COORDINATING BOARD FOR HIGHER EDUCATION
HIGHER EDUCATION FUNDING FORMULA TASK FORCE

OHIO and TENNESSEE

EXAMPLES OF FUNDING STRATEGIES THAT HAVE BEEN EFFECTIVE IN THE PAST

Ohio’s Challenge Funding Approach:

  • Ohio had a long-standing formula system that is enrollment based. Clinical education, statewide agriculture research and public service, and certain other statewide initiatives are funded as separate line items

  • Mission-driven performance factors that Ohio currently/or has used includes:

    • Access Challenge: Limits tuition increases for certain campuses by providing appropriations in lieu of tuition increases

    • Success Challenge: Promotes degree completion by “at risk” students (Performance-based)

    • Technology Challenge: Provides grants to institutions to promote instructional advances in development and application of information technology

    • Jobs Challenge: Provides focused grants to institutions to provide better workforce training for small/medium size firms

    • Research Challenge: Provides incentives to attract research grants.

  • Initially, when the new strategy was adopted, universities agreed to limit tuition increases to 3.5%. An additional 2% may be charged by each campus if earmarked for student financial aid, technology improvements, or direct services to students. The tuition policy is tied to overall funding increase and can be higher if appropriations are at a level lower than requested

  • All of higher education supports the proposal and “speaks with one voice”

Tennessee:

  • Long-standing formula system funds enrollments and mission through use of peer institutions and research performance. Medical education, statewide agriculture research, and public service initiatives funded as separate line items

  • Centers of Excellence: Competitive grant program with performance benchmarks and incentive matching requirement focuses resources to academic and research programs for achieving national and regional recognition

  • Performance funding allocated on: Major Field Tests, Alumni and Enrolled Student Surveys, Accreditation, Peer Review of Undergraduates Programs, Master's Program Reviews and Placement for Two-Year Institutions, Enrollment Goals, Student Progress, Mission-Specific Objectives, Improvement Actions

  • Endowed Chairs: Grant program with incentive matching requirement

  • Academic Student Scholarships: Competitive grant program with incentive matching requirement

  • Special initiatives such as Technology grants

  • Capital Renewal Funding: Placed a priority in funding deferred maintenance through multi-year capital budgets beginning in 1978 with annual appropriations for this purpose (a statewide audit and statement of need formed the basis for the initiation of this fund)