Taking a Page From K–12 School Funding

By Ellen Ullman

A new report from The Century Foundation concludes that higher education needs to fix its broken funding model.

“How Higher Education Funding Shortchanges Community Colleges,” a report released in May by The Century Foundation, says the greatest amount of money in higher education goes to the most affluent students and shortchanges community college students who, for the most part, come from low-income and working-class backgrounds.

One of the report’s most discussed figures shows that Princeton University receives around $105,000 per pupil in public subsidies (primarily through tax breaks). Community colleges, which play an important role for the aspiring middle class, have consistently received fewer public funds. In fact, community colleges have decreased spending by $900 per student over the past decade.

“Higher-ed funding is inefficient and immoral, in my view,” says Richard Kahlenberg, a senior fellow at The Century Foundation and the author of the report. “I think policy makers would like to place more accountability on higher ed, but if they are going to do that, they have to provide the resources necessary for community colleges to do the job.”

First steps to fixing the funding problem

The report looks favorably at K–12 funding streams to serve as a model for higher education. That’s because nearly two-thirds of our nation’s states have systems in place to ensure that funding goes to students who have greater needs.

In order to better align our current funding streams, the report recommends three steps. First, there needs to be a comprehensive study to find out how the money is currently allocated.

Next, the government or a foundation must undertake a study to figure out how much more funding economically disadvantaged higher-ed students get. According to Kahlenberg, these studies are common in K–12 and have determined that low-income students get 40 percent more funding than middle-class students to address the extra obstacles.

The third step would be to assimilate the research from the two studies.

Some states are already taking positive measures

Kahlenberg says he was encouraged to discover that a number of states are considering weighting funding in favor of disadvantaged students.

Tennessee, for example, provides a 40 percent funding premium to colleges and universities that are successful with low-income students (defined as anyone eligible for a Pell grant). This method benefits community colleges as well as four-year institutions that have a concentration of low-income students.

“Because the thrust of Tennessee’s program is to fund results rather than inputs, it was seen as a conservative idea and had bipartisan support,” says Kahlenberg. Even better, some of the state’s higher education officials are considering increasing the premium from 40 percent to 100 percent.

Thirty-five states currently use a funding model in which some of the higher-education dollars are based on student performance. Although this may seem like a positive step, Kahlenberg warns of the potential danger if colleges seek to exclude low-income students because, on average, they are less likely to perform well.

Improving student outcomes

Once community colleges receive additional funding, they can use the money to offer the academic, social and financial support to help low-income students succeed. One step is to hire additional full-time faculty members. Kahlenberg says research indicates that full-time teachers produce better results because they spend more time on campus and are able to provide extra academic support.

Colleges can also increase support for low-income students. One successful program to consider is City University of New York’s Accelerated Study in Associate Programs (ASAP), which offers block scheduling, small class size, counseling, free textbooks and free subway transportation.

Ellen Ullman

is a contributor to the 21st-Century Center.

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