New state funding formula for Oregon community colleges will weigh underserved group enrollment, success

By Meerah Powell (OPB)
June 9, 2023 12:09 a.m.

The formula, approved by the higher education coordinating commission, is projected to result in slight changes in funding distribution for all community colleges

Higher education leaders in Oregon have redesigned the way the state distributes money to community colleges, putting a more intentional focus on improving outcomes for students from underserved populations.

The Oregon Higher Education Coordinating Commission Thursday approved a redesign of the funding formula it uses to administer state money to Oregon’s community colleges, following a review process that began early last year.


“For the first time, we are strategically dedicating a proportion of taxpayer funding to improving student success at Oregon’s 17 community colleges, while continuing the foundational funding that is focused on getting students in the door and supporting the incredible programs these colleges offer,” Ben Cannon, executive director of the Higher Education Coordinating Commission, said in a statement.

Previous to this redesign, state money was distributed to the colleges mainly by considering full-time equivalent student enrollment at each school, along with small base payments that supported basic operations at each institution.

Related: Audit: Struggling community colleges need more attention

Though enrollment will still be the major factor in funding distribution, up to 10% in state funding will be distributed to the colleges by weighing the number of underserved students they enroll and by looking at student outcomes, such as the completion of a certain number of credits, completion of specific courses and earning credentials.

The “prioritized populations” the commission is considering as part of those underserved student populations include people who come from low-income households, people who are 25 years of age or older, students in career technical education or workforce training programs and students of color.

“We hope focusing part of the funding toward student success will further accelerate and support equity and student success efforts at the colleges,” Karen Smith, interim executive director of the Oregon Community College Association, said in a statement.


Related: Oregon higher education officials urge lawmakers to dig beyond data to bridge barriers facing college students

The Higher Education Coordinating Commission gathered a workgroup to discuss the changes in March 2022. The workgroup was made up of community college administrators, faculty and staff, as well as statewide higher education leaders from the commission and the Oregon Community College Association.

“Community colleges exist to provide equitable access to higher education in our communities,” Mt. Hood Community College President Lisa Skari, who was on the workgroup, said in a statement. “The new model provides clarity and transparency as to how we align with state goals and focus on the success of our students, while also acknowledging these desired results require financial investments.”

The new formula will result in slight changes in funding distribution for all community colleges. According to projections from the higher ed commission, most colleges will likely see less than a percentage point increase or decrease in the usual distribution of money they get from the state.

Although the changes will likely not take effect until next year, the commission looked at how the new formula would change proposed funding for the current biennium, though that’s not yet solidified as it has not been approved in the state legislature.

Under the new formula, Umpqua Community College would see the biggest bump in funding — a projected nearly $240,000, or 1.6% increase — if the formula were to go into effect this year using the governor’s recommended budget.

Portland Community College, Oregon’s largest college, would see the largest decrease in funding distribution — a loss of more than $240,000, though that’s just a 0.2% decrease.

Eric Blumenthal, PCC’s executive vice president of administration and finance, said PCC worked with the Higher Education Coordinating Commission and other community colleges to develop the changes to the funding model.

He said the college supports the review of the model that led to the changes and the goal of improving success for underserved students, but he hopes the state also pays attention to the colleges that will likely be getting less money because of the new formula.

“The hope is that the state will include increased investments to community colleges to help offset any impact as PCC transitions to the new funding distribution model,” Blumenthal told OPB. “PCC strongly advocates for one-time funding to help with this transition.”


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