(a) (1) The Division of Higher Education may promulgate rules to implement a productivity-based funding model for state-supported institutions of higher education, including without limitation two-year and four-year state-supported institutions of higher education.(2) The rules adopted to implement a productivity-based funding model for state-supported institutions of higher education shall contain measures for effectiveness, affordability, and efficiency that acknowledge the following priorities:(A) Differences in institutional missions;(B) Completion of students' educational goals;(C) Progression toward students' completion of programs of study;(D) Affordability through:(i) On-time completion of programs of study;(ii) Limiting the number of excess credits earned by students; and(iii) Efficient allocation of resources;(E) (i) Beginning in the 2026-2027 academic year, incorporation of a return on investment metric into the productivity-based funding model.(ii) The return on investment metric under subdivision (a)(2)(E)(i) of this section shall be defined by rule of the Division of Higher Education.(iii) The Division of Higher Education shall ensure that the return on investment metric required under subdivision (a)(2)(E)(i) of this section is aligned with state economic and workforce needs;(F) Institutional collaboration that encourages the successful transfer of students;(G) Success in serving underrepresented students; and(H) Production of students graduating with credentials that align with statewide and regional workforce needs.(3) (A) The Division of Higher Education may promulgate rules to implement a funding formula to support noncredit programs at a state-supported institution of higher education.(B) Funding for a noncredit program may come from the following:(i) General revenues authorized by law; and(ii) Any other funds as provided by law.(C) The Division of Higher Education shall consult with the Governor's Workforce Cabinet during development of the funding formula for the noncredit programs under subdivision (a)(3)(A) of this section.(4) The productivity-based funding model shall not determine the funding needs of special units such as a medical school, a division of agriculture, or system offices.
(1) The Division of Higher Education may promulgate rules to implement a productivity-based funding model for state-supported institutions of higher education, including without limitation two-year and four-year state-supported institutions of higher education.
(2) The rules adopted to implement a productivity-based funding model for state-supported institutions of higher education shall contain measures for effectiveness, affordability, and efficiency that acknowledge the following priorities:(A) Differences in institutional missions;(B) Completion of students' educational goals;(C) Progression toward students' completion of programs of study;(D) Affordability through:(i) On-time completion of programs of study;(ii) Limiting the number of excess credits earned by students; and(iii) Efficient allocation of resources;(E) (i) Beginning in the 2026-2027 academic year, incorporation of a return on investment metric into the productivity-based funding model.(ii) The return on investment metric under subdivision (a)(2)(E)(i) of this section shall be defined by rule of the Division of Higher Education.(iii) The Division of Higher Education shall ensure that the return on investment metric required under subdivision (a)(2)(E)(i) of this section is aligned with state economic and workforce needs;(F) Institutional collaboration that encourages the successful transfer of students;(G) Success in serving underrepresented students; and(H) Production of students graduating with credentials that align with statewide and regional workforce needs.
(A) Differences in institutional missions;
(B) Completion of students' educational goals;
(C) Progression toward students' completion of programs of study;
(D) Affordability through:(i) On-time completion of programs of study;(ii) Limiting the number of excess credits earned by students; and(iii) Efficient allocation of resources;
(i) On-time completion of programs of study;
(ii) Limiting the number of excess credits earned by students; and
(iii) Efficient allocation of resources;
(E) (i) Beginning in the 2026-2027 academic year, incorporation of a return on investment metric into the productivity-based funding model.(ii) The return on investment metric under subdivision (a)(2)(E)(i) of this section shall be defined by rule of the Division of Higher Education.(iii) The Division of Higher Education shall ensure that the return on investment metric required under subdivision (a)(2)(E)(i) of this section is aligned with state economic and workforce needs;
(i) Beginning in the 2026-2027 academic year, incorporation of a return on investment metric into the productivity-based funding model.
(ii) The return on investment metric under subdivision (a)(2)(E)(i) of this section shall be defined by rule of the Division of Higher Education.
