Outcomes-Based Formula Funding for Universities

T E X A S H I G H E R E D U C A T I O N C O O R D I N A T I N G B O A R D W E B I N A R A P R I L 9 , 2 0 1 4

GAIFAC Recommendation – Funding Totals

3 

$235 million in outcomes-based funding pool



OBF pool is equal to 10% of undergraduate formula funding, but:

$5 000M $4 500M $4 000M $3 500M $3 000M $2 500M

OBF I&O-Under graduate, $2,346

OBF - 5.1% More Funding Equal to 10% of Under graduate I&O; $235M

Total; $4 884M



Is outside of and in addition to the I&O formula

$2 000M $1 500M

I&O - Graduate; $1 569M

$1 000M 

Fund I&O and Infrastructure at requested amounts first

$500M $0M

E&G Support; $734M

GAIFAC Recommendation– Success Metrics

4

Total Undergraduate Degrees Total Undergraduate Degrees by Graduation Rate Total Undergraduate Degrees per 100 FTSE At-Risk Undergraduate Degrees Retention Metrics

• Total number of Bachelor’s Degrees awarded by an  institution in a given year.

• Total Bachelor’s Degrees multiplied by the school’s six year graduation rate, to incent timely completion.

• Degrees divided by Full Time Student Equivalents (FTSEs) and multiplied by 100. This aggregate measure adjusts for part-time and transfer students, providing a common framework for comparing degree productivity .

• Degrees awarded to students who meet federal criteria for being at high risk for non-completion.

• Points awarded for students who complete their 30th, 60th, or 90th hour at the institution, to incentivize the use of effective persistence policies.

GAIFAC Recommendation – Allocation

5 

Allocate Funds based on:



Points earned on the 7 success metrics



The average of the three most recent years of data



Points scaled statewide



Points weighted by institutions



Phased-in over three biennia

GAIFAC Recommendation- Allocation

6   Allocation based on each institution’s percent of statewide total points Points are based on an average of the three most recent years of performance data

Institution

A B C Total

Total Points

100 125 175 400

Percent of Total Points

25 31 44 100

Funding (millions)

$58.75

$72.85

$103.4

$235

GAIFAC Recommendation- Point Scales

9 

Scaling adjusts each metrics’ points to ensure  comparability and significance in the model

Three Year Average Percent of Total Scale Scaled Points (A) Factor

Total Undergraduate Degrees By Graduation Rate Per 100 FTSE At-Risk Degrees Retention to 30 Retention to 60 Retention to 90 Total 5,800 23.0% 3,000 32 3,500 7,000 4,000 1,900 11.9% 0.1% 13.9% 27.7% 15.9% 7.5% 25,232 100.0% 1 7 25 7 1.5

2.5

4 5,800 21,000 800 24,500 10,500 10,000 7,600 80,200

Percent of Total

7.2% 26.2% 1.0% 30.5% 13.1% 12.5% 9.5% 100.0%

GAIFAC Recommendation - Weights

10  Each institution decides how to weight its metrics from a predetermined set of options  Each option is used once  Each institution’s weights must  total 100 percent  Omit 1 metric – a weight of 0%  Remain in place for 3 biennia 100% 25% 25% 20% 15% 10% Total 1 2 3 4 5 5% 0% 6 7

Weight

5% 25% 0%

Factor

Total Undergraduate Degrees By Graduation Rate Per 100 FTSE 25% At-Risk Degrees 20% Retention to 30 15% 10% Retention to 60 Retention to 90 100% Total Value Option

GAIFAC Recommendation - Weights

11  Example Institution

Factor

Total Undergraduate Degrees By Graduation Rate Per 100 FTSE At-Risk Degrees Retention to 30 Retention to 60 Retention to 90 Total

Scaled Points (A) Percent of Total Weight (B) Scaled and Weighted Points (A*B) Percent of Total

5,800 7.2% 5% 290 1.8% 21,000 26.2% 800 1.0% 24,500 30.5% 10,500 10,000 7,600 13.1% 12.5% 9.5% 80,200 100.0% 25% 0% 25% 20% 15% 10% 100% 5,250 0 6,125 2,100 1,500 760 16,025 32.8% 0.0% 38.2% 13.1% 9.4% 4.7% 100.0%

GAIFAC Recommendation – Phase-in

 13 The difference between an institution’s percent of statewide OBF funding and percent of statewide undergraduate I&O funding can vary no more than 0.5 percent for FY16-17 and 1 percent for FY18-19.

