StrategyLabs.LuminaFoundation.org Outcomes-Based Funding & the Student Completion Agenda Presented by: Jimmy Clarke, Ph.D. & Martha Snyder HCM Strategists,

StrategyLabs.LuminaFoundation.org

Outcomes-Based Funding & the

Student Completion Agenda

Presented by:Jimmy Clarke, Ph.D.

& Martha Snyder

HCM Strategists, LLCDecember 7, 2015

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Supported by Lumina Foundation

Open platform for leaders and influencers in all 50 states to share research and data, encourage peer learning and professional experiences to advance Goal 2025.

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State Policy Agenda

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Create Smarter Pathways

Improve Student Outcomes

Align Investments

• Attainment and Equity Goals

• Strategic Plans• Data systems

• “Affordability”• Need-based financial

aid & design• Outcomes-based

funding

• Transfer policies• Accelerated programs• K-12 CCR alignment• Returning Adults

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Objectives

• Introduce non-partisan research to a broad group of state stakeholders

• Improve awareness of data, the needs of the state, and policy options; and

• Build understanding to inform adoption, enhancement and sustainability of public policies that can help improve student outcomes.

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Support and Resources Provided• Non-partisan, evidence-based policy expertise

– Writing, webinars, on-site support– Speakers and discussants at meetings

• Convening and Facilitation– Peer learning engagements in states to share lessons, challenges– Multi-state discussions to explore ideas with researchers and experts– Meeting preparation and facilitation (board meetings, workshops)

• Advising Policymakers– Non-partisan testimony– Individualized briefings

• Research– Original data collection and analysis– Written analysis of policy alternatives and alignment to research-

informed best practices– Translational research

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ALIGNING INVESTMENTS TO SUPPORT STUDENT COMPLETION: OUTCOMES-BASED FUNDING

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Policy Rationale for Performance Funding

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Align funding method with state/system prioritiesCompletion/Attainment

Jobs/Economic Development

Align institution priorities Support Scaling of Proven Student Success

Practices

Programmatic Evaluation and Change

Improve Efficiency & Reward Outcomes

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State Funding Models

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• Allocation based on prior levels of funding• Adjusted +/- based on available funds• Goal: Institutional fiscal stability• Challenge: Equity in institutional funding

Historic

• # of students enrolled at census date• Recent shift to course completion• Goal: expand access• Challenge: Incentive on prolonged persistence/retention

Enrollment

• Reward for reaching performance milestones or goals• Completion not necessarily key objective• Often ‘bonus’ (new allocation) or small % of general allocation• Challenge: Sustainability and funding

Early Performance

• Funding based on student success and completion• Significant portion of general allocation to institutions (not

reliant on new money-only/separate allocation)• Challenge: College’s ability to respond

Outcome-Based

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Outcomes-Based vs. Performance-Based Funding: What’s the Difference

• Performance Funding: Broad set of policies linking allocation of resources to accomplishment of certain desired goals. Historically:– Often add-ons or bonuses to institution core state funding or small amounts of

reallocated dollars;– Metrics: broad, contradicting, not tied to state’s completion or attainment goals

(e.g., increased access, diversity in faculty higher expenditures on research)– Design: One-size fits all, vague measures, target-oriented

• Outcomes-Based Funding: Evolved form of performance-based funding– More explicit connection to state needs

• Focus on student progress and completion• Closing gaps in student outcomes (at-risk students prioritized)• More money at stake; part of core allocation to institutions

– Refined development & modeling approaches: all institutions included with differentiation to reflect mission

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Arkansas Goals & Finance Policies

Goals & Priorities• Support 2025 Goal of 60%

attainment– Increase number of postsecondary

credentials by 50%– Increase enrollment of adult

students– Raise attainment rate of

underserved students– Affordability/reduce time to degree

• Strategies– Course redesign (remedial &

gateway)– Guided pathways– Student service innovations

Current Funding Model• Primarily enrollment + cost based• Performance component based on

predetermined targets (punitive)• Disconnected from broader

attainment and completion priorities– Does not promote wide-scale

adoption of identified strategies– Limited focus on priority

populations (adult and underserved)

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Design Principles for Outcomes-Based Funding

Begin with a state goal/clear policy priorities

Use a simple approach

All public institutions

included, reflect mission

Incent success of typically

underrepresented students

Make the money

meaningful

Seek Stakeholder

Input

Phase-in (≠ Hold

Harmless)

Include only measurable

metrics

Plan to evaluate

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Common Measures

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Type of Measures ExamplesStudent Progression and Momentum Intermediate outcomes/key milestones important to student’s progression toward completion

• Remedial education success• Completion of first college-level mathematics

and English courses• Credit accumulation (e.g. 15, 30 credit hours)

Completion & OutcomesPromote certificate, degree completion, transfer

• Number or rate of program completers• Number of transfers• Job Placement

Productivity & Institution MissionPromote efficiency, affordability and focusing dollars on core mission functions

• Degrees per 100 FTE• Research• Workforce Training

Priority Student categories and/or degree types that are a priority for the state to meet attainment and job needs. Student focus is on progression and completion, not just access.

• Adult students• Academically underprepared students• Low-income (Pell-eligible) students• Minority students• STEM-H degreesNote: often reflected by providing an extra weight to progression and completion metrics

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FY 2015: Implementation of Performance/Outcomes-Based Funding Models

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Outcomes/Performance-Based Funding as % of Institution Funding Support

* ND and WY formulas are based on course-completions only; no other measures such as degree completions, are used. Nevada’s formula is about 96 percent course completion, with approximately 3.8 percent distributed on degree completion and student progression measures.

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Outcomes-Based Funding: Research & Impacts• Focused mostly on early performance funding

policies; beginning to track effect of more robust outcomes-based funding policies

• Research is almost entirely focused on intermediate (institutional change) impacts

• Limited information/ability to understand ultimate impact (scarce research)

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Research and Impacts

⁺ Change in colleges’ awareness of state priorities & own performance

⁺ Reported increase in use of data in institutional planning• identify student barriers• align institution policies/investments

⁺ Academic program improvements• Academic departments: staffing and structure changes• Academic delivery: program structure (remedial education)

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Research and Impacts

⁺ Student Services• Registration, graduation procedures, financial aid• First-year retention programs• Targeted student advising, tutoring and supplemental services• Job placement services

⁻ Concern over⁻ Quality⁻ Instability of funding ⁻ Uneven knowledge of performance funding across and within colleges

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Considerations for Boards of Trustees in Outcomes-Based Funding Environment

• Focus on the Data– Student enrollment– Student progression – Student Completion– Disaggregated

• Support a culture of completion and success– Engage leadership on priorities– Evaluate all aspects of institutional operations– Help communicate support and engage all campus

stakeholders in conversation

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