(iii) The Division of Higher Education shall ensure that the return on investment metric required under subdivision (a)(2)(E)(i) of this section is aligned with state economic and workforce needs;
(F) Institutional collaboration that encourages the successful transfer of students;
(G) Success in serving underrepresented students; and
(H) Production of students graduating with credentials that align with statewide and regional workforce needs.
(3) (A) The Division of Higher Education may promulgate rules to implement a funding formula to support noncredit programs at a state-supported institution of higher education.(B) Funding for a noncredit program may come from the following:(i) General revenues authorized by law; and(ii) Any other funds as provided by law.(C) The Division of Higher Education shall consult with the Governor's Workforce Cabinet during development of the funding formula for the noncredit programs under subdivision (a)(3)(A) of this section.
(A) The Division of Higher Education may promulgate rules to implement a funding formula to support noncredit programs at a state-supported institution of higher education.
(B) Funding for a noncredit program may come from the following:(i) General revenues authorized by law; and(ii) Any other funds as provided by law.
(i) General revenues authorized by law; and
(ii) Any other funds as provided by law.
(C) The Division of Higher Education shall consult with the Governor's Workforce Cabinet during development of the funding formula for the noncredit programs under subdivision (a)(3)(A) of this section.
(4) The productivity-based funding model shall not determine the funding needs of special units such as a medical school, a division of agriculture, or system offices.
(b) The productivity-based funding model shall be:(1) Used to align institutional funding with statewide priorities for higher education by:(A) Encouraging programs and services focused on student success; and(B) Providing incentives for progress toward statewide goals; and(2) Built around a set of shared principles that:(A) Are embraced by state-supported institutions of higher education;(B) Employ appropriate productivity metrics; and(C) Are aligned with goals and objectives for postsecondary education attainment in this state.
(1) Used to align institutional funding with statewide priorities for higher education by:(A) Encouraging programs and services focused on student success; and(B) Providing incentives for progress toward statewide goals; and
(A) Encouraging programs and services focused on student success; and
(B) Providing incentives for progress toward statewide goals; and
(2) Built around a set of shared principles that:(A) Are embraced by state-supported institutions of higher education;(B) Employ appropriate productivity metrics; and(C) Are aligned with goals and objectives for postsecondary education attainment in this state.
(A) Are embraced by state-supported institutions of higher education;
(B) Employ appropriate productivity metrics; and
(C) Are aligned with goals and objectives for postsecondary education attainment in this state.
(c) (1) The Division of Higher Education shall use the productivity-based funding model as the mechanism for recommending funding for state-supported institutions of higher education.(2) The Division of Higher Education shall recommend funding for:(A) State-supported institutions of higher education as a whole; and(B) The allocation of funding to each state-supported institution of higher education.(3) The Division of Higher Education may make separate recommendations for:(A) Two-year state-supported institutions of higher education; and(B) Four-year state-supported institutions of higher education.
(1) The Division of Higher Education shall use the productivity-based funding model as the mechanism for recommending funding for state-supported institutions of higher education.
(2) The Division of Higher Education shall recommend funding for:(A) State-supported institutions of higher education as a whole; and(B) The allocation of funding to each state-supported institution of higher education.
(A) State-supported institutions of higher education as a whole; and
(B) The allocation of funding to each state-supported institution of higher education.
(3) The Division of Higher Education may make separate recommendations for:(A) Two-year state-supported institutions of higher education; and(B) Four-year state-supported institutions of higher education.
(A) Two-year state-supported institutions of higher education; and
(B) Four-year state-supported institutions of higher education.
(d) Funds unallocated to state-supported institutions of higher education due to productivity declines shall be reserved by the Division of Higher Education to address statewide needs in higher education.
(e) The Division of Higher Education shall review the policies every five (5) years to ensure the productivity-based funding model continues to respond to the needs and priorities of the state.
(f) In any fiscal year for which the aggregate general revenue funding forecast to be available for state-supported institutions of higher education is greater than two percent (2%) less than the amount provided for the immediate previous fiscal year, the Division of Higher Education shall not further implement the productivity-based funding model until the following fiscal year.