The state is changing the way money is distributed to Louisiana’s colleges and universities by putting more emphasis on the progress made by lower income, minority and adult students and less priority on research.
The funding formula supports a new Master Plan, Board of Regents approved Wednesday without dissent, that will act as a policy road map deciding who gets to go college, what they will have to achieve while there and how higher education will operate in coming years. The 38 public colleges, technical schools and universities in four systems educated about 211,745 students in 2018.
Regents approved in June a phased-in approach to align funding formula outcomes to support the state’s attainment goals for college students in coming years and reviewed the calculations Wednesday morning prior to taking up the Master Plan.
The Regents, which oversee policies and money for the state’s higher education institutions, set a goal that in 11 years 60% of all adults between the ages of 25 and 64 years old hold a degree or credential. Presently, 44.2% of Louisiana working age adults meet that yardstick, which is behind the national average of 47.6%. To achieve that goal, the Regents estimate that the number of annual degrees and credentials awarded would have to more than double from the 40,000 produced in 2018 to 85,000 per year.
Regents argue that college graduates and certified technical personnel get paid more – meaning about $1.3 billion more income and sales taxes would be collected – and are more likely to be covered by private healthcare insurance – meaning taxpayers would see save about $1.2 billion in Medicaid costs.
The heads of the four higher education systems lined up behind Gov. John Bel Edwards to vocalize their support of the new plan, called Louisiana Prospers. The last plan was approved by the Board in August 2001.
The new master plan has “the audacity of high expectations,” said Jim Henderson, head of the University of Louisiana System. He said a lot of the state’s workers lack the credentials to take advantage of the new plants and businesses coming to the state. That is being addressed in the new plan and in programs the UL System have begun to ease adults starting or returning to college to work on degrees or training certificates.
“I know that sounds like a long time from now,” Gov. John Bel Edwards said of the goal of basically doubling the number of diplomas and certificates by 2030, “but we’re going to turn around and its going to be there. … This is so critically important to the future our state.”
Edwards said the new proposal includes a focus on educating adults as trained workers. It also blurs the lines between high school and college allowing greater access to specific courses.
“It is the number one question that I am asked by decision makers all over the world,” Edwards said. “We have a lot of work to do and that’s on the funding side.”
Part of the revamp in goals includes changing how the Regents determine what share of the state’s annual appropriation each college system gets. The systems decide the amount for each of the institutions under their wing.
In 2008, Louisiana appropriated about $1.5 billion. Annual budget reductions dropped the amount to about $750 million by 2015. When Edwards took over he stopped the cuts, leaving appropriations stable for two years. About $47 million was added from the surplus this year. Of that among roughly $500 million goes to the campuses, with the rest going to special agencies like the agricultural centers. The state provides only about a third of most institutional budgets. They rely on tuition, fees and grants for the most part.
Regents want to phase out incentives tied to enrollment and to research while increasing the weight given in the formula for adults and low-income earners who complete their degree or certificate requirements as well as adding a new metric for minority students who complete their studies.
Regent Robert Levy, of Dubach, said for years officials have been kicking around how best to distribute money. The various formulas became too confusing and during the Jindal years, the GRAD Act was adopted for a short time. Because only the Legislature can raise tuition, the GRAD Act allowed universities to increase tuition without prior legislative approval once the institutions hit specific goals.
But that formula did nothing to further higher education’s mission to provide a path for better employment opportunities for low income, minority and rural students, Levy said at the Wednesday meeting.
“There’s significant angst and anxiety around the formula,” said Commissioner of Higher Education Kim Hunter Reed during a meeting prior to convening the official Regents hearing Wednesday. “We’ve worked hard to communicate about the formula and aligning it to Master Plan.”