New college funding formula emphasizes graduating students

The commission will vote on the revamped formula July 14 at its annual summer meeting. If approved, the commission will use the formula to calculate funding for colleges for fiscal year 2007.

The funding formula was last established in the early 1980s. State officials had complained that it was too complex and did not award money to colleges fairly. Last year, the state General Assembly passed a law requiring the commission to change the formula.

The committee that worked on the new the formula included commission staff members and four representatives from each of the state’s two governing boards — the University of Tennessee Board of Trustees and the Tennessee Board of Regents.

The formula to be considered rewards campuses for retaining and graduating students, not simply enrolling them, said Dr. Brian Noland with the commission. The change will mean state appropriations for higher education are split differently among the state’s 52 campuses.

Campuses will receive more money by meeting the formula’s goals, such as gaining research grants and improving retention rates.

“All of us came to the realization that the operating premises under which higher education had been working were no longer valid,” Noland, associate executive director for policy, told the Chattanooga Times Free Press.

The new formula includes the use of current enrollment and salary data, which helps give a more accurate picture of colleges’ financial needs, said Russ Deaton, director of fiscal analysis for the commission.

It also rewards universities for pursuing research funding and community colleges for enrolling adult students, he said.

“It’s mainly simplification, trying to make (the formula) simpler and easier to understand for the campuses and legislators,” Deaton said. “The old formula had a lot of nuanced, specific calculations that had outlived their usefulness.”

The formula used now includes calculations for library rates, salary supplements and student aid.