Tennessee Higher Education Commission 2013-14 Higher Education Recommendations & Finance Overview November 15, 2012.

Tennessee Higher Education Commission

2013-14 Higher Education 2013-14 Higher Education Recommendations & Finance Recommendations & Finance

OverviewOverviewNovember 15, 2012November 15, 2012


Finance Background Data

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TN Outcomes-Based Formula

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-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Total Revenue per FTE4 Year Institutions

Inflation Adjusted - 2011 Dollars

State Appropriations Student Fees Less Grant Aid (TSAA, TELS, Pell) Grant Aid5



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Overview of Phase-In Period

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Hold Harmless Policy Phase-out Begins

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Cumulative Change in Appropriations at Universities Due to the Formula

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Cumulative Change in Appropriations at Community Colleges Due to the Formula

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Financial Aid Background Data

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• Federal government’s Free Application for Federal Student Aid, or FAFSA.

• Expected Family Contribution (EFC).

• A proxy for a student’s ability to pay for college.

• Basis for awarding need-based financial aid such as the Federal Pell grant and the Tennessee Student Assistance Award (TSAA).

Student Income Profile

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0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2007

TSAA Eligible ($40K) PELL Eligible ($60K)



Of the 120,000 students who filed a FAFSA in 2007, 52

percent were Pell eligible.

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-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2011 2007

TSAA Eligible ($40K) PELL Eligible ($60K)



Of the 164,000 students who filed a FAFSA in 2011, 62

percent were Pell eligible.

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Of all community college students who filed a FAFSA in 2011…

• 74 percent were Pell/TSAA eligible.• 84 percent of adults students were Pell/TSAA

eligible.• 52 percent had a zero EFC.• From 2007 to 2011, the proportion of students who

had an EFC of zero increased from 34% to 52%.• Northeast CC had the highest FAFSA completion

rate at 76%.19

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Of all university students who filed a FAFSA in 2011…

• 53 percent were Pell/TSAA eligible.• 32 percent had a zero EFC.• From 2007 to 2011, the proportion of students who

had an EFC of zero increased from 20% to 32%.• Tennessee Tech had the highest FAFSA completion

rate at 85%.

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Student Financial Aid

Sources: THEC, TSAC, US Dept. Education

2010-11 Recipients Universities CCs TTCs TotalPell Grants 53,893 56,962 10,432 121,287

TSAA 13,101 9,626 2,074 24,801 Lottery Programs 48,966 23,747 14,424 87,137

Subtotals 115,960 90,335 26,930 233,225

Out of 247,000 students in public higher education, over 121,000 received a Pell grant

and more than 87,000 benefited from the lottery program.

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Student Financial AidSources: THEC, TSAC, US Dept. Education

In 2010-11 public higher education collected over $1.1 billion in gross tuition revenue,

which was offset by $730 million in federal and state grants.

2010-11 Awards Universities CCs TTCs TotalPell Grants $225,516,000 $203,582,000 $29,099,000 $458,197,000

TSAA $22,500,000 $8,817,000 $932,000 $32,249,000Lottery Programs $193,205,000 $30,296,000 $15,321,000 $238,822,000

Total Grants $441,221,000 $242,695,000 $45,352,000 $729,268,000

Tuition Revenue* $807,750,000 $274,962,000 $26,817,000 $1,109,529,000Percent 54.6% 88.3% 169.1% 65.7%

*University Tuition Revenue is an estimate of undergraduate students only.

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• Average debt for a TN university graduate (public and private) was $20,700 in 2011.

• This was the 6th lowest debt level in the nation. In 2005, TN had the 34th lowest debt level.

• 53 percent of TN graduates had debt, the 11th lowest percentage in the nation.

Student Debt

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$18,259

$26,600

$19,701

$20,703

16,000

18,000

20,000

22,000

24,000

26,000

28,000

2005 2006 2007 2008 2009 2010 2011

National Average

Tennessee

TN Rank34/46 26/46 25/51 22/49 18/49 9/50 6/48


Student Debt AnalysisSource: Project on Student Debt Database

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Student Debt Analysis

Institution Debt 2011Default Rate*

% Low-Income**

APSU 20,335$ 16.6% 64%ETSU 20,984 14.1% 56%MTSU 21,484 12.3% 54%TSU 22,984 13.7% 79%TTU 9,952 3.9% 48%UM 25,629 9.2% 63%UTK 20,926 8.0% 36%UTC 13,845 12.1% 44%UTM 23,328 16.1% 58%

Sources: Project on Student Debt Database and Federal Student Aid

*Default rates are the 2009 3-year cohort default rates**All FAFSA filers in 2011 who were Pell Eligible.Note: Debt figures for ETSU are from 2010.

