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CSI Graduation

President Jeff Fox introduces the guest speaker during the morning graduation ceremony May 11 at the College of Southern Idaho in Twin Falls.

TWIN FALLS — The College of Southern Idaho predicts it could receive $300,000 to $500,000 yearly under a new state funding formula that focuses on student completion.

The Idaho State Board of Education approved a plan Oct. 18 that would significantly change how the state’s colleges and universities — including CSI — receive some of its state money.

Under the outcomes-based funding model, schools would get money based on its number of graduates. It would replace enrollment workload adjustment, which has been in place for 30 years and is based on a three-year average of credits students accrue.

More than 30 U.S. states already use outcomes-based funding, according to a statement earlier this month from the Idaho State Board of Education.

The board will bring a plan to the state Legislature during the 2019 session, which begins in January. “It is the Board’s top legislative priority for the upcoming session,” the board said in a statement.

The education board has worked for three years on developing the model — a three-year phased plan that includes $16 million in new state funding during the first fiscal year, 2020.

As for the potential financial impact to CSI, college officials are looking at working drafts of the formula, President Jeff Fox said Thursday. He expects CSI will see a “positive inflow” — likely, between $300,000 and $500,000 a year.

“We’ve done pretty well on completion metrics the last couple of years,” Fox said. CSI has pushed to recruit students and help them complete their education. “We would do well under the formula.”

It’s a relatively small amount of money, though, if you compare it with CSI’s general fund budget of about $43.9 million.

The board’s approval of outcomes-based funding follows at least three years of “serious, in-depth examination,” Fox said, noting all eight Idaho higher education presidents also previously signed off on the change.

The plan was tweaked a few times, including based on recommendations from Gov. C.L. “Butch” Otter’s Higher Education Task Force.

Fox said he thinks the funding model is better for the state’s colleges and universities. “We’re happy to play in this area.”

Idaho colleges and universities have several sources of state funding. The base allocation for schools wouldn’t be affected by outcomes-based funding, Fox said.

Under the new system, “it’s more of a reward for a job completed as opposed to ‘here’s money up front to educate (students),’” Fox said. “Outcome-based funding is probably the more sensible funding mechanism.”

CSI Executive Vice President Todd Schwarz was on a technical committee that worked on the funding formulas, which are slightly different for each type of school. It was a collaborative effort, Schwarz said Thursday, that focused on “simplicity of design.”

Of the $16 million that could be distributed during the first year, $11 million would be for four-year schools, $3 million for community colleges, and $2 million for career and technical education. CSI falls under both community colleges and CTE.

CSI would receive money based on each student who completes a degree or certificate. The amount would increase using a multiplier if a student graduates in a high-impact occupational area such as STEM (science, technology, engineering or math), health, business or education; they’re economically disadvantaged and are eligible for a federal Pell Grant; or for on-time completion — an associate’s degree in two years or intermediate technical certificate in one year, which Schwarz said doesn’t usually happen.

The controversial measure is more money for schools if students earn degrees in certain occupational areas, Schwarz said. An extreme view would be wondering whether, for example, to offer an English degree at all, he said. “That’s certainly not going to happen.”

Over the years, enrollment workload adjustment — the current funding system — has presented some issues. The philosophical idea, Fox said, was more money is needed to educate more students who are on campus.

But once the economic recession hit about a decade ago, the funding system didn’t work as intended, he said. “It was flawed in some ways to begin with.”

Enrollment exploded during the recession because more people were out of work, Fox said. Since enrollment workload adjustment is partly funded by state revenues, the state didn’t have enough money to cover the increases for higher education, Fox said.

CSI saw its enrollment spike from about 2007 to 2012. Once the recession ended, enrollment dropped back down again.

As of Oct. 15, CSI’s total student headcount was 6,978 students — down 1.2 percent compared with last year. And across south-central Idaho, the regional unemployment rate is extremely low, at 2.2 percent.

For Idaho’s colleges and universities after the recession, “we all lost money because it looked like we were losing enrollment,” Fox said. “We shouldn’t have been penalized on the downside.”

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