Collaborative commission creates fresh funding formula
Unless Youngstown State University’s graduation rates increase, funding from the state will remain steady or decrease.
On Tuesday, Gov. John Kasich heralded the state’s recently proposed higher education funding formula, which incentivizes boosting graduation rates.
“You think of anything worse, two or three years in a four-year school, huge debt, you quit. You got big debt, got no job, got no certificate. It doesn’t work,” Kasich said.
In September, Kasich appointed E. Gordon Gee, president of Ohio State University, to oversee a committee composed of presidents and representatives from various four-year and two-year institutions throughout the state. Its mission was to devise a new, balanced approach for distributing state funds.
Although no one from YSU sat on the committee, campus administrators were given ample opportunity to provide input from the school’s perspective.
“Having that dialogue and conversation, at the very least, everybody gets to hear everyone else’s circumstances,” said Scott Schulick, a member of the YSU Board of Trustees.
Still, financial officers on campus don’t exude much optimism about the school’s financial future.
“Keep in mind that even in the best of circumstances, the funding from the state, a small percentage of what our income is, has been dropping over the years,” said Gene Grilli, vice president for finance and administration.
In 2001, state funding made up nearly 50 percent of YSU’s annual revenue. Now, the amount is around 25 percent.
“Over time, it’s been a constant reduction in our support from the state. I think everyone expects that to continue,” Grilli said. “I don’t think there’s any question that with the amount of money from the state to higher education is going to diminish.”
Previously, state officials primarily used enrollment numbers to decide how much an institution should receive. Now, 50 percent of state funds will be determined by graduation rates.
At YSU, the six-year graduation rate for students entering as freshmen in 2005 — the most recent year data was available — is 35.2 percent, the fourth lowest in the state system.
OSU boasts the state’s highest rate — an 82 percent graduation rate for its 2006 entering class, meaning students who completed their degrees by fall 2012. Using this data, the Ohio Board of Regents projects that YSU will receive an additional 1.1 percent in State Share of Instruction, or SSI, funding in fiscal year 2014, a $408,743 increase.
“Any positive amount is a good thing, even if it’s a small one,” Schulick said. “It’s not a large amount at all, but, at the same time, it’s not a cut either. Anything that’s not a cut, I see as having a positive impact on YSU.”
Cleveland State University, which has a 30 percent six-year graduation rate, will receive a 5.1 percent increase in SSI — a $3,343,568 boost.
Five of the 13 state universities in Ohio will experience cuts from the state. The University of Akron and the University of Toledo will witness nominal reductions in funding, 0.1 and 0.7 percent, respectively.
Deeper cuts will be made at Shawnee State University, 2.4 percent, and Central State University, 2.1 percent.
The largest reduction in funding will be for Bowling Green State University, which will encounter a 4.2 percent loss in funds, equating to $2,847,652.
Overall, universities and their branch campuses will see a $25,400,000 increase in SSI funding.
“You know, a lot of places in this country, they cut this higher education. We love higher education. It is one of the great assets for the state of Ohio,” Kasich said.
What the governor calls performance-based funding will be implemented for FY 2014, should it pass in the state Legislature. Given the Republican control of both the House and Senate, the proposal, which is included in the biennium budget bill, will likely pass.
“The university presidents signed off on this particular proposal, which signifies to me that this is something that could stay intact,” said state Sen. Joe Schiavoni.
Before deliberations on the legislation begin, Schiavoni plans to meet with YSU President Cynthia Anderson to discuss the intricacies of the proposal.
Within the state Legislature, Republicans hold 23 of the 33 seats in the Senate, and 61 of the 99 seats in the House.
Only FY 2014 projections are available, despite Ohio’s budgeting on a biennial process.
“Per the recommendation of the Commission, several fiscal year 2015 formulaic factors will be studied and finalized during fiscal year 2014,” a fact sheet released by OBOR states. Upon further review, alterations to the process will be implemented for FY 2015.
There is no clarification as to which variables will be subject to change.
“I don’t know that part, and I’m not sure anybody does,” Schiavoni said.
A vote on the budget bill is expected by June, and is expected to take effect on July 1.