Undergraduate Instruction and Operations (UGIO) Formula Percent Funded Outcomes-Based Funding (OBF) Percent Funded D 25,00% E 35,00% C 20,00% A 5,00% B 15,00% D 28,25% E 35,00% C 19,75% A 2,50% B 14,50%

GAIFAC Recommendation– Phase-in

14

A Set Aside, 2% OBF 98% C, 19.75% A, 2.50% B, 14.50% E, 35.00% D, 28.25%

GAIFAC Recommendation – Point Distribution: Statewide

15 Retention to 90 Hours 12,5% Total Undergraduate Degrees 1,6% Retention to 60 Hours 12,8% by Graduation Rate 30,6% Retention to 30 Hours 7,5% At-Risk 34,4% per 100 FTSE 0,5%

Retention to 60 Hours 1,1% Retention to 30 Hours 9,2%

GAIFAC Example Point Distribution: Regional Institution

16 Retention to 90 Hours 0,0% Total Undergraduate Degrees 3,5% by Graduation Rate 15,5% At-Risk 42,9% per 100 FTSE 27,9% Statewide

GAIFAC Example Point Distribution: Research Institution

17 Total Undergraduate Degrees 1,5% Retention to 90 Hours 22,7% by Graduation Rate 43,5% Retention to 60 Hours 10,8% Retention to 30 Hours 4,9% At-Risk 16,6% per 100 FTSE 0,0% Statewide

GAIFAC Recommendation – Next Steps

18      

Considered by full Coordinating Board on April 25 Request weights from each institution Conduct a study of the At-Risk Degrees measure Submit Initial Model to the LBB (November 1) Update with FY 2014 data Submit Final Model to the LBB (March 1)

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Total Undergraduate Degrees

Total number of Bachelor’s Degrees  awarded by an institution in a given year.

      Accountability measure #10 Number of degrees reported on the CBM009 – Graduation Report for the fiscal year  Fiscal year 2012 includes fall 2011, spring 2012, and summer 2012 reports Multiple degrees earned by a single student are included Double Majors are counted as a single degree Degrees included   Baccalaureate Associate of Applied Science (AAS) Excludes certificates

20

Total Undergraduate Degrees by 6 Year Graduation Rate

Total Bachelor’s  Degrees multiplied by the school’s six year graduation rate To incent timely completion.

      6-Year Graduation Rate – Accountability measure #9  First-time entering degree-seeking students who enrolled in an minimum of 12 semester credit hours their first fall semester who graduated from the same institution or another Texas public or independent institution after four, five, and six academic years. This metric includes Social Security Number changes submitted on the CBM00N. First-time determined by the first-time student flag on the CBM001. Sources: CBM001, CBM002, CBM009, CBM00N Same Fiscal Year as degrees reported  For fiscal year 2012, cohort started in fall 2006 Includes same and other institutions Upper-Level institutions use 3-Year Completion Rate  First-time junior level students transferring in who graduated from the same institution or another Texas public or independent institution after three academic years.  UT-Brownsville, TAMU-Texarkana, UH-Clear Lake, UH-Victoria, and Sul Ross Rio Grande.

New institutions calculated with parent graduation rate  TAMU-Central Texas, TAMU-San Antonio, and UNT-Dallas.

Example A B

Institution Degrees

9,000 200

Rate

80% 30%

Points 7,200 60

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Total Undergraduate Degrees per 100 FTSE

Degrees divided by Full-Time Student Equivalents (FTSEs) and multiplied by 100. This aggregate measure adjusts for part-time and transfer students, providing a common framework for comparing degree productivity among institutions with different missions and student bodies.

      Degrees same as the first factor Undergraduate Full-time student equivalents (FTSE) – Accountability measure #2  Number of semester credit hours (SCH) reported on the CBM004 – Class Report for the fall of the fiscal year  For fiscal year 2012, fall 2011 Includes state funded undergraduate semester credit hours Excludes non-state funded and graduate semester credit hours Undergraduate Semester Credit Hours divided by 15 to convert to FTSE Example

Degrees

4,930

SCH

255,000

FTSE (SCH/15)

17,000

Points (Degrees/(FTSE/100)) 29

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At-Risk Degrees

Degrees awarded to students who meet federal criteria for being at high risk for non-completion. Indicators are being a federal Pell Grant recipient, below average SAT/ACT score, part-time student, GED recipient, or entering higher education at age 20 or older.

