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Regular Session, 2010
SENATE BILL NO. 570
BY SENATORS CHAISSON, APPEL, DONAHUE, DUPLESSIS, MARTINY AND
QUINN AND REPRESENTATIVES ARNOLD, BOBBY BADON,
HENRY BURNS, TIM BURNS, CARMODY, CARTER,
CHAMPAGNE, CONNICK, DOVE, GISCLAIR, HARDY, HINES,
HOFFMANN, KATZ, LABRUZZO, LIGI, ROBIDEAUX, SIMON,
SMILEY, WILLIAMS AND WOOTON
POSTSECONDARY ED. Provides for the La. Granting Resources and Autonomy for
Diplomas Act ("LA GRAD" Act). (gov sig)
AN ACT1
To amend and reenact R.S. 17:3386(A) and (D) and to enact R.S. 17:3139 and 3386(E),2
relative to public postsecondary education; to provide for the Louisiana Granting3
Resources and Autonomy for Diplomas Act; to provide for performance agreements4
between the Board of Regents and public postsecondary education institutions; to5
provide for the effectiveness, review, revocation, and renewal of such agreements;6
to provide for autonomies granted to institutions that enter into such agreements; to7
require specified performance objectives to be met as part of such agreements; to8
provide for monitoring and reporting by the Board of Regents; to exempt certain9
institutions from requirements relative to the use of surplus funds and the carrying10
forward of certain state general funds; and to provide for related matters.11
Be it enacted by the Legislature of Louisiana:12
Section 1. R.S. 17:3386(A) and (D) are hereby amended and reenacted and13
R.S. 17:3139 and 3386(E) are hereby enacted to read as follows:14
§3139. Louisiana Granting Resources and Autonomy for Diplomas Act;15
purpose; agreements; monitoring and renewal; reporting16
A. Title. This Act shall be known and may be cited as the "Louisiana17 SB NO. 570
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Granting Resources and Autonomy for Diplomas Act."1
B. Purpose. The purpose of this Section is to support the state's public2
postsecondary education institutions in remaining competitive and increasing3
their overall effectiveness and efficiency by granting the institutions limited4
operational autonomy and flexibility provided that the institutions achieve5
specific, measurable performance objectives aimed at improving college6
completion and meeting the state's current and future workforce and economic7
development needs.8
C. Performance agreements; objectives. Effective beginning with the9
2011 Fiscal Year, any public postsecondary education institution may enter into10
an initial performance agreement with the Board of Regents in order to be11
granted limited operational autonomy and flexibility as provided in Subsection12
E of this Section in exchange for committing to meet all of the following13
performance objectives as applicable to the institution as determined by the14
Board of Regents:15
(1) Student success. (a) Achieve cohort graduation rate goals that are16
consistent with institutional peers. For purposes of this Section, peer17
institutions shall mean those institutions as defined by the Board of Regents in18
accordance with R.S. 17:3351(A)(5)(e)(i).19
(b) Increase the number of program completers at all levels each year.20
(c) Develop partnerships with high schools to prepare students for21
postsecondary education.22
(d) Increase passage rates on licensure and certification exams and23
workforce foundational skills.24
(2) Articulation and transfer. (a) Phase in increased admission25
standards and other necessary policies in order to increase student retention26
and graduation rates.27
(b) Provide feedback to community colleges and technical college28
campuses on the performance of associate degree recipients enrolled at the29 SB NO. 570
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institution.1
(c) Develop partnerships with community colleges and technical college2
campuses to admit students who initially fail to qualify for admission into the3
institution after they have earned an associate degree from a community college4
or technical college campus.5
(d) Demonstrate collaboration in implementing the articulation and6
transfer requirements as provided in R.S. 17:3161 through 3169.7
(3) Workforce and economic development. (a) Eliminate academic8
programs that have low student completion rates and are not aligned with9
current or strategic workforce needs of the state, region, or both.10
(b) Increase the use of technology for distance learning to expand11
educational offerings.12
(c) Increase research productivity especially in key economic13
development industries and technology transfer at research institutions to levels14
consistent with the institution's peers.15
(d) Demonstrate progress in increasing the number of students placed16
in jobs, and the performance of associate degree recipients who transfer to17
institutions that offer academic undergraduate degrees at the baccalaureate18
level or higher.19
(4) Institutional efficiency and accountability. (a) Phase out remedial20
education course offerings and developmental study programs unless such21
courses or programs cannot be offered at a community college in the same22
geographic area.23
(b) Phase out associate degree programs unless such programs are not24
offered at a community college in the same geographic area.25
(c) Adhere to a schedule established by the institution's management26
board to increase nonresident tuition amounts that are not less than the average27
tuition amount charged to Louisiana residents attending peer institutions in28
other Southern Regional Education Board states and monitor the impact of29 SB NO. 570
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such increases on the institution.1
(d) Designate centers of excellence as defined by the Board of Regents2
which have received a favorable academic assessment from the Board of3
Regents and have demonstrated substantial progress toward meeting the4
following goals:5
(i) Offer a specialized program that involves partnerships between the6
