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Higher Education Coordinating Council -Draft Recommendation #1

Accountability & Performance Measures

This memo is drafted to provide an ICUF perspective to current performance and accountability issues and to inform our ICUF member institutions on these same issues. At ICUF we embrace measurement of performance as we have produced an annual accountability report for more than a decade. However we do have concerns about an application of a common system throughout four sectors when each is very different and each has very different funding models and the strength of Florida’s higher education options have been built through this diversity.

For the past two years, the Higher Education Coordinating Council (HECC) has been discussing and attempting to determine if there are any broader applications of the State University System’s Performance-Based Funding Project to recommend to the Legislature, Board of Governors and State Board of Education. ICUF representatives have indicated at several council sessions,and to council staff members of the other higher education systems represented on the council,their concerns about this project’s intended consequences, unintended consequences and exportability to private sector systems, especially because the state monies that flow to the ICUF system, in the main, go directly to students in the form of student financial aid programs. HECC as a council has been in agreement that funding for student financial aid did not fit into the current performance system and that perhaps new monies for other types of programs are better suited. This memo from ICUF further discusses those issues.

Until such time as programs develop that do fit within these matrices it might be more useful to reflect upon the statutory charge for HECC, with a greater focus upon coordinative activities. Regarding performance measures,tous it seems that broader issues of coordination and a focus upon variables that have direct consequences and potentially detrimental effects upon higher education access and delivery within Florida, such as federal actions, have broad implications and warrant much greater attention. This is why we have long advocated a federal focus, and coordinating a Florida response to issues of concern and opportunity, especially because coordination is a primary charge for HECC.

HECC discussions on performance measurement have gone through several stages: reviewing the SUS initial theory, reviewing the SUS initial proposal, reviewing the recommendation that the FCS, ICUF and FAPSCdevelopa version similar to the SUS project, reviewing the SUS modified second-year proposal, reviewing the FCS first-year proposal development and now considering a proposed common list of performance measuresapplicable to all systems, as well as lists of system-specific performance measures. HECC has been in general agreement that student assistance programs do not fit into metric analysis as easily as block grant or base funding. Our advocacy has been that any new base funding, block funding, or RFP funding programs should come with performance metrics from the start.

TheSUSproject and the FCS proposalresurrect and resemble similarpast projects, including the Performance Budgetingof last decade, Performance Based Funding for Community Colleges in the late 1990s and Governor Chiles’ GAP Commission work in the early 1990s. They also resemble the performance measurement proposals that the Obama Administration is currently advocating. Their funding inducement design for various Executive, Legislative and Agency priorities is often used to add emphasis or focus on existing priorities or new priorities such asthe past inducements to produce more teachers at state colleges and universities for anticipated shortages, to produce more nursing BSNs and MSNsat state colleges and universities,or to increase private capital contributions with matching state funding.

The SUS project was a funding request recommended by the Board of Governors to the Legislature to award additional funding to those SUS institutions that emphasize and perform better on a short listof the BOG and State Universities’ highest priorities. Last year, the Legislature appropriated $100 million with proviso language to begina demonstration of the impactof thisSUS project, itsdesign, methodology, measures and data. The hope and expectation was that the SUS institutions would, over time, improve their performance on these targeted measures.

This year, the SUS requested an additional $100 million, and the Florida College System was engaged in a similarproject, with a suggested cost of $60 million. Both the SUS and FCS were also seeking statutory enactment in law of their performance-based funding projects. The SUS had recommended some adjustments to the measures for the project’s second year. They are now pending approval for the upcoming fiscal year (until such time as the 2015-16 budget is approved we do not have final values).

Pending in the SUS appropriation proviso and statutory proposalsare new loan-default measures added to last year’s SUS design. There were also different measures added to the FCS recommended statutory proposal and budget proviso, which included loandefaults.

Funding from the state to ICUF institutions mostly flowsthrough students to their chosen institutions viaseveral student aid programs. If we were to see this on a new fund request outside of student aid, the following would besome ideas and limitations.

  • An ICUF Legislative Budget Requestcomparable to the first SUS LBR, given ICUF’s degree mix and number of students, would have been $43 million, but the ICUF sector is not funded that way.
  • The SUS demonstration design is calibrated to induce better performance from large public state universities that receive large system-wide operational subsidies. It does not articulate to system-wide student financial aid that is awarded to eligible Florida students who often proceed through several colleges and universities. ICUF receives no system-wide operational subsidies. It only receives system-wide student financial aid through our eligible Florida resident students: Bright Futures, the Florida Student Assistance Grants (FSAG) and the Florida Residents Access Grant (FRAG). Only approximately 25% ofthe total ICUF college and universitystudents receive state aid.
  • The Legislature has already adoptedspecific accountability and performance measurement requirements for the three student financial aid programs in law and recurring proviso. For example, The FRAG goes only to full-time Florida resident students. A student can receive the FRAG for no more than 9 semesters. By law and budget proviso, ICUF must annually file a FRAG Accountability Report with the Legislature and Governor that includes FRAG student access, attainment and attachment to employment performance measures. These include retention rates, transfer rates, completion rates, graduation rates, employment and placement rates, and earnings of graduates.
  • ICUF has for decades voluntarily exceededthe statutory, budget, regulatory, guidelineand accountability requirements of the Legislature, the Governor and FLDOE without inducement. In addition, ICUF iscompleting accountability and performance profiling designs of its colleges and universities viaUCAN,which isavailable on the ICUF website for students, parents and counselors.

At HECC we might find it useful todiscuss furtherhow changes in higher education delivery systems might need to be contemplated within any future performance measurement system.