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Student Debt Analysis

Institution Default Rate*% Low-

Income**ChSCC 26.6% 75%ClSCC 21.0% 76%CoSCC 20.2% 68%DSCC 21.7% 78%JSCC - 79%MSCC 14.4% 65%NaSCC 21.8% 79%NeSCC 27.0% 75%PSCC 20.7% 65%RSCC 19.2% 72%STCC - 88%VSCC 12.1% 68%WSCC 16.1% 71%

Note: JSCC and STCC do not participate in the federal student loan program.Source: Federal Student Aid

*Default rates are the 2009 3-year cohort default rates**All FAFSA filers in 2011 who were Pell Eligible.

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Low Student Debt Factors

• Emergence of lottery scholarship.

• Protection of TSAA from budget cuts.

• Institutional and TSAC default prevention programs.

• Elevation of financial literacy programs.

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2013-14 Recommendations Summary

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2013-14 Overview

• 2013-14 is the 3rd and final year of the phase-in period.

• Outcomes model is fully phased in and the Hold Harmless provision is fully phased out.

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2013-14 Overview

• Outcome data has undergone significant improvement over last two years.

• Annual meetings of Data Quality Roundtable; Formula Data Committee; Auditors meeting.

• Intensive efforts since summer 2012 to align UT, TBR, THEC data.

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Productivity Changes

Outcomes 2012-13 2013-14Students Accumulating 12 hrs 33,292 30,595 (2,697) -8.1%Students Accumulating 24 hrs 23,889 22,545 (1,344) -5.6%Students Accumulating 36 hrs 18,264 17,734 (530) -2.9%

Dual Enrollment 10,702 11,957 1,255 11.7%Associates 7,382 8,312 930 12.6%

Certificates 1-2 Year 625 676 51 8.1%Certificates <1 Year 1,096 1,220 124 11.3%

Job Placements 3,482 3,757 276 7.9%Remedial & Developmental Success 21,521 23,560 2,039 9.5%

Student Transfers 5,432 5,767 336 6.2%Workforce Training (Contact Hours) 580,470 729,085 148,615 25.6%

Community CollegesChange

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Outcomes 2012-13 2013-14Adults Accumulating 12 hrs 10,188 9,260 (928) -9.1%Adults Accumulating 24 hrs 8,489 8,084 (405) -4.8%Adults Accumulating 36 hrs 7,254 7,198 (56) -0.8%

Adult Associates 4,167 4,657 490 11.8%Adult 1-2 Year Certificates 411 443 33 8.0%

Adult <1yr Certificates 714 801 87 12.2%Low-income Accumulating 12 hrs 21,671 19,283 (2,388) -11.0%Low-income Accumulating 24 hrs 15,614 14,578 (1,036) -6.6%Low-income Accumulating 36 hrs 11,842 11,501 (341) -2.9%

Low-income Associates 3,970 5,148 1,179 29.7%Low-income 1-2 Year Certificates 311 354 43 13.9%

Low-income <1yr Certificates 557 636 79 14.2%

Community Colleges - Sub-PopulationsChange

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Outcomes 2012-13 2013-14Students Accumulating 24 hrs 19,949 19,148 (800) -4.0%Students Accumulating 48 hrs 18,773 18,307 (466) -2.5%Students Accumulating 72 hrs 19,713 19,367 (345) -1.8%

Bachelors and Associates 18,656 19,365 708 3.8%Masters / Ed Specialists 5,793 5,892 99 1.7%

Doctoral / Law Degree 968 1,015 47 4.8%Research and Service 315,862,178 320,173,511 4,311,333 1.4%

