University funding could soon be performance-based

Changes in how Arizona universities are funded could be made by fiscal year 2013, according to a representative from the Arizona Board of Regents.

Katie Paquet, the associate vice president for public affairs and external relations for ABOR, said that under a new initiative that is being pushed by the state, universities might see a move toward performance-based funding.

Currently, state universities are funded based on the number of students who are enrolled at each university.

Paquet said that the new funding model would be a “base plus performance” funding model, where universities would receive the same base funding as they do currently, and earn more funding based on achieving specified goals, such as higher graduation rates.

The proposed funding model, which was released by ABOR in mid-July, is an answer to a requirement from the Arizona State Legislature to have a proposal that would attach state funding to university performance.

The model was put together by the Higher Education Finance Committee of a project called Getting AHEAD, which is an Arizona initiative designed to help more residents obtain a college degree. The finance committee is made up of representatives from Arizona colleges and universities, as well as from the state Legislature.

Performance would be evaluated based on students’ graduation rates, completed student credit hours, and number of research endeavors and grants.

ASU President Michael Crow spoke about the current funding model for universities in an interview with The State Press Editorial Board in March.

“It’s a dated model and it’s an enrollment-based model,” he said. “We think that the universities should be invested in based on performance, on output, rather than based on input … we think the universities should be paid for how many graduates they produce.”

Currently, 58 percent of students at Arizona’s universities graduate within six years.

Paquet said the proposed funding model could serve as an initiative for Arizona universities to work harder to achieve set goals such as a higher graduation rate.

“The model, as it stands right now, speaks volumes about how bold the plan is,” she said. “It’s an expression in the confidence in our ability to meet these goals.”

The Board of Regents is finalizing a performance-based funding plan that will need to be completed and sent to the Legislature by an Oct. 1 deadline.

If the Legislature and the governor approve the new model, it could go into effect as early as the 2012-2013 school year.

Reach the reporter at katherine.torres@asu.edu