A proposed performance-based funding model for Iowa's three public universities could have a negative financial impact among schools in the state and hurt funding for some graduate programs, state lawmakers said Monday during a committee meeting.
Board of Regents President Bruce Rastetter told the House appropriations committee that the funding model, which regents approved last year, would help balance funding distribution between Iowa State University, the University of Iowa and the University of Northern Iowa. He said the current funding model is dated and not sustainable.
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The proposed model bases 60 percent of nearly $500 million in state funding allocation for the schools on the enrollment of in-state students. The rest would be based on performance measures such as the number of degrees awarded and access provided to low-income and minority students. It would be enacted over three years beginning in 2016.
Rep. Mary Masher, D-Iowa City, said the model could have a negative impact on private colleges and community colleges competing for in-state students.
"Many of them have a very small margin and if they lose some of the Iowa in-state students, they are in jeopardy of closing," she said. "As legislators, we have to look at all of higher ed, not just the regents, when we make decisions like this."
The funding would have the most impact on the University of Iowa, which currently receives more than 46 percent of the allocated funding. Rep. Cindy Winckler, D-Davenport, attended the meeting but is not on the committee. She questioned whether the funding model considers the costs between students enrolled in different programs like graduate programs.
Rastetter argued the regents are not directing money away from graduate programs.
Legislative lawmakers must approve Gov. Terry Branstad's budget proposal for the funding model to be officially applied. Rastetter said if the budget is approved, any issues with the funding model could be revisited yearly.