  • Measures - Some measures will be imprecise or inappropriate for all institutions. For example, federal IPEDSdata that focuses primarily on First-Time-in-College (FTIC) students may not capture correctly large numbers of non-traditional students in many Florida colleges and universities. IPEDS datahas worked better for traditional destination universities such as UF and FSU.

Time-to-degree measures are also increasingly inequitable as increasingly high school students are arriving at colleges and universities with many college credits but are counted as FTIC enrollees.

Likewise with students increasingly transferring to two or more institutions, FTIC data loses track of these students and fails to credit their degree completion adequately. Failing to retain a student sometimes means that the student has dropped out, but it also often means that they have simply relocatedto complete their degree elsewhere.

Florida has increasingly focused on capturing returning students, such as the innovative project at UWF. With the growth of the non-traditional student, this makes data elements such as FTIC retention and graduation diminished in relevance, especially for many schools with large segments of these students.

A good example of this as a problem area is the HECC project being undertaken by ICUF, focusing on 2+2 transfer issues and pathways to degree completion, which seem to run counter to the common usage of time-to-degree and graduation rates, as does the increasingly diverse composition of students attending our institutions, especially the huge growth in non-traditional, working, and part-time populations.

  • The Florida Education & Training Information System (FETPIP) – This isa unique and important accountability tool in Florida, which often unfortunately determines and reports on earning levels from career jobs that preceded degree completion (likely to be an increasing problem as the fast growing segment of students returning to school later in life tends to skew this data set) and on post-graduation employment that is not in the career path of a graduate’s degree.
  • Cost of degree - Comparisons between state and private institutions require consideration of student costs directed by the Legislature, and student costs driven by market competition. There is also the issue of comparisons of the costs taxpayers pay for students at state institutions versus students at private institutions, as well as costs paid by consumers.A study many years ago by McKinsey focused on an element called Return on State Funding (ROSF), but it was decided after publication that sector-to-sector comparisons regarding costs were much too complex and differentiated to use.
  • Data –Somemeasures induce institutions to focus increasingly on students more likely to graduate swiftly and not on more challenged students, which would include part-time students, non-traditional students, lower-income students, disabled students and other minority populations of students who often take longer to complete their degrees. Many ICUF schools have a large focus on these communities of students. This outreach should be encouraged, but depending upon how metrics are set, this kind of focus might suffer.

On this more current design recommendation, a common list of measures for all and a separate list of each systems’ specific measures is less prescriptive than previous recommendations. Such a design could be used to compare the University of Florida and University of Miami which are ranked the 48th and 49th best national universities in the nation, respectively, by U.S. News & Report. It is less clear how this new recommendation would promote comparisonof Keiser University or Nova Southeastern University, with multiple campuses statewide, to an FCS or SUS institution with one large primary location or several small branches within a service area. How would this current design recommendation more clearly portraythe performance success of Florida Institute of Technology, which is a STEM university, with an FCS school, which awards almost exclusively certificates, AS degrees and AA degrees? And so forth.

Wesuggest avoidingany performance-measurement design that mandates uniformityof Florida’s four higher education systemsout of concern that our diversity of institutions is our strength,offering access to higher education for all. Too much conformity may tend to stifle innovation and outreach. These systems have different missions, different strategies, different designs, different sizes and different students. Allowing and supporting that diversity has been the successful collaborative genius of past governors and legislatures. Today, because of their wisdom, Florida now has four different higher education systems and four different Florida higher education success stories. Our diversity has spawned record outputs, innovations, and market driven responses, an example of which is the 425 fully online degree programs offered by 21 of the ICUF institutions.

Performance-Based FundingProjectslikely will prove to be a nation-leading innovation for large state universities. The FCS Project may likely prove itself a nation-leading innovation for the more diverse community and state colleges. But each of Florida’s four higher education systems is challenged to create its own innovations for its own unique system’s institutions. Such innovative and independent research is imbedded in higher education’s core mission and passion. Non-uniformityis a strength. ICUF continues to grow and expand at a low cost to taxpayers, offering increased market driven solutions. Over-regulation does not foster creativity and access.

The chairman has called for forthright discussions in the search for a consensus HECC recommendation, from and for all. This memo and its commentary of the SUS and FCS demonstration projects is presented in that spirit. At the heart of theseHECC discussions is the search for a recommendation for two public-sector higher education systems and two private-sector higher education systemsthat producegraduatesinFlorida. Two of those systems receive system-wide,varied operational appropriations directly and student financial aid for their undergraduates, and two of these systems receive no system-wideoperational appropriations, with undergraduate student financial assistance for only some of its students. ICUF does not think we are ready for a consensus recommendation that fits all sectors, nor is one appropriate for all.

As for accountability points, we have always embraced accountability and we do suggest we continue to monitor the following focused variables included in our annual report (retention rates, transfer rates, completion rates, graduation rates, employment and placement rates, and earnings of graduates) to the Governor and Legislature, even as we suggest that some data points, as has been mentioned, such as graduation rates and time-to-degree, have decreasing validity in the current market place. We instead would suggest a more output-driven metric that places a focus on degree production over a rolling period by each institution, with explanations about changes in outputs that might offer better indicators across time. A good example of this is our recent report on all Florida institutions producing 16% fewer teachers over the past decade. This warrants a deeper look, since this might portend a pending crisis in a state growing in excess of 800 people a day. We also think our systemic focus on minority and lower income access is a critical point for meeting the diverse needs of our state.

We look forward to continuing our robust discussions on these issues as we work toward improving and increasing access to postsecondary opportunities in Florida. Each sector plays a vital, yet very different role on meeting the needs of Florida.

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