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Louisiana Higher Education Funding Formula Review

Summary

In 2024, the Louisiana Board of Regents (BOR) contracted NCHEMS to assist in reviewing the state’s funding formula with the BOR-assembled advisory committee charged with conducting the review. The Louisiana Board of Regents regularly conducts a review every five years of the state’s higher education funding formula. The review aims to ensure the funding model aligns with the Higher Education Master Plan and supports the goal of 60% of all working-age adults in Louisiana holding a degree or high-value credential by 2030.

The committee included system leaders, appointed institutional representatives, and BOR staff. NCHEMS participated in each of the committee’s meetings providing national context, recent research, and expert advice. From these meetings, NCHEMS developed a report detailing the process and recommendations from the committee. The proposed formula has the potential to be an innovative model that aligns with the state’s workforce objectives and could serve as an example for other states exploring similar policy goals.

Topics Approach Impacts Resources

Topics

During the review of the Louisiana higher education funding formula, NCHEMS advised on several topics including:

  • How to effectively align the state’s funding approach with the BOR strategic plan.
  • How to simplify the funding approach, while still providing an equitable, predictable model that supports effective institutional planning.
  • How to leverage state funding to support student and institutional success.

Approach

The Louisiana Board of Regents (BOR) assembled an advisory committee to oversee its funding model review. The group included system Chief Financial Officers, Academic Officers, system-appointed institutional representatives, and BOR staff. NCHEMS participated in every meeting and provided national context, recent research, expert advice, and a summary report of the committee’s proposed changes. The examination process provided an opportunity to make necessary technical changes and adjustments to the formula. This review of the model represents the third time the BOR has assessed the funding formula since the legislature enacted outcomes-based funding in 2014 and implemented it in the fiscal year 2016-2017.

Impacts

The Louisiana higher education funding formula stands out compared to the models used in other states. It is a hybrid formula incorporating base, cost, and outcome components. The state’s formula also includes various forward-thinking outcome metrics and weights to allocate funding. The Louisiana model effectively serves as a reference for other states exploring similar approaches. The NCHEMS report details key features of the Louisiana model and the policy alternative evaluated by the Board’s advisory committee. The report serves as a valuable resource not only for Louisiana, but also for other states considering similar policies.

Resources

Photo of PDF of the one-page summary of the formula changes for Louisiana titled, "Louisiana Board of Regents Funding Model Review: Incentivizing the Full Pathway to Completion." The image has several text boxes and is linked to the accessible PDF.       Photo of PDF of the back page of the one-page summary of the formula changes for Louisiana titled, "Louisiana Board of Regents Funding Model Review: Incentivizing the Full Pathway to Completion." The image has several text boxes and is linked to the accessible PDF.