Student Transfers 2,919 3,240 321 11.0%

ChangeUniversities


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Outcomes 2012-13 2013-14Adults Accumulating 24 hrs 1,374 1,269 (105) -7.6%Adults Accumulating 48 hrs 1,869 1,777 (91) -4.9%Adults Accumulating 72 hrs 2,947 2,901 (46) -1.6%

Adults Bachelors and Associates 6,522 6,707 185 2.8%Low-income Accumulating 24 hrs 9,565 8,894 (670) -7.0%Low-income Accumulating 48 hrs 8,746 8,460 (285) -3.3%Low-income Accumulating 72 hrs 9,255 9,056 (199) -2.1%

Low-income Bachelors and Associates 7,685 8,901 1,217 15.8%

ChangeUniversities - Sub-Populations


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2013-14 Recommendation Summary - Operating

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State Appropriation Recommendations

• $35.5M to fund outcome growth.

• $14M for Non-formula units.

• 33.6M for TSAA financial aid.

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Outcomes Formula Analysis

Baseline* 519,700$ WeightsStudents Accumulating 24 hrs (54,600)$ 3.0%Students Accumulating 36 hrs (57,000)$ 5.0%Students Accumulating 48 hrs 69,500$ 7.0%Bachelors and Associates Degrees 848,500$ 25.0%Masters and Ed Specialists Degrees 180,000$ 15.0%Doctoral and Law Degrees** 121,400$ 7.5%Research and Service 284,300$ 12.5%Transfers Out with 12 hours 22,100$ 5.0%Degrees per 100 FTE 34,600$ 10.0%Six-Year Graduation Rate (2,300)$ 10.0%Faculty Salary 877,400$ Maintenance and Operation 450,600$ Equipment 48,600$ Performance Funding 35,100$ Out of State Tuition (852,400)$ Total Increase 2,525,500$

**Does not include medical degrees awarded at ETSU College of Medicine.

*Baseline represents the change in appropriations in 2013-14 if no formula elements had changed at all for the institution.

East Tennessee State UniversityComponent Impact on 2013-14 State Appropriations

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State Appropriation Recommendations

• $15.7 for TTC/CC Equipment Replenishment.

• $1M for Higher Education Innovation Fund.

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2013-14 Recommendation Summary - Tuition

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Tuition Recommendations

• Affordability and financial aid;

• Student income profile;

• Institutional revenues and cost inflation.

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Tuition ComparisonsResident Peer Fees TNUndergrad Fees 12-13 2012-13 +/- % Rank Peer Max Peer MinAPSU $6,918 $6,657 3.9% 7 $8,120 $4,553ETSU $6,997 $6,825 2.5% 7 $9,148 $4,553MTSU $7,492 $7,087 5.7% 5 $9,664 $5,040TSU $6,702 $7,239 -7.4% 9 $9,664 $4,553TTU $7,000 $6,860 2.0% 7 $8,794 $4,553UM $8,234 $8,829 -6.7% 10 $10,488 $6,330UTC $7,212 $6,485 11.2% 3 $8,120 $4,553UTK $9,092 $9,447 -3.8% 7 $12,340 $6,989UTM $7,042 $7,850 -10.3% 9 $13,406 $6,199CCs $3,684 $3,471 6.1% 7 $6,310 $2,090

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• THEC Tuition Model as a guide.

• Revenue projections based on inflation, enrollment changes.


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• Assuming $35.5M in new state funding;

• Assuming 3% inflation and no enrollment growth, tuition would need to increase by:

• University average = 2.5%;

• Community colleges = 1.4%.


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• Up to 6 Percent at Universities

• Up to 3 Percent at TTCs & Community Colleges

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2013-14 Recommendation Summary - Capital

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Capital Projects

• Continuation of 5 year plan.

• Institutional match component.

• Full project planning funded out of institutional match.

• Alignment with CCTA.

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Capital Projects

• $289M for seven capital outlay projects.

• $104M for 69 capital maintenance projects.

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2013-14 Higher Education 2013-14 Higher Education Recommendations & Finance Recommendations & Finance

OverviewOverviewNovember 15, 2012November 15, 2012

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Tennessee Higher Education Commission 2013-14 Higher Education Recommendations & Finance Overview November 15, 2012.

Documents

public higher education

tennessee tech

federal student aid

percent of adults students

proportion of students

university students

students ability

pell eligible