMO
MT
NE
NV
NH
NJ
NM
NY
NCND
OH
OK
OR
PA
RISC
SD
TN
TX
UT
VT
VA
WA
WV
WI US
5
10
15
20
25
30
2,000 5,000 8,000 11,000 14,000 17,000 20,000
Performance Relative to Funding: Bachelors Degrees Awarded per 100 FTE Undergraduates
(Public Bachelors and Masters)
Source: NCES, IPEDSslide 35
Total Funding per FTE (2006-07)
Perfo
rmance
(200
6-0
7)
Performance Relative to Funding: All Credentials Awarded per 100 FTE Undergraduates
(Public Two-Year Institutions)
Source: NCES, IPEDSslide 36
How?
What are Emerging Best Practices?
slide 37
Basic Principles
• Applied to allocation of base – not just a small add-on
• Few factors that can be measured unambiguously• Different factors for different types of institutions
– Research– 4-Year teaching– 2-Year
• Methodology is transparent – incentives created are linked to goals in obvious ways
• They can be applied in good times and bad
38
Emerging Practices
• Using completed SCH – not enrolled SCH – as driver in calculating base
• Additional funds tied to specific goals– Increasing number of graduates – with variations for
• At-risk students• Students in priority fields
– Increasing research funding from sources other than state or institution’s own funds
– “Momentum Point” attainment in two-year institutions
39