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Outcomes-Based Higher Ed Funding Bill Passes Senate

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May 24

A bill that could alter the state's formula funding for institutions of higher education to allow some of it to be based on outcomes such as graduation rates rather than simply enrollment cleared the Senate this evening.

Gov. Rick Perry has made outcomes-based funding one of his legislative priorities with regard to higher education, and the bill — House Bill 9 by House Higher Education Chairman Dan Branch, R-Dallas — appears to be moving toward the governor's desk.

The bill, which already passed the House, was kicked out of the Senate this evening with minor alterations. Now, the House must either concur with the changes or head to conference before it can finally be sent to the governor.

The concept has drawn some opposition. The Texas Faculty Association has expressed concern that it will create a need for institutions to boost graduation rates "by any means necessary," such as lowering standards and course requirements.

While HB 9 limits the portion of base funding that can be based on outcomes to 10 percent, it provides flexibility to the Texas Higher Education Coordinating Board, which supports the concept, to determine the specifics of the formula. The coordinating board would also be required to regularly review its outcomes-based system with institutions.

"A collaborative approach is key to the success of any outcomes-based funding initiative," said Senate Higher Education Chairwoman Judith Zaffirini, D-Laredo, who has been outspoken in her opposition of significant changes to higher education being pushed without public scrutiny and legislative input. "Instead of serving as an edict from on high, this bill would encourage cooperation between colleges and universities, the coordinating board and the Legislature. What's more, it would engage institutions in identifying and evaluating the most effective measures of student success."

Zaffirini, who sponsored HB 9 in the Senate, and Branch co-chair a recently created Joint Oversight Committee on Higher Education Governance, Excellence and Transparency. The bill would require the coordinating board to develop a report that identifies best practices for those issues and submit it to the committee.

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