institution and business and industry, national laboratories, research centers,7
and other institutions.8
(ii) Are aligned with current and strategic statewide and regional9
workforce needs as identified by the Louisiana Workforce Commission and10
Louisiana Economic Development.11
(iii) Have a high number of graduates or completers each year as12
compared to the state average number of graduates and that of the institution's13
peers.14
(iv) Have a high number of graduates or completers who enter15
productive careers or continue their education in advanced degree programs.16
(v) Have a high level of research productivity and technology transfer.17
(5) Any additional performance objectives as determined by the Board18
of Regents.19
D. Annual review; revocation. The initial performance agreement and20
each subsequent agreement shall be a six-year agreement and shall be reviewed21
annually by the Board of Regents. The Board of Regents may revoke an22
agreement at any time if it determines that an institution has failed to abide by23
the terms of the agreement.24
E. Autonomies granted. Each institution that enters into an agreement25
as provided in this Section shall be granted all of the following:26
(1) The authority to:27
(a) Increase tuition and fee amounts by up to ten percent annually,28
without legislative approval, until the institution reaches the average tuition and29 SB NO. 570
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fee amounts of its peer institutions.1
(b) Upon reaching the average tuition and fee amounts as specified in2
Subparagraph (a) of this Paragraph, increase tuition and fee amounts by up to3
five percent annually or by an amount equal to the increase in the Higher4
Education Price Index in the previous year, whichever is greater.5
(c) Impose all or some tuition and fee charges on a student credit hour6
basis.7
(2) A base level of operational autonomy as determined by the Board of8
Regents subject to the approval by the division of administration which, at a9
minimum, shall include greater flexibility in:10
(a) Carrying forward unexpended and unobligated funds from one fiscal11
year to the next.12
(b) Procurement of information technology products and services.13
(c) State travel regulations.14
(3) The Board of Regents, in collaboration with the division of15
administration, shall identify additional operational autonomies, including but16
not limited to procurement and construction, and may grant such autonomies17
to an institution during the initial agreement period if all of the following are18
met:19
(a) After three years, the institution has achieved a sufficient number of20
the performance objectives provided in Subsection C of this Section as21
determined by the Board of Regents.22
(b) The institution has demonstrated the ability to successfully operate23
with the base levels of autonomies granted by this Section as determined by the24
Board of Regents.25
F. Monitoring; reporting; renewal. (1) The Board of Regents annually26
shall monitor and report to the legislature and the governor on each27
participating institution's progress in meeting the performance objectives as28
specified in Subsection C of this Section. At the end of the initial agreement29 SB NO. 570
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period and each subsequent agreement period, the Board of Regents shall1
determine whether to renew an institution's performance agreement. Such2
determination shall be based on the recommendations of a review panel3
established by the Board of Regents to conduct a comprehensive review and4
evaluation of the institution's progress in meeting the performance objectives.5
The composition of the review panel shall be the same as is provided in R.S.6
17:3138(C).7
(2) If an institution's initial performance agreement is renewed for a8
second six-year period, the institution in exchange shall:9
(a) Further increase cohort graduation rate goals as specified in10
Subparagraph (C)(1)(a) of this Section including the following, as applicable:11
(i) A graduation rate of at least seventy-five percent for any institution12
classified as a "Four-Year 1" institution by the Southern Regional Education13
Board.14
(ii) A graduation rate of at least sixty percent for any institution15
classified as a "Four-Year 2" institution by the Southern Regional Education16
Board.17
(iii) A graduation rate of at least fifty percent for any institution18
classified as a "Four-Year 3," "Four-Year 4," or "Four-Year 5," institution by19
the Southern Regional Education Board.20
(iv) For any community college and technical college campus, a21
graduation rate that is at least equal to the Southern Regional Education Board22
average for peer institutions.23
(b) Continue to make progress in meeting all other performance24
objectives as contained in the initial agreement.25
(c) Meet any additional performance objectives as determined by the26
Board of Regents.27
(3) If an institution's performance agreement is renewed for subsequent28
periods following the first renewal period, the institution in exchange shall:29 SB NO. 570
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(a) Maintain the same graduation rates as specified in Paragraph (2) of1
this Subsection.2
(b) Continue to make progress in meeting all other performance3
objectives as contained in the initial agreement.4
(c) Meet any additional performance objectives as determined by the5
Board of Regents.6
* * *7
§3386. Surplus funds; retention; use; exceptions8
A. Any Except as otherwise provided by this Section, any public college9
or university or any consortium of colleges and universities which adopts a building10
and facility preventative maintenance program approved by the Board of Regents11
may retain any funds appropriated or allocated to such college, university, or12
consortium thereof from the state general fund which remain unexpended and13
