PERFORMANCE INDICATORS REVIEW TASK FORCE REVIEW OF MICHIGAN COMMUNITY COLLEGE ASSOCIATION PROPOSAL

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1 Intrductin PERFORMANCE INDICATORS REVIEW TASK FORCE REVIEW OF MICHIGAN COMMUNITY COLLEGE ASSOCIATION PROPOSAL The fllwing infrmatin prvides a cmparisn between the current cmmunity cllege funding frmula and the prpsed new Michigan Cmmunity Cllege Assciatin (MCCA) perfrmance funding mdel. The gal fr develping the prpsed mdel is the same as the gal fr the 2006 mdel; determining the mst apprpriate and reliable perfrmance indicatrs and the mst efficient methdlgy fr cnnecting State apprpriatins t thse indicatrs. It is imprtant t nte that perfrmance funding allcatins have been applied nly t funding increases and have nt been used t redistribute State aid fr cmmunity cllege peratins. Maintaining the base prvides stability t enable clleges t effectively develp annual budgets. Current Perfrmance Indicatrs Task Frce Funding Mdel. The current funding mdel includes an allcatin f 50.0% f annual funding increases based n an acrss-the-bard basis t prvide fr system sustainability and t restre funds reduced frm cllege peratins during perids f State revenue shrtfalls. The remaining funds are allcated based n three categrical indicatrs: Enrllment and Business Efficiency, Cmpletins, and Lcal Strategic Value. Metrics currently used pursuant t Sectin 230 f Public Act 85: Prprtinate t Previus Fiscal Year Base Apprpriatins/System Sustainability, 50.0%. The Perfrmance Indicatrs Task Frce funding mdel included as a pririty the restratin f funding subject t budget cuts since FY Therefre, the frmula mdel prvided that 50.0% f annual funding increases shuld be allcated in an "acrss-the-bard" manner. There have been n adjustments t this part f the frmula since its inceptin. Cntact Hur Equated Students, 10.0%. This categry riginally received 17.5% f the frmula allcatins. Allcatins are based n the number f student cntact hurs as measured by a tw-year average as reprted in the Activities Classificatin Structure (ACS) 1. In FY , the allcatin was reduced frm 17.5% t 10.0%, with the difference being allcated t the administrative csts prtin f the frmula. Administrative Csts, 7.5%. This allcatin is based n a tw-year average f administrative csts represented as a percentage f General Fund perating csts, as reprted in the ACS. The tw-year average administrative cst percentage is subtracted frm a ceiling percentage each year (24.0% in FY ). Clleges with larger differences frm the ceiling amunt receive a prprtinately larger amunt f funding relative t ther cmmunity clleges, thus rewarding clleges with lwer percentages f administrative csts. Beginning in FY , the administrative cst metric has been funded thrugh the reductin in the Cntact Hur Equated Students metric frm 17.5% t 10.0%. Weighted Degree/Certificatin Cmpletin Frmula, 17.5%. Data fr this metric are btained thrugh the Integrated Pstsecndary Educatin Data System (IPEDS). 2 Data are based n a tw-year average. The fllwing weights are applied t cmpletins: 1 The ACS was created in respnse t Sectin 8 f Public Act 419 f 1978 fr the purpse f dcumenting financial needs f cmmunity clleges. The ACS defines Cntact Hur Equated Students as the calculated equivalent f a student having cmpleted ne full year f instructin (31 credit hurs multiplied by 16 cntact hurs = 496 cntact hurs f instructin). 2 IPEDS is the pstsecndary educatin data cllectin prgram fr the Natinal Center fr Educatin Statistics, a part f the Institute fr Educatin Sciences within the United States Department f Educatin. 1

