New commission will explore higher-ed finance models

Bipartisan panel will explore finance models that promote innovation, expand capacity to serve all students.

finance-HEDIncreasing pressure on state budgets, along with changing student demographics and new academic models arising from advances in teaching and learning, create both opportunities and challenges for American higher education.

However, without creative new funding policies that expand access to meaningful educational opportunities beyond high school, including increased access made possible by wise use of existing public funds and by partnerships that generate greater private investment, the nation could fall short of the educated population it needs.

To address the need for innovative new ideas, the University of Virginia’s Miller Center has announced the creation of a nonpartisan National Commission on Financing 21st Century Higher Education.

(Next page: 4 potential areas with promise for higher-ed funding)

With support from Lumina Foundation, the commission will initiate blue-sky thinking to develop policy proposals aimed at providing long-term sustainable finance models for U.S. higher education. The commission will foster a new national dialogue as it works toward a consensus on new policies that have the potential to help the nation meet educational attainment goals. During its deliberations, the commission will explore how public and private dollars can clear the way for innovation, ensure fair educational outcomes for all students, and affordably educate enough people to reach attainment goals.

By commissioning outside nonpartisan research and analyses, the Miller Center’s group will identify creative and practical solutions involving public funding and private capital. Each policy option will be examined for its ability to expand the capacity of states to increase the percentages of residents with high-quality postsecondary credentials.

The 14-member commission convenes its first meeting on March 31 in Washington, D.C. One of the first tasks will be to identify policy and technical analyses needed to help the panel make its recommendations. The commission will rely on outside authors to write policy papers that will provide a foundation for the panel’s ultimate report of findings, conclusions and recommendations. The panel will emphasize potential finance models that are suited to the fiscal climate and can accelerate growth in attainment among students from all backgrounds.

Potential topics for study include:

• What is the 10-year outlook for state support of higher education across the nation? What is the future of finance as a public policy tool for influencing the direction of higher education?

• How do differences in state tax capacity and tax choices affect a state’s level of support for higher education? What are the implications, particularly for underserved students?

• What are some alternative financing approaches (public, private, hybrid) for making affordable, high-quality education more widely available?

• What can we learn from higher education finance models used in other nations?

“Thomas Jefferson — the first American president to found a university — felt that individuals ‘endowed with genius and virtue’ should receive an education ‘without regard for wealth, birth, or other accidental condition or circumstance.’ Jefferson’s mission has come to a major obstacle. State support for public higher ed and federal support for student aid both face real limits, so many deserving students are finding it harder to pursue their own educational journeys without running out of financial resources. The commission aims to do something about that,” said William Antholis, director and CEO of the Miller Center.

“The United States is facing critical questions about how it will cover the expense of educating enough Americans to meet the talent needs of our society,” said Jamie Merisotis, president and CEO of Lumina Foundation. “Our broader higher education finance discussions are stuck. This commission will highlight ideas that could reframe the dialogue and create urgency around the need to rethink how taxpayers support higher education and the positive role that private investment can play.”

The commission will be led by two former governors and will include other state leaders who have experience working with budgets, presidents of several colleges and universities, and CEOs of some of America’s largest companies. Members are:

• Governor Mike Castle, Former Governor of Delaware and U.S. Congressman (Co-Chair)
• Governor Bob Graham, Former Governor of Florida and U.S. Senator (Co-Chair)
• Andrea Ayers, President and CEO of Convergys
• Jorge Benitez, Retired CEO, United States and Senior Managing Director, North America for Accenture
• Carl Camden, President and CEO of Kelly Services, Inc.
• Juliet V. García, Executive Director of The University of Texas Americas Institute, formerly President of the University of Texas at Brownsville
• Mildred García, President of California State University, Fullerton
• Bernadette Gray-Little, Chancellor of the University of Kansas
• Indiana State Sen. Luke Kenley, Chairman, Appropriations Committee
• Maryland State Sen. Richard S. Madaleno Jr., Vice-Chair, Budget and Tax Committee
• Gail O. Mellow, President of LaGuardia Community College
• David Nelms, Chairman and CEO of Discover Financial
• Edward B. Rust. Jr., Chairman and CEO of State Farm Insurance Companies
• Lou Anna K. Simon, President of Michigan State University

The project director is Raymond Scheppach, an economic fellow at the Miller Center and senior lecturer with U.Va.’s Batten School of Leadership and Public Policy. Scheppach is former executive director of the National Governors Association (NGA). Assisting him will be John Thomasian, former director of NGA’s Center for Best Practices, and Kristin Conklin, a founding partner at HCM Strategists and former NGA staffer.

Lumina Foundation is an independent, private foundation committed to increasing the proportion of Americans with high-quality degrees, certificates and other credentials to 60 percent by 2025. Lumina’s outcomes-based approach focuses on helping to design and build an accessible, responsive and accountable higher education system while fostering a national sense of urgency for action to achieve Goal 2025.

Material from a press release was used in this report.

Laura Ascione