DEPARTMENT OF COMMUNITY COLLEGES AND WORKFORCE DEVELOPMENT

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DEPARTMENT OF COMMUNITY COLLEGES AND WORKFORCE
DEVELOPMENT

• COMMUNITY COLLEGE SUPPORT FUND
• Support Fund Distribution Formula and
  Implementation
• Support Fund Request and Implications
• Options
• Impact of Budget Reductions on Community
  Colleges              

April 17, 2003 Presented to Ways Means
Education Subcommittee By Cam Preus-Braly
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Community College Mission Statutory ORS 341.009
(1)

• The community college is an educational
  institution which is intended to fill the
  institutional gap in education by offering broad,
  comprehensive programs in academic as well as
  professional technical subjects.
• It is primarily designed to provide associate or
  certificate degree programs for some, serve a
  transitional purpose for others who will continue
  baccalaureate or other college work, provide the
  ability to enter the workforce immediately and
  serve to determine future educational needs for
  other students.
• It can provide means for continuation of academic
  education, professional technical training or the
  attainment of entirely new skills as demands for
  old skills and old occupations are supplanted by
  new technologies.
• It may also provide the means to coordinate
  courses and programs with high schools to enhance
  the Certificate of Advanced Mastery and to
  accommodate successful transition to college
  degree programs.

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State Board of Education Policies

• The State Board of Education has statutory
  authority to govern Oregons community college
  districts
• As part of that responsibility, the State Board
  has the authority to develop and implement a
  formula for the distribution of state resources
  to fund community colleges
• The State Board develops the formula within the
  policy framework of access and equity

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State Board of Education Policies

• Access All Oregonians should have access to
  community college services regardless of where
  they live
• Equity Each college should receive the same
  funding per student
• Quality In January of 2003 adopted a freeze on
  enrollments to stop the erosion of the dollar
  value of an FTE

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Funding Formula

• The passage Ballot Measure 5 in 1991
  fundamentally changed the funding of community
  colleges
• Over time, state resources have grown to be the
  largest share of revenue for local community
  college districts

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Community College Primary Sources of Revenue
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Funding Formula

• As the State Board and CCWD staff looked to the
  future, it became apparent that a new formula
  would need to be adopted
• In 1991-93, a temporary formula was enacted in
  which community colleges received a proportional
  share of state funds based on past allocations
• Early versions of the current funding formula
  were first adopted in the 1993-95 biennium

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Funding Formula Principles

• The overarching principles of the new formula
  were
• Provide equity in the distribution of resources
• Provide a base for infrastructure and school size
• Equalize property tax revenues per student
• Funding follows the student
• These principles continue to be reflected in the
  current funding formula

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Funding Formula Implementation

• Individual elements within the funding formula
  have stayed relatively unchanged since its
  adoption in 1993-95
• 50 of local property taxes are included
• A base factor is included to reflect the
  differences in college size
• Full-time equivalent enrollments (FTE) are the
  basis for distribution following students

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Basic Formula Equation
plus
State Appropriation
50 of Imposed Property Taxes
Equals
Total Formula Funds
Minus
Base Funding
Divided by
Enrollments
Equals
Funds per FTE
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Future of Funding Formula

• In January of 2003 the State Board of Education
  directed CCWD to work with the Community College
  Presidents Council to review and recommend a new
  formula for 2005-07
• Members include
• Wes Channell, Klamath CC, Chair
• Mary Spilde, Lane CC
• Jess Carreon, Portland CC
• Bob Barber, Central Oregon CC
• Joe Johnson, Clackamas CC
• Travis Kirkland, Blue Mountain CC

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Property Taxes
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Impact of Property Taxes on Distribution of State
Resources

• No property tax revenues actually leave districts
• Including one-half of local property taxes in the
  formula does affect the amount of state funds
  that a community college receives
• The following chart indicates which colleges gain
  or lose state funds as a result of property taxes
  being included in the formula

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Impact of Property Taxes on Distribution
Projections based on funding included in
Governors Budget
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Projected State Property Taxes per FTE
Property Taxes Included in Formula
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Projected State Property Taxes per FTE
Property Taxes Excluded from Formula
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Comparisons with OUS and K-12
Property Taxes Community Colleges 50 of property taxes imposed included in formula OUS No property tax support for public universities K-12 100 of property taxes included in formula
State Aid Significant source of revenues for all three education sectors
Tuition Community Colleges Provides about 1/3 of local revenues OUS Large source of revenue K-12 Not a source of revenue for public schools
Enrollments Community colleges Used in the formula as basis for distribution of state funds OUS Used in the RAM as basis for distribution of state funds K-12 ADMw used as basis for distribution of state funds
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State Support for Community CollegesHistorically