2 Weight General and Business 1 Natural Science 2 Engineering/Technlgy 4 Health 4 Lcal Strategic Value, 15.0%. Clleges are required t meet fur ut f five best practices listed in each f the fllwing categries: Categry A: Ecnmic Develpment and Business r Industry Partnerships (i) The cmmunity cllege has active partnerships with lcal emplyers including hspitals and health care prviders. (ii) The cmmunity cllege prvides custmized n-site training fr area cmpanies, emplyees, r bth. (iii) The cmmunity cllege supprts entrepreneurship thrugh a small business assistance center r ther training r cnsulting activities targeted tward small businesses. (iv) The cmmunity cllege supprts technlgical advancement thrugh industry partnerships, incubatin activities, r peratin f a Michigan technical educatin center r ther advanced technlgy center. (v) The cmmunity cllege has active partnerships with lcal r reginal wrkfrce and ecnmic develpment agencies. Categry B: Educatinal Partnerships (i) The cmmunity cllege has active partnerships with reginal high schls, intermediate schl districts, and career-tech centers t prvide instructin thrugh dual enrllment, cncurrent enrllment, direct credit, middle cllege, r academy prgrams. (ii) The cmmunity cllege hsts, spnsrs, r participates in enrichment prgrams fr area K-12 students, such as cllege days, summer r afterschl prgramming, r science Olympiad. (iii) The cmmunity cllege prvides, supprts, r participates in prgramming t prmte successful transitins t cllege fr traditinal age students, including grant prgrams such as talent search, upward bund, r ther activities t prmte cllege readiness in area high schls and cmmunity centers. (iv) The cmmunity cllege prvides, supprts, r participates in prgramming t prmte successful transitins t cllege fr new r reentering adult students, such as adult basic educatin, general educatin develpment certificate preparatin and testing, r recruiting, advising, r rientatin activities specific t adults. (v) The cmmunity cllege has active partnerships with reginal fur-year clleges and universities t prmte successful transfer, such as articulatin, 2+2, r reverse transfer agreements r peratin f a university center. Categry C: Cmmunity Services (i) The cmmunity cllege prvides cntinuing educatin prgramming fr leisure, wellness, persnal enrichment, r prfessinal develpment. (ii) The cmmunity cllege perates r spnsrs pprtunities fr cmmunity members t engage in activities that prmte leisure, wellness, cultural r persnal enrichment such as cmmunity sprts teams, theater r musical ensembles, r artist guilds. 2

3 (iii) The cmmunity cllege perates public facilities t prmte cultural, educatinal, r persnal enrichment fr cmmunity members, such as libraries, cmputer labs, perfrming arts centers, museums, art galleries, r televisin r radi statins. (iv) The cmmunity cllege perates public facilities t prmte leisure r wellness activities fr cmmunity members, including gymnasiums, athletic fields, tennis curts, fitness centers, hiking r biking trails, r natural areas. (v) The cmmunity cllege prmtes, spnsrs, r hsts cmmunity service activities fr students, staff, r cmmunity members. New MCCA Prpsed Funding Mdel The MCCA prpsal includes elements similar t the current frmula, hwever uses different metrics fr perfrmance indicatrs, changes the cntact hur metric by weighting health and technlgy cntact hurs, and changes percentage allcatins t metrics. Base allcatin fr sustainability, 30.0% (decreased frm current 50.0%). A baseline increase fr each cllege that recgnizes nging csts that each cllege incurs fr peratins. Perfrmance/Cmpletins, 30.0%. This cmpnent wuld replace the current weighted degree/cmpletins metric that receives 17.5% f the current frmula. Three distributins f 10.0% each wuld be made under this categry: Perfrmance Imprvement. This cmpnent is based n imprvement in six-year average rates f cmpletin. The data surce is Gvernr's dashbard n cmpletin rates. This metric measures the cllege against itself. The prpsal envisins eventually using three chrts, the MCCA mdel includes tw (2007 and 2008). Clleges with imprved rates receive a share f 20.0% f the funding allcated t this categry. Eighty percent f the amunt allcated t this categry is distributed t all 28 cmmunity clleges prprtinately based n the prir year apprpriatin fr each cllege (acrss-the-bard). Perfrmance Cmpletin Number. This metric rewards clleges fr their prprtinate share f cmpleters relative t statewide cmpletins. Each reprted IPEDS cmpletin cunts as ne (n weighting). Cmpletins include certificates, degrees, and transfers. The measure places an equal value n certificates and degrees because bth having value in labr market. The data surce fr this metric is IPEDS. Perfrmance Cmpletin Rate. This measures a cllege s perfrmance relative t all 28 public cmmunity clleges using tw chrts (2007 and 2008) t smth year t year variances. The metric is based n six-year cmpletin rates. Clleges the farthest abve the average get the largest increase f 20.0% f the funding allcated t this metric. Clleges at r belw the statewide average cmpletin rate get nthing frm the 20.0% prtin f funding allcated t this metric. Hwever all clleges receive a share f 80.0% f the funding allcated t this metric, based n the prir year apprpriatin fr each cllege (acrss-the-bard). Cntact Hur cmpletins, 30.0%. This is an increase frm the current 10.0% allcatin. This metric recgnizes curse enrllment and the new weighting fr health and technlgy prgrams recgnizes higher csts fr thse prgrams. A weighting f 2x is given t health and technlgy prgrams. 3

