Appel (SB 337) Act No. 462
New law provides for the creation and implementation of an outcomes-based funding
formula for postsecondary education as follows:
(1)Requires the commissioner of higher education and the presidents of each
postsecondary education system to:
(a)Review the postsecondary education funding formula and develop a
comprehensive outcomes-based funding formula that ensures the equitable
allocation of state funds to public postsecondary educational institutions,
appropriately considers costs, places significant emphasis on student and
institutional outcomes, and aligns with the state's economic development and
workforce needs.
(b)Consult with and solicit meaningful feedback and guidance from institutional
presidents, chancellors, faculty, chief academic officers, chief financial
officers, students, and business and civic leaders.
(c)Make recommendations for any changes needed in the Master Plan for
Postsecondary Education and the Louisiana Granting Resources and
Autonomy for Diplomas Act as provided in R.S. 17:3139, et seq., to support
and facilitate implementation of the outcomes-based funding formula.
(d)Focus upon developing the optimal methodology by which to allocate
postsecondary funding in a manner that provides incentives for institutions
to achieve desired outcomes.
(2)Requires that the following factors be considered and included in the formula as
deemed appropriate.
(a)Student success factors, including retention, timely progression toward degree
completion, cost of completion, certificate and degree production, and
successful transfer of students from community and technical colleges to
four-year degree-granting institutions.
(b)Alignment with economic development and workforce needs, including
certificate and degree production in science, technology, engineering,
mathematics, and other high-demand fields and the potential earning power
of graduates.
(c)Research and innovation, including research expenditures, technology
transfer, and commercialization.
(d)Funding, including credit hour costs and cost of certificate and degree
completion.
(e)Any other factor or metric that would promote desired student and
institutional outcomes.
(3)Requires the outcomes-based formula to:
(a)Appropriately consider the role, scope, and mission of each postsecondary
institution.
(b)Establish a concise set of outcomes to be measured for each postsecondary
institution and define metrics for each outcome that are reliable, accurate,
nationally recognized, and benchmark the performance of each institution
compared to its statistical peers from other states, wherever valid comparable
data is available.
(c)Determine the optimal allocation of state appropriated funds to each
postsecondary institution based upon operational costs, performance
outcomes, and performance-based, targeted incentives. However, the amount to be allocated based upon performance outcomes must be sufficient to
incentivize increased performance at the campus level.
(d)Consider the characteristics unique to each individual postsecondary
institution, including community and technical colleges and professional
schools, such as student enrollment characteristics and geographic location
and delivery area.
(e)Include safeguards to prevent sudden, dramatic changes in the funding level
of any postsecondary institution.
(f)Contain a timeline for full formula implementation.
(4)Requires that formula implementation shall begin as soon as practicable, but not later
than the beginning of the 2016-2017 fiscal year.
(5)Requires the commissioner of higher education, not later than December 31, 2015,
to submit a written report containing the proposed outcomes-based funding formula
and related recommendations for related policy and statutory changes to the Board
of Regents for its consideration and approval.
(6)Requires the Board of Regents to review the report and subsequently submit the
report, the proposed outcomes-based funding formula, and the board's comments and
recommendations to the Senate Committee on Education, the Senate Committee on
Finance, the House Committee on Education, and the House Committee on
Appropriations, not later than January 31, 2016.
(7)Requires the commissioner of higher education and the postsecondary system
presidents to collectively re-evaluate the postsecondary education funding formula
at least once every two years and submit a written report regarding the formula's
effectiveness and the performance of each postsecondary institution to the Senate
Committee on Education, the Senate Committee on Finance, the House Committee
on Education, and the House Committee on Appropriations.
Effective upon signature of the governor (June 4, 2014).
(Adds R.S. 17:3129.2)