1. Patrick Kelly National Center for Higher Education Management Systems Presentation to the Louisiana Postsecondary Education Review Commission September 29, 2009 Productivity and the Impact of Shifting Enrollments and Resources

2. Different Approaches to Analyzing Productivity State and Local Appropriations Tuition and Fees Endowment Income Government Grants and Contracts Private Gifts, Grants and Contracts Other E&G Revenue Instruction Student Services Academic Support Institutional Support Plant Operation and Maintenance Research Public Service Scholarships and Fellowships Programmatic Costs Student/Faculty Ratios Faculty Workload Faculty and Staff Attrition Administrative Staffing Patterns Academic Program Mix Course Delivery Modes Space Utilization Public Investment vs. Performance Institutional Spending vs. Performance Cost Savings and Efficiency General Revenues General ExpendituresInternal Operations Degree Production Retention and Graduation Rates External Research Outcomes and Performance 2

3. Different Approaches to Analyzing Productivity State and Local Appropriations Tuition and Fees Endowment Income Government Grants and Contracts Private Gifts, Grants and Contracts Other E&G Revenue Instruction Student Services Academic Support Institutional Support Plant Operation and Maintenance Research Public Service Scholarships and Fellowships Programmatic Costs Student/Faculty Ratios Faculty Workload Faculty and Staff Attrition Administrative Staffing Patterns Academic Program Mix Course Delivery Modes Space Utilization Public Investment vs. Performance Institutional Spending vs. Performance Cost Savings and Efficiency General Revenues General ExpendituresInternal Operations Degree Production Retention and Graduation Rates External Research Outcomes and Performance NCHEMS Approach Total Unrestricted Revenues 3

4. Different Approaches to Analyzing Productivity State and Local Appropriations Tuition and Fees Endowment Income Government Grants and Contracts Private Gifts, Grants and Contracts Other E&G Revenue Instruction Student Services Academic Support Institutional Support Plant Operation and Maintenance Research Public Service Scholarships and Fellowships Programmatic Costs Student/Faculty Ratios Faculty Workload Faculty and Staff Attrition Administrative Staffing Patterns Academic Program Mix Course Delivery Modes Space Utilization Public Investment vs. Performance Institutional Spending vs. Performance Cost Savings and Efficiency General Revenues General ExpendituresInternal Operations Degree Production Retention and Graduation Rates External Research Outcomes and Performance Delta Approach Education Related Expenses 4

5. Different Approaches to Analyzing Productivity State and Local Appropriations Tuition and Fees Endowment Income Government Grants and Contracts Private Gifts, Grants and Contracts Other E&G Revenue Instruction Student Services Academic Support Institutional Support Plant Operation and Maintenance Research Public Service Scholarships and Fellowships Programmatic Costs Student/Faculty Ratios Faculty Workload Faculty and Staff Attrition Administrative Staffing Patterns Academic Program Mix Course Delivery Modes Space Utilization Public Investment vs. Performance Institutional Spending vs. Performance Cost Savings and Efficiency General Revenues General ExpendituresInternal Operations Degree Production Retention and Graduation Rates External Research Outcomes and Performance 5

6. A New Look at the Institutional Component of Higher Education Finance: A Guide for Evaluating Performance Relative to Financial Resources (2005) The Dreaded “P” Work: An Examination of Productivity in Public Postsecondary Education (2009) NCHEMS Reports on Higher Education Productivity Available at www.nchems.orgwww.nchems.org 6

7. The Dreaded “P’ Word: An Examination of Productivity in Public Postsecondary Education 7

8. Internal Public Investment from State and Students Postsecondary Education Institutions Costs of Producing Degrees Production of Degrees – and Value to Students and the State Policy Focus External Focus of this Report 8

9. Calculating Public Higher Education Productivity (Using Alabama as an Example) Total State and Local Appropriations and Tuition Revenues for Public Higher Education = $2,394,572,347 Total Funding = Annual Degrees and Certificates Awarded in Public Colleges and Universities (Weighted for Market Value) = 42,548 Certificates and Degrees Awarded = Productivity Total Funding per Certificate and Degree Produced = $56,280 = 1. 3. 2. Degrees Weighted by Value to the State and Individuals: Median Earnings in the State Employment Market Note: STEM includes credentials awarded in computer science and technology, architecture and engineering, mathematics and statistics, and biological and life sciences. * * “Some college, but no degree” was used as a proxy for median earnings of certificate degree-holders. 9

10. Total Funding per FTE Student (2007-08) Source: SHEEO State Higher Education Finance Survey 2008 10

11. Total Funding per FTE Student by State and Student Share (2007-08) Source: SHEEO State Higher Education Finance Survey 2008 Tuition and Fees State and Local 11

12. Annual FTE Enrollment by Public Sector (2006-07) Source: NCES, IPEDS Fall Enrollment Survey 12

13. Degrees and Certificates Awarded* per 100 FTE Students (2006-07) * Adjusted for value of degrees in the state employment market (median earnings by degree type and level) Sources: SHEEO State Higher Education Finance Survey 2008; NCES, IPEDS Completions Survey; U.S. Census Bureau, American Community Survey (Public Use Microdata Samples) 13

