The Higher Education Appropriations Subcommittee approved the Board of Regents’ recommended performance funding model at its October meeting. The Board adopted a revised outcomes-focused model based on legislation passed in the 2017 legislative session. S.B. 117 – Higher Education Performance Funding (Millner/Wilson), establishes the Performance Funding Restricted Account. The account is funded from 14 percent of the estimated revenue growth from targeted jobs in FY 2019, and 20 percent in FY 2020 and thereafter.
The Legislature may send those funds to institutions that have met the required performance metrics set by the Board of Regents. The metrics and weightings used are as follows:
Completion (15%): degrees and certificates awarded
Completion by underserved students (10%): degrees and certificates awarded to underserved students
Responsiveness to workforce needs (25%): degrees and certificates awarded in high market demand fields
Institutional efficiency (50%, 40% for research institutions*): degrees and certificates awarded per full-time student
Research (10% for research institutions*): total research expenditures
*Research institutions=University of Utah and Utah State University
This legislative brief provides more detail on the revised metrics.
Performance Funding has been a part of the funding for institutions in the Utah System of Higher Education for several years at varying, albeit limited, levels. First established in 2013, It was primarily funded on a one-time basis, making it a challenge for institutions to fund ongoing initiatives that drive improved performance. In 2017, the ongoing funding established via the restricted account was the most significant investment in outcomes-based funding to date. At their July meeting, the Board of Regents approved the proposed initiatives of how institutions would invest the funds.
Starting in 2018, future funding to the restricted account is dependent on the estimated revenue growth of targeted “5-Star” jobs as defined by the Utah Department of Workforce Services. Also in 2018, the Utah System of Technical Colleges will be apportioned 10% of the funding increase in the Performance Funding Restricted Account.