Arkansas governor: Change higher education funding formula

By Andrew Demillo, Associated Press | Posted - Sep. 1, 2015 at 1:41 p.m.

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LITTLE ROCK, Ark. (AP) — Arkansas Gov. Asa Hutchinson on Tuesday proposed overhauling the funding formula for higher education institutions and scholarships, part of an effort to boost the number of college graduates in the state.

The Republican governor called on a group of college presidents to work with the state's director of higher education to come up with recommendations to the Legislature.

"We have an outdated funding formula for higher education. It needs to be re-evaluated," Hutchinson said.

He stopped short of outlining a specific funding formula, but said a portion should be based on performance and include incentives for meeting goals, such as reducing the number of students taking remedial classes and increasing the number of minority students earning a degree. Hutchinson said he also wants to raise the number of college students who are graduating by 10 percent.

Hutchinson said he also wanted to look at directing a portion of college scholarship funding toward targeted populations such as minority, technical school and nontraditional students.

"That way, we're covering the needs now, but we're developing the opportunity for the future to fund those targeted populations that are important for the state," Hutchinson said.

Currently, 90 percent of a state college or university's funding is based on enrollment while the remaining 10 percent is based on performance measures such as the number of degrees awarded. Higher Education Director Brett Powell said basing the funding so much on enrollment makes planning difficult for schools, especially community colleges, where numbers change throughout the year.

"We're hoping to get away from enrollment-based funding as much as possible and base the bulk of the funding on outcomes, what institutions are able to achieve," Powell said. "So if the goal of the plan is to get more degrees and certificates in the state, then we should fund based on more degrees and certificates in the state."

Hutchinson called for the changes as the state Department of Higher Education released a draft of its master plan on boosting college graduation rates over the next five years.

Powell said he hoped to have formula recommendations ready by April, when the Legislature meets for its session focused primarily on budget matters, though the scholarship proposals could take longer. Hutchinson told reporters he believed the recommendations were probably better suited for the Legislature's regular session in 2017.

Hutchinson's proposals come after the Legislature approved his budget for the fiscal year that began July 1, which kept funding for higher education flat while cutting money for most other state agencies. Hutchinson vowed to protect college and university funding, but also signaled the money will likely remain flat as he called on the schools to find ways to run more efficiently.

"I want you to know that I want to continue to have your back when it comes to the state's portion," Hutchinson said.


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