14. Degrees and Certificates Awarded* by Level (2006-07) * Adjusted for value of degrees in the state employment market (median earnings by degree type and level) Sources: NCES, IPEDS Completions Survey; U.S. Census Bureau, American Community Survey (Public Use Microdata Samples) 14

15. Percentage of Degrees and Certificates Awarded in STEM Fields (2006-07) Sources: NCES, IPEDS Completions Survey 15

16. Productivity: Degrees Awarded per FTE vs. Total Funding per FTE AL AK AZ AR CA CO CT DE FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY US 14 17 20 23 26 29 32 5,0008,00011,00014,00017,00020,000 Low Resources, High Production Low Resources, Low Production High Resources, High Production High Resources, Low Production Performance: Degrees Awarded per 100 FTE Resources: Total Funding per FTE 16

17. Productivity: Total Funding per Degree* * Adjusted for value of degrees in the state employment market (median earnings by degree type and level) Tuition and Fees State and Local Sources: SHEEO State Higher Education Finance Survey 2008; NCES, IPEDS Completions Survey; U.S. Census Bureau, American Community Survey (Public Use Microdata Samples) 17

18. Annual Certificates and Degrees Awarded by Control/Sector (2006-07) Source: NCES, IPEDS Copmpletions Survey 18

19. Productivity vs. Educational Attainment of the Adult Population Percent of Adults (25 to 64) with Associate Degrees or Higher (2006) Productivity: Total Funding per Degree (2006-07) Sources: SHEEO State Higher Education Finance Survey 2008; NCES, IPEDS Completions Survey; U.S. Census Bureau, American Community Survey (Public Use Microdata Samples) AL AK AZ AR CA CO CT DE FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY US 20 27 34 41 48 55 25,00035,00045,00055,00065,00075,00085,00095,000 High Productivity, Low AttainmentLow Productivity, Low Attainment High Productivity, High AttainmentLow Productivity, High Attainment 19

20. Productivity: Total Funding per Degree (Two-Year Institutions) * Adjusted for value of degrees in the state employment market (median earnings by degree level) Source: Louisiana Board of Regents 20

21. Productivity: Total Funding per Degree (Four-Year Institutions) * Adjusted for value of degrees in the state employment market (median earnings by degree level) Source: Louisiana Board of Regents 21

22. The Impact of Shifting Enrollment and Resources 22

23. Louisiana = 56.5 Sources: Louisiana Board of Regents. Louisiana Dept. of Education. Note: High school graduates not available for 2008. High school graduates for Orleans Parish for 2007 only (2006 affected by hurricane). Public 4Yr Public 2Yr, CC LTC Louisiana Public Sector – First-Time Undergraduates Directly Out of High School as a Percent of High School Graduates, 2006-08 Annual Average 23

24. Louisiana = 42.1 Sources: Louisiana Board of Regents. Louisiana Dept. of Education. Note: High school graduates not available for 2008. High school graduates for Orleans Parish for 2007 only (2006 affected by hurricane). Louisiana Public 4-Year Sector – First-Time Undergraduates Directly Out of High School as a Percent of High School Graduates, 2006-08 Annual Average 24

25. Louisiana = 12.1 Sources: Louisiana Board of Regents. Louisiana Dept. of Education. Note: High school graduates not available for 2008. High school graduates for Orleans Parish for 2007 only (2006 affected by hurricane). Louisiana Public 2-Year/CC Sector – First-Time Undergraduates Directly Out of High School as a Percent of High School Graduates, 2006-08 Annual Average 25

26. Louisiana = 2.3 Sources: Louisiana Board of Regents. Louisiana Dept. of Education. Note: High school graduates not available for 2008. High school graduates for Orleans Parish for 2007 only (2006 affected by hurricane). Louisiana Technical College Sector – First-Time Undergraduates Directly Out of High School as a Percent of High School Graduates, 2006-08 Annual Average 26

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31. What Some States are Doing to Address Cost Efficiency an Productivity Funding Completions – OK, OH, IN, TN, and TX Re-Designing Coursework – Particularly Remedial Education (TN, MS) Major Structural Delivery Changes– AZ, LA Establish Effectiveness and Efficiency Commissions – OH, MD Reaching Out to Adults with College Credit – KY, TN, NM, CO, IN, and OK Stackable Certificates – OH, OR, KY 31

32. Ohio and Maryland Ohio’s Effectiveness and Efficiency Commission – Identified five major areas of focus for cost savings – healthcare, IT-education, energy, procurement, and academic – Workgroup in place to work with institutions on best practices and establishing metrics to track progress in the five areas Maryland’s Strategies – Recognition that higher education system is growing faster than the state budget – Agreed to pay for three-quarters of the growth and institutions pay for one-quarter through cost-saving – Mandated that each institution increase student credit hours per FTE faculty by 10 percent 32

33. Patrick Kelly NCHEMS patrick@nchems.org 33