School Finance

College performance funding plan approved

Updated Dec. 5 – The initial structure of how Colorado colleges and universities would be financially rewarded for increasing graduation rates and achieving other key goals were unanimously approved Thursday by the Colorado Commission on Higher Education.

Colorado college campus montage
From left, Colorado State University in Fort Collins, the University of Colorado-Boulder and the Auraria Higher Education Center.

The plan, under development for several months by Department of Higher Education staff and outside consultants, was discussed and voting on during a commission meeting in Colorado Springs.

The discussion takes place at the same time as the financial health of state colleges and universities may be coming under closer scrutiny at the Capitol.

In a presentation to the legislative Joint Budget Committee Tuesday, a staff analyst warned about increasing debt loads at state colleges, particularly at Adams State University in Alamosa and Western State Colorado University in Gunnison. The issue is expected to be a key topic when the committee holds a daylong hearing with CCHE and institution leaders on Dec. 12. (See details at the bottom of this article.)

A 2011 law created – but didn’t implement – a performance funding system for state colleges and universities. Like so many aspirational legislative proposals, lack of funds required the authors to delay implementation until direct state support for higher education returns to $706 million a year and no earlier than 2016-17. College funding was slashed during the recession and currently is below $660 million. Under the terms of the law 25 percent of funds above $650 million are to be allocated based on institutional performance, with the bulk still distributed by traditional enrollment-based formulas.

In the meantime, the law assigned the CCHE to come up with a new higher education master plan and to develop a proposal for how to divvy up any future performance funding.

The master plan, completed a year ago, has four main goals – increased production of degrees and credentials, improved student success, reduction of completion gaps between demographic groups and restoring the system’s financial health.

After that document was finished, DHE and individual colleges and systems negotiated performance contracts outlining how individual campuses would work toward those goals. Those contracts currently carry no financial rewards or punishments because the performance funding part of the law hasn’t kicked in.

Peformance funding graphic
Click to view large version

But the allocation plan presented to the commission would build on those contracts and broadly work like this:

  • Data would be collected and points assigned for each metric associated with the four goals in a college’s contract.
  • Points would be weighted according to the weights used by colleges in their contracts. (Colleges have a wide variety of different strategies in metrics in their contracts, so one college might emphasize a certain completion strategy that’s not emphasized as strongly by another institution.)
  • Weighted points then would be scaled to account for the relative sizes of institutions and systems.
  • Shares of performance funding would be allocated from the funds available.

Institutions could receive reduced credit for goals that were partially achieved. An institution meeting a higher percentage of its goals would receive a higher percentage of the total performance funding pool compared to the other colleges and universities that met a lower percentage of their metrics.

The DHE staff proposal identified several challenges to the new system, including:

  • The relatively low amount of performance funding might not be enough to change institutional behavior.
  • The need to balance varying individual college plans with statewide goals makes for complicated allocation tool that may not be transparent to the public.
  • Making consistent measurements may be hard, given the large number and variety of metrics used by colleges in their contracts.
  • The variation in colleges’ goals and metrics may lead to perceptions that performance contracts are weak.
  • And last but not least, “Funding levels adequate to trigger performance funding may not be realistic for several years.”

Under the plan, the first reporting of institutional performance will come in December 2014, and the system and the contracts will be reviewed in the fall of 2015.

Both DHE staff and commissioners agreed that additional details of the plan need to be worked out over the next two years.

Other key business for CCHE

The agenda for the CCHE meeting at Colorado College included two other key decision items, changes to the state’s college admissions policy and a new policy for remedial education. Both were approved.

The admissions policy would give institutions more flexibility in admissions standards, although those would have to be approved by the commission. Factors in those policies would have to include test scores such as SAT and ACT, student grade point averages and the rigor of high school classes taken by students.

The new policy eliminates the old admissions index, a numerical combination of test scores, GPA and class ranking that has been used to indicate to applicants which colleges might admit them. The policy is intended to better align college admissions policies with the state’s new high school graduation guidelines (get background in this EdNews story.)

The new policy would go into effect for students entering college in the fall of 2019.

State colleges currently determine whether a student needs remedial work in English or math based on cut scores on college entrance exams. Such students have to take remedial classes before they can enroll in credit courses. The new policy would maintain existing cut scores but broaden the number of exams used and give colleges flexibility in allowing students to take credit courses while receiving supplemental tutoring or other instruction in areas where they need help.

The commission also was briefed on what’s expected to be the hottest higher education issue of the 2014 legislative session – allowing community colleges to offer a limited number of four-year degrees in applied sciences fields. Some commissioners indicated general support, but the CCHE didn’t take formal action. Read a staff memo here, and get more background in this EdNews story.

