Ohio's new college funding system, which incorporates performance measures, will begin in July despite an ongoing economic crisis - turmoil at least one expert considers fatal for performance models.
While the current model is based solely on enrollment, 30 percent of future funding will be based on factors, including the number of students who pass core curriculum courses, graduation rate, retention and mission-specific goals.
But while the state's top education official, Eric Fingerhut, and others have championed the incentive-based program, similar funding models in other states have been short-lived.
Of the 26 states that have adopted similar models since 1979, 12 have canned them, according to a study conducted by Kevin Dougherty, an associate professor at Columbia University.
According to his findings, states ditch performance-based models in times of economic crisis or once the model loses the support of the state's universities and legislators.
Dougherty noted the 30 percent of funding Ohio will tie to performance factors is unprecedented, adding that the most any state has committed to performance funding in the past was 5 percent.
One factor in the short-lived nature of these systems is a lack of support from the schools, Dougherty said, adding in many states performance models were introduced without their support. Top level Ohio University administrators have expressed support for the model, but faculty members voiced reservations at an April Faculty Senate meeting.
The new SSI - the state share of instruction - the new formula that is being developed will give money to institutions not based on the number of students we enroll but based on the number of students who succeed - meaning the number of students we pass. ... This sounds like D is the new F
outgoing Faculty Senate Chairman Sergio López-Permouth said.
About 18.4 percent of OU's current $657.8 million budget comes from state funding. Next fiscal year, OU anticipates receiving about $126 million in state funding, a 4 percent increase.
The main reason performance funding models fail is an economic downturn, and Ohio's current financial situation could make it hard to retain the new model, Dougherty said.
In many cases when states are forced to cut higher education funding, schools push for performance-based funds to be cut before other state aid to avoid the costs of competing under those models.
If Ohio can pull it off despite the current economic situation ... it would be quite interesting Dougherty said.
Fingerhut noted support for higher education from Gov. Ted Strickland as a reason for going forward with the new model despite the current economic climate.
We've seen extraordinary support for higher education even in the midst of the economic downturn he said. The commitment is real and substantial
and the economy hasn't affected that.
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Wesley Lowery
