States to Colleges: Prove You’re Worth It

New College of Florida doesn’t offer pre-professional degrees, like nursing or engineering. Students choose the public liberal arts college because they want an intellectual experience. Many take a year off after graduation to pursue research or community service.

Yet last fall, New College opened a flashy new career center on its Sarasota campus. It needed to prove to the state that it was helping students find jobs and graduate on time, or risk losing $1.1 million in state aid. “That’s a big deal for us,” David Gulliver, media relations coordinator for New College, said of the money.

This fiscal year, Florida was one of 26 states to fund their two- or four-year college systems (or both) partly based on outcomes such as graduation rates, according to HCM Strategists, a consulting firm. Mississippi, Nevada, North Dakota, Ohio and Tennessee all spent over half their higher education budgets that way.

The idea of using outcomes — not enrollments — to guide public funding of higher education has so much bipartisan backing that both President Barack Obama and Florida’s Republican Gov. Rick Scott support it. In July, the Florida Board of Education approved a performance-funding system for state colleges, adding to its existing system for state universities.

It’s too early to say whether performance-based funding will drive the changes lawmakers want. But the policy so aligns with national concerns about the cost and payoff of a college education that it’s likely here to stay.

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