New Funding Models, Old Funding Problems

Apparently the nation’s governors think it’s a really great idea to start funding the country’s public universities based on their “performance.” Despite the fact that this idea has very, very limited record of success, the fad really appears to be catching on. According to an article by Amanda Crawford at Bloomberg News:

U.S. governors, who slashed higher- education budgets by $5 billion this fiscal year, say financing for public colleges and universities should be based on graduation rates, “return on investment” of taxpayer dollars and other performance measures.

The National Governors Association recommended that states use metrics, such as the number of degrees per $100,000 appropriated, to set higher-education policy and funding, according to a report released yesterday at a conference in Salt Lake City.

It’s sort of unclear how funding based on “the number of degrees awarded per $100,000” would improve actual education, however.

“While it is unfortunate that governors have had to reduce the budgets for higher education, they also realize they aren’t using the money as well as they could,” said the director of the Center for Best Practices. The NGA seems to view this funding based on performance as an accountability measure. Taxpayers demand outcomes for their money; just funding state colleges on enrollment starts to look a little questionable.

Well okay, but it seems that at the very least a rather good way to improve graduation rates would be to not cut the budget for state colleges.

Read the NGA report here.

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Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer