1. Overview of Performance Funding Model for Ohio’s Community Colleges
2014 University System of Ohio
Trustees Conference
November 18, 2014

2. Ohio Higher Education Funding FY 2015 State Share of Instruction (SSI)
Universities
(14 main campuses plus branches)
$1.4 billion
Community Colleges
(23 campuses)
$419 million
Total
$1.8 billion

3. Performance Funding Major Milestones
Sept. 2012
Governor Kasich’s call to recast Ohio’s funding formula for higher education to reward student success and completion
Nov. 2012
Ohio Higher Education Commission Funding Recommendations
June 2013
House Bill 59 Adopted (FY 2014 – FY 2015 Biennial Budget)
V1 of PBF Model for FY 2014
Dec. 2013
OACC SSI Allocation Recommendations
Transition to 100% PBF model for FY 2015
May 2014
Mid-Biennium Budget Review (MBR) Adopted
V2 of PBF Model for FY 2015
June 2015?
Adoption of FY 2016 – FY 2017 Biennial Budget
V3 of PBF Model

4. Performance (Outcomes-Based) Funding Models
Align state investment with state priorities
Completion/
Attainment
Jobs/Economic Development
Drive institutional behavior
Campus resource allocation
Programmatic evaluation and change
Alternative delivery models
Student Success Agenda & Best Practices

5. Ohio SSI Community College Formula History, 2009-2015FY
Primarily enrollment-based with inclusion of success points (5% to 10%)
Stop Loss (99%-96%)
FY 2014
50% enrollment + 25% course completion + 25% success points
97% stop loss
FY 2015
Elimination of enrollment component Combination of course completion (50%), success points (25%) & completion metrics (25%) At-risk or access category application
No stop loss

6. Success & Completion Measures
Background
Higher Education Funding Commission report and House Bill 59 charges:
At-Risk Factors
…identify the socio-economic, demographic, academic, personal, and other factors that identify a student as being "at-risk" of academic failure….
study the most appropriate formula weights to: “reward schools that are successful in educating non-traditional and at- risk student populations”
Success & Completion Measures
…research the most appropriate success points and completion measures that occur during the academic career of community college students…
Determine how funding shall be distributed among its success points, completion measures and course completion funding…
Requirement to develop institutional completion plans

7. OACC Community College Funding Consultation Process
Began meeting in March 2013
Majority of institutions represented
Included representatives from the Ohio Board of Regents, the Higher Education Funding Commission and the Ohio Office of Budget and Management
Facilitated by the OACC and HCM Strategists
Consultation from HCM provided through Lumina Strategy Labs
Working group formed in August 2013
Developed formula framework & technical details
Recommendations presented to full consultation
Engagement of OACC Presidents
Presentation and discussion each month from September to December 2013

8. FY 2015 Proposed Model: Guiding Principles
Multiple models were reviewed and evaluated based on data, policy implications, and the consultation’s guiding principles:
Hold true to the mission and priorities of community colleges including access, completion, quality, and workforce development
Incentivize institutions to adopt evidence-based practices to help them succeed
Include metrics grounded in student success research and best practices
Align with state priorities and initiatives
Be simple to understand and communicate
Develop a model that is sustainable, consistent, and reliable

9. FY 2015 Framework Summary *Access Categories Applied
Adult (age 25 and over at time of enrollment)
Low-Income, Pell Eligible (ever in college career)
Minority (African American, Hispanic, Native American)
All data averaged over three years

10. Component 1: Course Completion (50%)
Cost-Based Calculation
Average statewide cost based on level of course and subject area (aggregation of CIP codes)
# of FTE who pass course * determined cost
Access category weight:
15% for any student with one (or more) risk factors

11. Component 2: Success Points (25%)
Developmental Education Success
# of Students completing developmental education Math and enrolling in first college-level math course (1 point)
# of Students completing developmental education English & enrolling in first college-level English course (1 point)
12 Credit Hours
# of students earning first 12 college-level credits (1 point)
24 Credit Hours
# of students earning first 24 college-level credits (1 point)
36 Credit Hours
# of students earning first 36 college-level credits (1 point)

12. Component 3: Completion Milestones (25%)
Associate Degree Completions
Certificate Completions
Transfer w/12+ credit hours
Cost-Based Model
Access Category Weights:
25% for one access category
66% for two access categories
150% for three access categories

13. Access Categories for Weighting Course Completions and Completion Milestones
FY 15 Access Categories: Adult - 25 and older at enrollment Low-income - Pell-eligible (ever) Minority: American Indian, Hispanic, African American
Policy: Focus on student background, not enrollment status (e.g. part-time, enrollment in developmental education courses)
Narrow-In: Correlation between factors & policy informed recommended final categories
Significance: How much less likely are students from these groups to complete/graduate compared to students not from group
Data run to determine significance related to graduation and course completion
Aligned with Data or Potential Proxies (9 in total)
Colleges submitted suggested populations (15 distinct categories)

14. Review of Distribution Method
A proportional distribution model for each component is utilized, consistent with prior methods. Institutions receive a proportional share of the total earned across each component.
Course Completion (Entry) (% of (total cost-based Completed FTE Earned + % of total completed FTE Access Add-on Earned) * 50% of FY 2015 Allocation)
Success Points (Progression/Momentum) (% share success points earned * 25% FY 2015 Allocation)
Completion Milestones (COMPLETION) (% of total cost-based completion milestones earned + % of total completion milestones access add-on earned) *25% of FY 2015 Allocation)

15. Fiscal Year Formula

16. Process for FY
Work group began meeting again in March 2014 and followed the same process with regular updates to the full consultation and OACC Presidents.
A guiding principle of the work for the FY 2016 framework development was to maintain as much consistency as possible from the FY 2015 funding model and support institutions in understanding the formula and evaluating the outcomes.
The OACC has engaged HCM Strategists for ongoing facilitation support as well as institutional data analysis.

17. Recommendations for FY 2016-17
Data
SSI models have traditionally used projected data for distributions of first-half fiscal year allocations. With inclusion of additional metrics and measures like access populations, projections become more difficult and could result in inaccurate modeling and estimates.  
Course completions: The model will continue to use most recent three-year average for course completions. This variable relates most directly to enrollment volume, which has direct current cost implications for institutions.
Success Points & Completion Milestones: The model will use an additional year lagged three-year average for success points and completion milestones.
Projection & Reporting Guidelines: The OACC will work to provide institutions with guidelines and considerations for developing projections for course completions.

18. Recommendations for FY 2016-17, continued
Add Academic Preparation Access Category
Establish HEI reporting process for placement scores
Align to Ohio Remediation Free Standards
Short-term certificates and certificates of value
Continue to establish common definitions and data collection processes for short-term certificates (less than 1-year)
Seek alternative funding stream

19. Next Steps: Evaluate & Refine
Additional Policy Issues: Evaluate existing model to understand relation to additional policy priorities and goals. Such as:
Course equivalents/Prior Learning Assessment
Dual Enrollment
Job placement/workforce training
Adjusted allocation across components
Continuous Improvement & Best Practices
Support institutions in the evaluation of student outcomes
Identify and share best practices for student success
Evaluate and refine the formula to ensure fairness and alignment with statewide priorities and goals

20. Thank You!