• Current service plus inflationbiennial
  allocation
• Not reflective of increases in student enrollment
• No connection to the actual average cost of
  serving a student

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New Approach to Community College Funding in 2001

• Budget request based on
• conservative projection of student enrollment
• statewide average cost to serve a student
• Average cost per student derived from national
  reporting (IPEDS) and college revenue and
  expenditure reports

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2001 Community College Support Fund Appropriation

• appropriated 464 million for student enrollment
  of 192,005
• legislature funded 45.9 of projected cost of
  community college full-time equivalent students
• 32 million, of the 45 million community college
  enrollment growth appropriation, was lost to
  state budget reductions

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Agency Request 2003-2005
2,483 2003-05 state share of average cost per
student (45 of projected cost) 208,905
multiplied by students (derived from 3
increase in reimbursable FTE per year) 518.75
million
.
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Enrollment Scenarios
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State Funding Assumptions
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Enrollment Scenarios Including Agency Request
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Budget Numbers
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Columbia 2,884 6.5
Community Colleges
Clatsop 5,894 16.3
Multnomah 73,607 11.0
Hood R. 2,373 11.6
Umatilla 7,008 10.0
Wallowa 305 4.3
Wash. 44,531 9.6
Tillamook 3,813 15.5
Sherman 137 7.4
Morrow 815 7.2
Gilliam 98 5.2
Union 582 2.4
Yamhill 6,469 7.4
Clackamas 33,438 9.5
Wasco 2,974 12.5
Polk 5,962 9.4
Marion 35,494 12.2
Wheeler 78 5.0
Baker 755 4.5
Lincoln 4,427 9.9
Jefferson 1,631 8.2
Linn 14,396 13.8
Benton 11,918 14.9
Grant 374 4.8
Crook 1,283 6.4
Lane 37,054 11.3
Deschutes 13,468 10.6
Harney 212 2.8
Malheur 3,859 12.1
Lake 639 8.6
Coos 10,655 17.0
Douglas 16,233 16.0

• CC Students by County
• Total Students Enrolled, 2001-02
• of Population Enrolled

Curry 2,330 11.0
Klamath 2,836 4.4
Jackson 7,220 3.8
Josephine 5,379 3.8
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All Students2001-02
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Community Colleges Served 406,434 Students in
2001-02
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Increased Student Demand Over the Last Decade
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Increased Demand for Highly Skilled Workforce

• Oregons future will depend on having a critical
  mass of highly skilled technology workers and
  researchers.
• We need to immediately retrain existing workers
  for todays high demand jobs.
• Oregon Council for Knowledge and Economic
  Development Report, 2002
• The current supply of graduates produced by
  Oregons community colleges and universities
  falls short of the demand created by new
  positions and vacancies in these critical
  shortage fields.
• Final Report of the Interim Task Force on Health
  Care Personnel, 2002

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The Capacity Gap

• Nursing and Allied Health Programs are full but
  colleges do not have funds to expand to meet
  market demand.
• Waiting lists for ESL classes
• Funding cuts fewer programs, classes, seats
  statewide
• Physical plants in need of repair or expansion to
  meet the need for classroom and lab space.

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The Capacity Gap

• Professional Technical Programs are the training
  ground for a highly skilled workforce.
• But in 2001-2003 the gap in PT programs grew
• 15 AAS Programs were suspended
• 12 Certificate Programs were suspended
• 17 AAS Programs were deleted
• 8 Certificate Programs were deleted

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What are the Options?

• The capfreezing funding allocations to last
  years levels.
• More !
• Differentiated Funding
• Greater reliance on grant and other funds
• Cost savings cut staff, cut programs, cut
  courses
• Tuition Strategies
• Raising Tuition
• Differentiated Tuition

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Tuition/Fees

• Tuition increased 12 this year
• rates are set by local college boards.
• state average yearly tuition and fees for
• a full-time in-district student 2,337
• tuition for 2002-03 ranges from 40-55
• per credit
• Projected average increase next year of 8 or
  6.35 per credit for a range of 45 to 60

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Community College Tuition
02-03 increase 12 03-04 projected 8 Student
share of their education for the decade 1992 to
2002 increased from 22 to 33
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2002-03 Annual Tuition and Fees Cost to Students
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Socio-Economic Benefits

• Return on investment (source CC Benefits Inc.
  Study, March 2002)
• 17 ROI in Oregons Community Colleges.
• The state of Oregon benefits from improved
  health, reduced welfare, unemployment and crime
  saving the public 61.5 million per year.
• Benefits of a community college education
  (Bureau of Labor Statistics publication)
• Increase wages 100 to 400 per week
• Decreases likelihood of unemployment by 50