NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

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(Parenthesis ( ) Indicate Revenue Decreases)

Relates to HB2

SOURCES OF INFORMATION

Commission on Higher Education (CHE)

SUMMARY

Synopsis of Bill

This bill appropriates $200.0 to the Commission on Higher Education for the purpose of implementing a review of the cost model of the higher education funding formula with the intent of accurately reflecting the delivery of instruction including the technology for extended learning.

Significant Issues

According to the CHE, the project proposed in this bill will update the formula factors related to instructional costs resulting from inflation and other initiatives. It is a three year project and the highest priority of the CHE.

FISCAL IMPLICATIONS

The appropriation of $200.0 contained in this bill is a recurring expense to the general fund. Any unexpended or unencumbered balance remaining at the end of FY00 shall revert to the general fund.

CONFLICT/DUPLICATION/COMPANIONSHIP/RELATIONSHIP

The LFC has recommended $183.0 for this project which appears in House Bill 2.

OTHER SUBSTANTIVE ISSUES

The CHE offers the following benefits of implementation:

• Updating the cost model will ensure equitable funding among higher education institutions;

    

    

• Updating the cost model will alleviate the need for non-formula adjustments at two-year institutions which currently receive them;

    

    

• The project will help the CHE to facilitate institutional efforts to promote efficiency and effectiveness;




    

• The project will allow the CHE to analyze the fiscal impact of technology and to explore funding options supporting institutional efforts to integrate technology into higher education programs designed for students of the 21^st century; and

    

    

• Once the project is implemented, the CHE will have the capacity to reassess costs on a regular basis.




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