Tennessee Higher Education Commission Higher Education Recommendations & Finance Overview November 15, 2012
Tennessee Higher Education Commission Finance Background Data 2
3 Tennessee Higher Education Commission TN Outcomes-Based Formula 3
4 Tennessee Higher Education Commission TN Outcomes-Based Formula 4
5 Tennessee Higher Education Commission TN Outcomes-Based Formula 5
6 Tennessee Higher Education Commission TN Outcomes-Based Formula 6
7 Tennessee Higher Education Commission TN Outcomes-Based Formula 7
8 Tennessee Higher Education Commission TN Outcomes-Based Formula 8
Tennessee Higher Education Commission Overview of Phase-In Period 9
10 Tennessee Higher Education Commission TN Outcomes-Based Formula Hold Harmless Policy Phase-out Begins 10
11 Tennessee Higher Education Commission Cumulative Change in Appropriations at Universities Due to the Formula 11
12 Tennessee Higher Education Commission Cumulative Change in Appropriations at Community Colleges Due to the Formula 12
13 Tennessee Higher Education Commission TN Outcomes-Based Formula 13
14 Tennessee Higher Education Commission TN Outcomes-Based Formula 14
Tennessee Higher Education Commission Financial Aid Background Data 15
Tennessee Higher Education Commission Federal governments Free Application for Federal Student Aid, or FAFSA. Expected Family Contribution (EFC). A proxy for a students ability to pay for college. Basis for awarding need-based financial aid such as the Federal Pell grant and the Tennessee Student Assistance Award (TSAA). Student Income Profile 16
Tennessee Higher Education Commission Student Income Profile Of the 120,000 students who filed a FAFSA in 2007, 52 percent were Pell eligible. 17
Tennessee Higher Education Commission Student Income Profile Of the 164,000 students who filed a FAFSA in 2011, 62 percent were Pell eligible. 18
19 Tennessee Higher Education Commission Student Income Profile Of all community college students who filed a FAFSA in 2011… 74 percent were Pell/TSAA eligible. 84 percent of adults students were Pell/TSAA eligible. 52 percent had a zero EFC. From 2007 to 2011, the proportion of students who had an EFC of zero increased from 34% to 52%. Northeast CC had the highest FAFSA completion rate at 76%. 19
20 Tennessee Higher Education Commission Student Income Profile Of all university students who filed a FAFSA in 2011… 53 percent were Pell/TSAA eligible. 32 percent had a zero EFC. From 2007 to 2011, the proportion of students who had an EFC of zero increased from 20% to 32%. Tennessee Tech had the highest FAFSA completion rate at 85%. 20
Tennessee Higher Education Commission Student Financial Aid Sources: THEC, TSAC, US Dept. Education Out of 247,000 students in public higher education, over 121,000 received a Pell grant and more than 87,000 benefited from the lottery program. 21
Tennessee Higher Education Commission Student Financial Aid Sources: THEC, TSAC, US Dept. Education In public higher education collected over $1.1 billion in gross tuition revenue, which was offset by $730 million in federal and state grants. 22
Tennessee Higher Education Commission Average debt for a TN university graduate (public and private) was $20,700 in This was the 6 th lowest debt level in the nation. In 2005, TN had the 34 th lowest debt level. 53 percent of TN graduates had debt, the 11 th lowest percentage in the nation. Student Debt 23
Tennessee Higher Education Commission Student Debt Analysis Source: Project on Student Debt Database 24
Tennessee Higher Education Commission Student Debt Analysis 25
Tennessee Higher Education Commission Student Debt Analysis 26
Tennessee Higher Education Commission Low Student Debt Factors Emergence of lottery scholarship. Protection of TSAA from budget cuts. Institutional and TSAC default prevention programs. Elevation of financial literacy programs. 27
Tennessee Higher Education Commission Recommendations Summary 28
Tennessee Higher Education Commission Overview is the 3 rd and final year of the phase-in period. Outcomes model is fully phased in and the Hold Harmless provision is fully phased out. 29
Tennessee Higher Education Commission Overview Outcome data has undergone significant improvement over last two years. Annual meetings of Data Quality Roundtable; Formula Data Committee; Auditors meeting. Intensive efforts since summer 2012 to align UT, TBR, THEC data. 30
Tennessee Higher Education Commission Productivity Changes 31
Tennessee Higher Education Commission Productivity Changes 32
Tennessee Higher Education Commission Productivity Changes 33
Tennessee Higher Education Commission Productivity Changes 34
Tennessee Higher Education Commission Recommendation Summary - Operating 35
Tennessee Higher Education Commission State Appropriation Recommendations $35.5M to fund outcome growth. $14M for Non-formula units. 33.6M for TSAA financial aid. 36
Tennessee Higher Education Commission Outcomes Formula Analysis East Tennessee State University Component Impact on State Appropriations 37
Tennessee Higher Education Commission State Appropriation Recommendations $15.7 for TTC/CC Equipment Replenishment. $1M for Higher Education Innovation Fund. 38
Tennessee Higher Education Commission Recommendation Summary - Tuition 39
Tennessee Higher Education Commission Tuition Recommendations Affordability and financial aid; Student income profile; Institutional revenues and cost inflation. 40
Tennessee Higher Education Commission Tuition Comparisons 41
Tennessee Higher Education Commission THEC Tuition Model as a guide. Revenue projections based on inflation, enrollment changes. Tuition Recommendations 42
Tennessee Higher Education Commission Assuming $35.5M in new state funding; Assuming 3% inflation and no enrollment growth, tuition would need to increase by: University average = 2.5%; Community colleges = 1.4%. Tuition Recommendations 43
Tennessee Higher Education Commission Tuition Recommendations Up to 6 Percent at Universities Up to 3 Percent at TTCs & Community Colleges 44
Tennessee Higher Education Commission Recommendation Summary - Capital 45
Tennessee Higher Education Commission Capital Projects Continuation of 5 year plan. Institutional match component. Full project planning funded out of institutional match. Alignment with CCTA. 46
Tennessee Higher Education Commission Capital Projects $289M for seven capital outlay projects. $104M for 69 capital maintenance projects. 47
Tennessee Higher Education Commission Higher Education Recommendations & Finance Overview November 15,