Sober warning for JBC

Members of the JBC got an eye opening warning this week when they received their annual pre-session briefing on proposed higher education spending in 2014-15.

Staff analyst Amanda Bickel’s briefing paper noted that as of budget year 2011-12, “six out of 10 of Colorado’s governing boards were in relatively weak financial health, based on Composite Financial Index scores commonly used to assess financial health in this sector. Two small institutions—Adams State University and Western State Colorado University—had scores below 0, indicating a need to ‘assess institutional viability to survive.’ Both institutions are highly leveraged.”

Get the details

The document continued that analysis of Adams and Western from 2008-09 to 2012-13 “indicates that both institutions are highly leveraged and financially at risk.”

Bickel recommended that the legislature and the executive branch keep a close eye on the financial health of those colleges, the state system’s smallest, and that the committee should more carefully monitor colleges’ requests to issue bonds under a state guarantee called the Higher Education Revenue Bond Intercept program.

She also made the provocative suggestion that “the General Assembly should explore whether any of the state’s larger higher education systems are interested in merging with the smaller institutions highlighted in this issue, given the larger systems’ economies of scale and resources for implementing changes in a challenging financial environment.”

In the recent years of shrinking state financial support many state colleges have built or renovated new facilities with bonds that are to be repaid by revenues from such sources as student fees. There’s been something of an “arms race” among colleges to improve facilities in order to attract students.

Bickel’s analysis, which she repeated in comments during the meeting, naturally got the committee’s attention.

“I think this struck terror in a lot of hearts, but it’s a good thing,” said panel member Rep. Cheri Gerou, R-Evergreen. “I’m not going to sit here and pick on Adams State and Western State. … The state hasn’t carried its load in supporting higher education.”

Bickel also had some other interesting suggestions for the committee, including that it ask for written commitments from colleges to limit 2014-15 tuition increases to no more than 6 percent, something they have promised Gov. John Hickenlooper. She also recommended that the legislature consider revisiting a law that allows colleges to raise tuition by 9 percent a year – or higher with CCHE approval.

And she suggested that the JBC consider putting into need-based scholarships the $5 million that Hickenlooper wants to earmark for merit awards, and that the legislature put pressure on colleges to devote more of their own money to need-based scholarships.

Some JBC analysts are know for the thought-provoking proposals they include in the December briefing papers, ideas that spark a lot of committee discussion but don’t necessarily make it into the state budget approved every April.

The committee has its normal pre-session hearing with college leaders next week and also may schedule additional meetings on the debt issue raised by Bickel.

choosing leaders

Meet one possible successor to departing Denver superintendent Tom Boasberg

PHOTO: Melanie Asmar
Denver Public Schools Deputy Superintendent Susana Cordova addresses teachers at an early literacy training session.

As Denver officials wrestle with how to pick a replacement for longtime superintendent Tom Boasberg, one insider stands out as a likely candidate.

Susana Cordova, the district’s deputy superintendent, already held her boss’s job once before, when Boasberg took an extended leave in 2016. She has a long history with the district, including as a student, graduating from Abraham Lincoln High School, and as a bilingual teacher starting her career more than 20 years ago.

When she was selected to sit in for Boasberg for six months, board members at the time cited her hard work and the many good relationships they saw she had with people. This time around, several community members are saying they want a leader who will listen to teachers and the community.

Cordova, 52, told Chalkbeat she’s waiting to see what the board decides about the selection process, but said she wants to be ready, when they are, to talk about her interest in the position.

“DPS has played an incredibly important role in every aspect of my life. I’m very committed to making sure that we continue to make progress as an organization,” Cordova said. “I believe I have both the passion and the track record to help move us forward.”

During her career, she has held positions as a teacher, principal, and first became an administrator, starting in 2002, as the district’s literacy director.

Just before taking on the role of acting superintendent in 2016, Cordova talked to Chalkbeat about how her education, at a time of desegregation, shaped her experience and about her long path to connecting with her culture.

“I didn’t grow up bilingual. I learned Spanish after I graduated from college,” Cordova, said at the time. “I grew up at a point in time where I found it more difficult to embrace my Latino culture, academically. There were, I would say, probably some negative messages around what it meant to be Latino at that point of time.”

She said she went through introspection during her senior year of college and realized that many students in her neighborhood bought into the negative messages and had not been successful.

“I didn’t want our schools to be places like that,” she said.

In her time as acting superintendent, she oversaw teacher contract negotiations and preparations for asking voters for a bond that they ultimately approved that fall. Cordova’s deputy superintendent position was created for her after Boasberg returned.

But it’s much of Cordova’s work with students of color that has earned her national recognition.

In December, Education Week, an education publication, named her a “Leader to Learn From,” pointing to her role in the district’s work on equity, specifically with English language learners, and in her advocacy to protect students under the Deferred Action for Childhood Arrivals program, or DACA.

