IDAHO FALLS — Higher education funding will be upended in Idaho, and that’s a reality “everyone has to accept,” Jennifer White, the new executive director for the State Board of Education, told lawmakers Monday. 

At an interim session of the Joint Finance-Appropriations Committee, or JFAC, White spearheaded a conversation on revamping a decades-old funding formula.

Lawmakers are pushing for a transition from an enrollment-based model to outcomes-based funding. The move will inevitably lead to “winners and losers,” said Rep. James Petzke, R-Meridian, “because some institutions have higher outcomes than others.”

That’s made attempts to revise the formula unpopular in the past, Petzke said. This time around, he wants to ensure White has institutional support. 

“The goal is to serve students,” White said. “With students in mind, I’m very hopeful that (higher education leaders will) be able to come to the table and be prepared to have the hard conversations around this.”

“There’s no way to build a perfect formula,” she continued. “People are just going to have to prepare to be unhappy.”

While a much-discussed K-12 funding formula rewrite would require a change in Idaho law, the State Board can revamp the higher education funding formula on its own, said Rep. Wendy Horman, R-Idaho Falls, JFAC’s House co-chair.

An outcomes-based model means “rewarding people who are succeeding and improving and demonstrating growth,” Horman said.

But White said redoing higher ed funding will be a “multiyear process.”

Lawmakers say a change in funding will spark a change in higher ed’s status quo

Colleges and universities are going “to have to relearn how to do business … they’re going to have to reshape, and if they don’t understand that they are going to suffer losses one way or another,” said Rep. Steve Miller, R-Fairfield.

A college or university’s ultimate goal should be to help students graduate at the lowest cost possible while still ensuring they enter the workforce and find the best opportunity, Miller said. “If the institutions want to do other things, they need to figure out how to finance those other things.”

“And I think it’s very important that all of our universities, all of our education systems across the state, remember that we have traditional values,” Miller continued. “That needs to be part of this criteria … in terms of funding.”

JFAC met at the College of Eastern Idaho, which Horman touted as the type of postsecondary institution lawmakers want to see going forward: one based on industry partnerships and focused on efficiently moving students into careers. 

“Colleges have to get into that mindset of being market-driven,” she said. “(CEI) is letting industry create curriculum and define skills … that’s to everyone’s advantage when it comes to outcomes.”

In past attempts to revise the funding formula, one mistake has been not “thinking broadly enough about what to reward,” Horman said. That punished community colleges, which weren’t rewarded for “the things they do best, like workforce development and credentials and certificates, not just diplomas.”

What a funding revamp might entail

The current funding structure, which is tied to enrollment and involves a complex weighting system, was “designed to incentivize recruitment and retention, which has served our state for some time,” White said. But the time has come to think about “outcomes for our students.”

An outcomes-based formula would likely include certificates and degrees, White said. This would address concerns that a new formula would harm colleges with nontraditional students, or students in career-technical programs.

Rep. Rod Furniss, R-Rigby, said outcomes-based funding should also be tied to students’ job placement after graduation. But White said that data is often difficult to track down. 

White also asked lawmakers for direction on how to weight for demographics, such as rural or low-income student populations. 

“I don’t want to create an incentivized structure where we start losing track of those students,” she said. 

In addition to rethinking the higher ed funding model, White said she plans to simultaneously begin a “tuition interrogation, and I use that language very intentionally.”

Her staff will begin by analyzing nationwide tuition models in search of best practices. 

“We really need to think about long-term affordability for our students,” White said. “I don’t think we can talk about the money that you all are putting into higher education without also talking about the amounts that are ultimately being charged to our students.”