4 Administrative Efficiency, 5.0%. This is a decrease frm current 7.5% allcatin. The methdlgy fr the distributin remains the same. Clleges with lwer administrative csts (represented as a percent f their perating expenditures) receive a larger prtin f funding frm this categry. Lcal Strategic Value, 5.0%. This is a decrease frm the current 15.0% allcatin. The MCCA des nt list any specific change t the current methdlgy fr distributing funding under this categry. Hwever, the prpsal des refer t wrkfrce placement data being be cnsidered nce available. Table 1 summarizes the difference between the current Perfrmance Indicatrs Task Frce Mdel and the MCCA prpsal. Table 1 Perfrmance Indicatrs Task Frce Current Frmula Cmpared t MCCA Prpsal Metric Current Frmula MCCA Prpsed Frmula System Sustainability/Increase prprtinate t base (acrssthe-bard adjustment) 50.0% 30.0% Cntact Hurs 10.0% Cntact hurs nt weighted. 30.0%. Weighted (cntact hurs in health and technlgy 2x). Perfrmance 17.5% Weighted Degree/ Certificatin Cmpletin. 30.0% Perfrmance. 10.0% Cmpletin Imprvement; 10.0% Number f Cmpletins; 10.0% Cmpletin Rate. Administrative Csts 7.5% 5.0% Lcal Strategic Value 15.0% 5.0% Ttal 100.0% 100.0% Frmula Methdlgy 3 Prprtinate t Base 65.0% 51.0% Metrics 35.0% 49.0% Table 2 shws the funding impact f the prpsed frmula based n a $10.0 millin (3.2%) increase t FY apprpriatins fr cmmunity cllege peratins. Thirteen clleges receive mre funding under the MCCA prpsal, 15 receive less. Hwever, the differences range frm a fivetenths f a percent decrease t an eight-tenths f a percent increase. Fr 20 clleges the change is less than tw-tenths f ne percent. 3 Acrss-the-bard (prprtinate t base) distributins fr the current frmula include: 50.0% System Sustainability and 15.0% Lcal Strategic Value. Acrss-the-bard distributins fr the MCCA prpsal include 30.0% System Sustainability, 16.0% Hld Harmless (prtin f perfrmance funding), and 5.0% Lcal Strategic Value. 4

5 Table 2: MCCA Frmula Prpsal - Cmparisn t Current Frmula Current Frmula % Change t YTD MCCA Frmula % Change t YTD FY Enacted Current Frmula MCCA Prpsal Change Difference Alpena $5,464,400 $171,400 $183,779 $12, % 3.4% 0.2% Bay de Nc 5,490, , ,993-6, % 2.9% -0.1% Delta 14,704, , ,997-12, % 3.2% -0.1% Glen Oaks 2,551,100 81,400 82,406 1, % 3.2% 0.0% Ggebic 4,509, , ,243 19, % 3.4% 0.4% Grand Rapids 18,187, , ,688 41, % 3.3% 0.2% Henry Frd 21,893, , ,410 8, % 2.9% 0.0% Jacksn 12,245, , ,949-23, % 2.8% -0.2% Kalamaz Valley 12,689, , ,605-13, % 3.3% -0.1% Kellgg 9,950, , ,484-5, % 3.1% -0.1% Kirtland 3,221, , ,794-16, % 3.4% -0.5% Lake Michigan 5,417, , ,856-3, % 3.2% -0.1% Lansing 31,288, , ,562-65, % 2.8% -0.2% Macmb 33,239, ,600 1,006,670 24, % 3.0% 0.1% Mid-Michigan 4,757, , ,000-2, % 3.7% 0.0% Mnre Cunty 4,565, , ,082-7, % 3.6% -0.2% Mntcalm 3,280, , ,827 17, % 4.4% 0.5% Mtt 15,901, , ,670-13, % 3.1% -0.1% Muskegn 9,020, , ,163 16, % 3.3% 0.2% Nrth Central 3,224, , ,827 26, % 4.6% 0.8% Nrthwestern 9,200, , ,253-14, % 2.9% -0.2% Oakland 21,429, , ,846 64, % 3.6% 0.3% St. Clair 7,158, , ,475 44, % 3.8% 0.6% Schlcraft 12,706, , ,948-59, % 3.1% -0.5% Sutwestern 6,657, , ,303 12, % 3.0% 0.2% Washtenaw 13,301, , ,074 8, % 4.0% 0.1% Wayne Cunty 16,989, , ,266-54, % 3.3% -0.3% West Shre 2,446,200 72,700 71, % 2.9% 0.0% Ttal $311,492,000 $10,000,000 $10,000,000 $0 3.2% 3.2% 0.0%