 One point for each student awarded degrees in the first measure that meets one or more of the conditions 1.

Reported by any institution as a “Pell Grant recipient”  in the  Financial Aid Database System (FADS) during the last 10 years 2.

Earned an SAT or ACT score below the national average   Scores reported on the CBM00B – Admissions Report or by the College Board National Averages posted on www.collegeboard.org

or www.act.org

3.

4.

5.

Part-Time (taking less than 12 hours) when reported as first time in college on the CBM001 – Student Report General Education Degree (GED) recipients for the last six years  Data provided by the Texas Education Agency (TEA) upon request 20 or older by date of birth field on the CBM001 – Student Report when reported as first-time in college

Student Received Pell Grant Earned a Below Average SAT or ACT Score First Time in College and Attended less than 12 Received a GED First Time in College and 20 or Older Points

A Yes Yes Yes Yes Yes 1 B C No No No No Yes No No No No No 1 0

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At-Risk – Data Elements

Degrees awarded to students who meet federal criteria for being at high risk for non-completion. Indicators are being a federal Pell Grant recipient, below average SAT/ACT score, part-time student, GED recipient, or entering higher education at age 20 or older.

    CBM009 - Graduation FAD - Financial Aid Database 1B - FICE 1D - Student Social Security Number/ID Number 31A - Federal Pell  2 - Institution Code 3 - Student Identification Number 6 - Date of Birth 7 - Degree Conferred 8 - Level of Degree or Certificate Conferred 9 - Major  CBM001 – Student 2 - Institution Code 3 - Student Identification Number 5 - Classification 6 - Date of Birth 9 - Transfer Student or First-Time-in-College 10A - Semester Credit Hour Load, On-Campus  10 - B Semester Credit Hour Load, Off Campus 13 - Semester 14 - Year 31 - Dual Credit Course Semester Credit Hours CBM00N – Student Number Change 2 - Institution Code 3 - Current Student Identification Number 4 - Current Date of Birth 6 - Prior Student Identification Number 7 - Prior Date of Birth CBM00B - Admissions 2 - Institution Code 3 - Student Identification Number 24 - Application Year 25 - ACT Composite Score 26 - SAT Combined Score TEA GED Data Student Identification Number GED Certification Date SAT and ACT National Averages www.collegeboard.org

www.act.org

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Retention to 30, 60, and 90 Hours

Points awarded for students who complete their 30th, 60th, or 90th hour at the institution.

To incentivize the use of effective persistence policies.

    One point awarded for students successfully completing 30, 60, or 90 hours at the institution as reported on the CBM00S – Student Schedule Report   Last five years – FY 2012 includes data from fall 2007 to summer 2012 Successful completion reported as A, B, C, D, or Credit/Passed in 24  Prior to summer 2011, students receiving a failing grade are included in counts All undergraduate students enrolled at the institution College-level hours earned at the institution currently enrolled   Exclude hours earned at other institutions Exclude developmental education hours Examples

Student

1 2 3 6 7 4 5 8

Hours Earned at the Institution in prior Fiscal Years

0 21 30 45 60 75 90 29

Hours Earned at the Institution in current Fiscal Year

30 24 30 12 30 30 30 45

Total

30 45 60 57 90 105 120 74

Points

1 1 1 0 1 1 0 2

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Retention– Data Elements

Points awarded for students who complete their 30th, 60th, or 90th hour at the institution.

To incentivize the use of effective persistence policies.

 2 - Institution Code 3 - Student Identification Number 5 - Classification 6 - Date of birth 18 - Semester  CBM00N – Student Number change 2 - Institution Code 3 - Current Student Identification Number 4 - Current Date of Birth 6 - Prior Student Identification Number 7 - Prior Date of Birth

Prior to summer 2011

 CBM002 – Texas Success Initiative 2 - Institution Code 3 - Student Identification Number 4 - Reporting period 5 - Year 10A - Semester Credit Hours Completed

Summer 2011 and after

 CBM001 – Student CBM00S – Student Schedule 2 - Institution Code 3 - Student Identification Number 10 - Semester Credit Hour Value 19 - Developmental Education Course/Intervention Level (value=0) 24 - Course Grade (value=1, 2, 3, 4, 8) 29 - Semester