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Indiana Commission for Higher Education proposes new funding model

By Ethan Sandweiss

Posted November 15, 2022

Ivy Tech has been successful under the current funding model, which prioritizes graduation rates. (WFIU/WTIU)

The Indiana Commission for Higher Education (ICHE) approved recommendations for a new higher education funding model Thursday that focuses on individualized growth.

While representatives from some colleges and universities praised the changes, Ivy Tech worries the new plan could cost it up to $12 million in annual funding. 

According to the ICHE, the new model will award schools for meeting individualized growth goals, as opposed to the current “legacy” model that focuses entirely on degree completion. 

Indiana Commissioner for Higher Education Chris Lowery said the current model pits Indiana’s seven primary public institutions against each other. By contrast, the new model will prioritize different criteria and draw from multiple funding pools. 

“This model will rely on new state support, so rather than a bucket of reallocated funds from the seven institutions, our recommendation going forward with this funding formula is for a new pool of money that those institutions can have as incentives,” Lowery said. 

Mary Jane Michalak, Vice President for Legal and Public Affairs at Ivy Tech, said she supports the ICHE’s individualized framework in principle but is concerned that unless the new metrics are made clear, the new proposal will hurt her college. 

“We have concerns because there is more money being placed on a model that does not yet have metrics defined, versus putting the money where the institutions have been focused on metrics for many, many years,” Michalak said. 

The current guidelines have been in place since the early 2000s. Increasing degree completion was the state’s main objective, and Ivy Tech rose to the challenge by issuing more certificates.  

A former vice president at Ivy Tech, Lowery said Indiana has been successful at improving completion rates and the ICHE wants to prioritize new objectives. 

“We're not going to be doing away with the completion focus, that's going to remain a focus for every institution,” Lowery said. But he thinks the state could do more to raise college attendance rates, provide training for adults without degrees and incentivize graduates to stay in Indiana. “Those are some things that we think are really key in helping to plug the holes in the leaky talent pipeline.” 

If the proposal passes, less funding will go toward completion-oriented goals and more will go toward growth by these other metrics. Michalak said Ivy Tech anticipates the funding it receives for meeting degree completion goals to go from $15 million annually to as low as $2.9 million. 

Ivy Tech’s fiscal year begins on July 1, but the final details of the plan may not by clear until two months earlier. “The General Assembly is supposed to adjourn by April 30, so it doesn't give us very much time to plan for the new metrics,” Michalak said. 

Lowery acknowledged the new framework is a work in progress. 

“We want this to be a model that by the time it's here it is in greater detail, we’ll have the support of all the institutions,” he said. “It’s really the first step in this process.” 

The state budget committee will consider the new funding model on Dec. 7, after which it will move to the Indiana House and Senate.  