Board of Regents’ performance-based funding model faces uncertainty

Matthew Rezab

The Iowa Board of Regents’ performance-based funding proposal has caught a snag in the Iowa Legislature. The education bills passed by the Senate on April 29 and the House on April 30 do not include the Regents’ model.

The bills did include additional funding for the University of Northern Iowa and instructed the regents to freeze tuition for the third consecutive year.

The new system would replace the current “base-plus” model and use performance and enrollment measurements to determine funding for each university. If the new model is approved by the state legislature Iowa State and the University of Northern Iowa will be awarded a larger portion of state funds, while the University of Iowa’s funding would be decreased.

The new funding model would allocate funds by:

• Resident enrollment – 60 percent

• Student progress and attainment – 15 percent

• Access for low-income and minority students – 10 percent

• Sponsored research – 5 percent

• Graduate and professional students – 5 percent

• Other selected metrics – 5 percent

Opponents say the new model is dead in the water this session because neither bill passed this week included language.

Proponents, such as Regent Larry McKibben of Marshalltown said it’s too early to tell until an agreement has been met by Gov. Branstad and both houses of the legislature.

David Miles, chair of the task force charged with studying the feasibility of the new performance-based funding, told the Regents last June the base-plus model was not well designed to align with state priorities.

If passed, the new model would redistribute approximately $12.9 million from the University of Iowa in the next fiscal year. Northern Iowa would see an increase of $6.3 million and Iowa State an increase of $6.6 million. The regents requested $12.9 million in extra funding to offset the costs to the University of Iowa.

“Performance-based funding would benefit both Iowa State and UNI, and would recognize, rather than penalize, our growth and percentage of Iowa students. And, for the first time, it would show the taxpayers of Iowa why various allocations are made to each Regent university. Performance-based funding is a long-term solution to a decades-old funding inequity and places all three universities on a path to success by aligning variable costs with variable revenues,” said a joint letter advocating for the change released by ISU President Steven Leath and UNI President Bill Ruud.

The funding changes would be implemented over three years, beginning at the start of fiscal year 2016. No more than $13 million dollars annually can be reallocated from any school each year.