Funding of Higher Education’s Performance Pool, Economic and Workforce Development, and Research Subcommittee

June 26, 2012

David Zeh provided testimony at a meeting of the Nevada Legislature’s Economic, Workforce Development and Research Committee regarding the Funding of Higher Education’s Performance Pool.   The full testimony can be found below:

Assemblyman Paul Aizley

Chair
Funding of Higher Education’s Performance Pool, Economic and Workforce Development, and Research Subcommittee

Thank you Chairman Aizley for this opportunity for public comment. My name is David Zeh, and I am Chair of the University of Nevada Reno, Faculty Senate. I would like to comment on latest version of NSHE’s Performance Pool Model (version16), specifically with regard to the Nevada universities, that is, UNR and UNLV. First, I suggest that the new model, which now includes a 20% weight for research expenditures, is a step in the right direction. Rewarding research productivity is essential to ensuring that our universities remain centers of learning excellence. Nonetheless, I am disappointed that this new model does not include direct incentives for institutions to become more efficient at graduating their students. Without such
incentives, we will be doing a disservice to our students and also to our institutions of higher learning.

As you may know, student loan debt has replaced auto loan debt and credit card debt as the top source of debt in the nation. The total outstanding student loan debt now stands at a staggering $870 billion. For all borrowers across the nation, the average student debt is $23,000. In this regard, it is important to point out that the longer a student pursues a degree, the greater the debt accrued. That is, there’s a strong relationship between the years to completion and the accumulated debt. Moreover, students who fail to graduate accrue large amounts of debt without any of the considerable economic benefits of obtaining a BS or BA degree.

In Nevada, we cannot just reward institutions for the number of graduates. We also must incentivize our institutions to become better at the efficiency with which we graduate our students. Right now, 14% of students at UNR and UNLV complete their degrees in four years. The six-year graduate rates, about 40% at UNLV, and approximately 53% at UNR, are much better but still are not nearly high enough by national standards. 

To address this problem, we need to include six-year graduation rates in the NSHE Performance Pool component of the new Funding Formula. As a starting point in the discussion, I propose that a 10% weight be applied to six-year graduation rate in the current “University Performance Outcomes and Points” model. To compensate for including this new metric, the weights for number of Bachelor’s degrees and Master’s and Doctoral Degrees should each be reduced by 5%, to 35% and 15%, respectively.

Nevada recently received a failing grade for the “student access and success” component of the recently published “Leaders & Laggards: A State-by-State Report Card on Public Postsecondary Education” by the U.S. Chamber of Commerce (http://icw.uschamber.com/reportcard/nevada/). A major factor in determining Nevada’s “F” grade was “The four-year institutions rank in the bottom 10 states in terms of completion rate …” While graduation rate is not a panacea for student success, it is a national and international benchmark by which universities are ranked. Increasing graduation rate at NSHE’s universities will lower the debt burden on our students, improve the rankings of our universities, and attract businesses to the state seeking a well-educated work force.

 

P.S. Tennessee has recently adopted six-year graduation rate as a significant component of their funding formula for higher education (http://www.state.tn.us/thec/) and it is likely that other states will be following Tennessee’s lead.

Thank you,

David W. Zeh
Professor
Chair, Department of Biology
Chair, Faculty Senate
University of Nevada, Reno
Reno, NV 89557
Tel: (775) 682 5735
Fax: (775) 784-1302
email: zehd@unr.edu

More information regarding this Legislative subcommittee can be found at the following link:
Funding of Higher Education’s Funding Formula Subcommittee