unobligated at the end of the fiscal year, provided that not less than fifty percent of14
such retained funds shall be maintained by the college, university, or consortium15
thereof in a preventative maintenance reserve fund. Monies fund, and the monies16
from such reserve fund shall be used solely for preventative maintenance purposes17
in accordance with the approved plan. Retained funds shall only be spent on18
nonrecurring projects and such expenditures are subject to approval by the19
appropriate higher postsecondary education management board, the Board of20
Regents, and the Joint Legislative Committee on the Budget. Such expenditures21
shall be contained in a report submitted to the Board of Regents no later than22
September fifteenth.23
* * *24
D. No Except as otherwise provided by this Section, no public higher25
postsecondary education institution as provided in Subsection A of this Section may26
carry forward more than two percent of its prior fiscal year's state general fund27
appropriation or allocation under the provisions of Subsections A and B of this28
Section.29 SB NO. 570
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E. The provisions of this Section requiring at least fifty percent of1
retained funds to be maintained in a reserve fund and used only for2
preventative maintenance purposes and prohibiting more than two percent of3
certain state general fund appropriations or allocations from being carried4
forward shall not apply to any public postsecondary education institution5
entering into a performance agreement pursuant to R.S. 17:3139 if the6
agreement so provides.7
Section 2. This Act shall become effective upon signature by the governor or, if not8
signed by the governor, upon expiration of the time for bills to become law without signature9
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If10
vetoed by the governor and subsequently approved by the legislature, this Act shall become11
effective on the day following such approval.12
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Jeanne C. Johnston.
DIGEST
Proposed law provides for the La. Granting Resources and Autonomy for Diplomas Act (La.
GRAD) as follows:
Performance agreements and objectives. Authorizes public postsecondary education
institutions to enter into initial performance agreements with the Board of Regents in order
to be granted limited operational autonomy and flexibility in exchange for committing to
meet performance objectives as applicable to the institution. Such objectives are categorized
relative to student success, articulation and transfer, workforce and economic development,
and institutional efficiency and accountability and generally include graduation rate goals,
increased admission standards, elimination of academic programs that have low student
completion rates, increased research productivity and technology, phasing out remedial
education course offerings, demonstrating progress in placing students in jobs, increasing
nonresident tuition amounts, and designating centers of excellence.
Annual review and revocation. Provides that the initial performance agreement and each
subsequent agreement shall be a six-year agreement and shall be reviewed annually by the
Board of Regents. Authorizes the board to revoke an agreement at any time if it determines
that an institution has failed to abide by the terms of the agreement.
Autonomies granted. Provides that each institution that enters into an agreement shall be
granted specified autonomies and flexibilities including increasing tuition and fee amounts
without legislative approval, carrying forward unexpended and unobligated funds,
procurement of information technology products and services, and state travel regulations.
Provides that the Board of Regents, in collaboration with the division of administration, shall
identify additional operational autonomies, including but not limited to procurement and
construction, to be granted to an institution during the initial agreement period if certain
conditions are met as specified in proposed law. SB NO. 570
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Monitoring, reporting, and renewal. Provides that the Board of Regents annually shall
monitor and report to the legislature and the governor on each participating institution's
progress in meeting the performance objectives. Provides for a determination by the board
as to whether to renew an institution's performance agreement based on the
recommendations of a review panel established by the board to be composed of the same
membership as the Postsecondary Education Review Commission ( present law,
R.S. 17:3238). Specifies further objectives to be met by an institution if its agreement is
renewed including further increasing cohort graduation rate goals.
Present law, relative to the use of surplus funds by public postsecondary education
institutions, allows such institutions to retain any state general funds appropriated or
allocated which remain unexpended and unobligated at the end of the fiscal year, provided
that not less than 50% of such retained funds be maintained in a preventative maintenance
reserve fund. Provides that such monies shall be used solely for preventative maintenance
purposes and shall only be spent on nonrecurring projects. Prohibits an institution from
carrying forward more than 2% of its prior fiscal year's state general fund appropriation or
allocation.
Proposed law retains present law but exempts institutions entering into a performance
agreement pursuant to proposed law from the requirement that at least 50% of retained funds
to be maintained in a reserve fund and used only for preventative maintenance purposes and
the prohibition on more than 2% of certain state general fund appropriations or allocations
being carried forward.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Amends R.S. 17:3386(A) and (D); adds R.S. 17:3139 and 3386(E))