Cordova was also named a Latino Educator Champion of Change by President Barack Obama in 2014. Locally, in 2016, the University of Denver’s Latino Leadership Institute inducted Cordova into its hall of fame.

The Denver school board met Tuesday morning, and again on Wednesday to discuss the superintendent position.

Take a look back at a Q & A Chalkbeat did with Cordova in 2016, and one in 2014.

School Finance

IPS board votes to ask taxpayers for $315 million, reject the chamber’s plan

PHOTO: Dylan Peers McCoy

Indianapolis Public Schools officials voted Tuesday to ask taxpayers for $315 million over eight years to help close its budget gap — an amount that’s less than half the district’s initial proposal but is still high enough to draw skepticism from a local business group.

The school board pledged to continue discussions in the next week with the Indy Chamber, which released an alternative proposal last week calling for massive spending cuts and a significantly smaller tax increase. The school board rejected the proposal as unrealistic and instead voted to add a much larger tax measure to the November ballot.

If the school board and the chamber come to a different agreement before the July 24 meeting, the board can change the request for more taxpayer money before it goes to voters. Some board members, however, were dubious that they would be able to find common ground.

“While I appreciate the fact that we want to continue to negotiate, I’m pretty sure that I’m at rock bottom now,” said school board member Kelly Bentley. “That initial proposal by the chamber is, unfortunately in my mind, it’s insulting. It’s insulting to our children, and to our neighborhoods, and to our families.”

Chamber leaders, whose support is considered important to the referendum passing, were skeptical about the dollar amount. In a press release, the group said the district was “taking another step towards seeking a double-digit tax increase.”

“We’re concerned that our numbers are so divergent,” said chamber president and CEO Michael Huber in the statement. “We need to study the assumptions behind the $318 million request; clearly the tax impact is significant and the task of winning voter support will be challenging.”

During the board meeting, which lasted more than two hours, district leaders discussed why schools need more money and why the chamber report is unrealistic. They also took comments from community members who were largely supportive of the tax increase.

Joe Ignatius, who mentors students through 100 Black Men of Indianapolis, said that he has seen the benefits of more funding from referendums in other communities.

“This should be a no brainer, to invest in our future for the students,” Ignatius said. “Don’t think about the immediate impact of the dollars that may come out of your pocket but more the long-term impact.”

If the district goes forward with its plan, and voters approve the tax increase, the school system would get as much as $39.4 million more per year for eight years. A family with a home at the district’s median value — $75,300 — would pay about $3.90 more per month in property taxes. (Since the initial proposal, the district reduced the median home value used in calculations on the advice of a consultant.)

The district plan comes on the heels of months of uncertainty. After the school board abandoned its initial plan to seek nearly $1 billion for operating expenses and construction, district officials spent weeks working with the Indy Chamber to craft a less costly proposal. Last month, the board approved a separate referendum to ask taxpayers for about $52 million for school renovations, particularly school safety features.

But the groups came to different conclusions about how much money the district needs for operating expenses.

The chamber released an analysis last week that called for $477 million in cuts, including eliminating busing for high school students, reducing the number of teachers, closing schools, and cutting central office staff. The recommendation also included a $100 million tax increase to fund 16 percent raises for teachers.

District officials, however, say the cuts proposed by the chamber are too aggressive and cannot be accomplished as quickly as the group wants. The administration and board members spent nearly an hour of the meeting Tuesday discussing the chamber plan, why they believe it’s methodology is wrong, and the devastating consequences they say it would have on schools.

Even if the $315 million plan proposed by the district passes, it will come with some sacrifices compared to the initial plan. Those cuts could include: reduced transportation for magnet schools, field trips, and after school activities; school closings; increased benefits costs for employees; and smaller pay increases for teachers and employees.

The district did not make a specific commitment to how much teacher pay would increase if the amount asked for in the referendum is approved, but Superintendent Lewis Ferebee said the funds would pay for consistent raises.

“We would be at least addressing inflationary increases and cost of living, but we hope that we can be higher than that,” said Ferebee. “It would depend a lot on what we are able to realize in savings.”

The school board’s decision to rebuff the chamber’s recommendation puts the district in a difficult position. The chamber has no official role in determining the amount of the referendum, but it could be a politically powerful ally.

Last week, Al Hubbard, an influential philanthropist and businessman who provided major funding for the chamber analysis, said that if the district seeks more money than the group recommended, he would oppose the referendum.

The total tax increase would vary for each homeowner within district boundaries. The operating increase would raise taxes by up to $0.28 for every $100 of assessed property value, while the construction increase would raise taxes by up to $0.03 per $100 of assessed property value.