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In Texas, the state legislature and Gov. Rick Perry were asked to follow funding formula that is outcome based. The Texas Higher Education Coordinating Board wants them to do this for its public universities as well as community colleges next year. There was some reaction from the state’s faculty groups who feel that the quality of education could be affected by the proposed changes.

Today, many states have adopted funding formulas that do not work on student enrolment. Rather, student completion is taken as a funding guideline. This transition has been spurred on by our President’s 2020 goal of enhancing the number of college graduates.

However compared to other states that implemented the performance based funding formula to constitute only around five to ten percent, Texas plan will make a major impact and will certainly encourage competition.

A set of recommendations were released regarding the funding model for the technical colleges, community colleges and state universities by the Texas board. Ninety percent of the undergraduate funding will be enrolment based including the professional and graduate student funding and the balance ten percent funding will be based on bachelor’s degree awarded at the institutions.

The significant difference in the proposed formula for technical and community colleges is that most two year institutions will severely be affected by the four year institution allocation methods.
According to the Texas commissioner Raymund Paredes, performance based funding practice was analyzed by the board which determined that a ten percent allocation would make a significant difference even as it would not be too hard on the institutions.

He said that this change in state funding formula will not put the public institutions’ stability and fiscal predictability at risk. The faculty association expressed deep concerns though as they feel that more money will end up being allocated to the elite institutions and colleges that educated low income family students will be a great disadvantage.

According to the executive director of the group Mary Aldridge Dean, this competitive funding program will make a negative impact on poor students. She also opined that there will be a drastic reduction in classroom standards.

The Dean also said that faculty will be under pressure to ensure that all students pass if graduation rates are tied to funding. She said that standards will be lowered drastically if funding was based on completion.

The idea that colleges with more STEM graduates will be rewarded is not at all welcomed by the Dean who argued that this is like telling the institution about a faculty member’s worth.

She stressed on the fact that higher education was not a business and money making venture. It is important to produce well educated and well rounded graduates. Reservations were also expressed by the Texas Community College Teachers Association, another faculty group about the proposed funding formula changes by the board.

It remains to be seen after the program comes into effect how much of an impact this formula is going to have on the higher education system in Texas.