Gov. Signs Higher Ed Reform Bill; Details, Cash Next Step

By Amanda Iacone, Virginia Statehouse News Monday, June 20, 2011

RICHMOND — A higher education bill signed last week by Gov. Bob McDonnell to reform the state’s universities is short on specifics, and university officials wonder if the Legislature will fund the plan.

University, business and government officials cheered the law’s goals, which will encourage more degrees in science, math and technology and will reward universities that operate more efficiently.

While the law lays out a blueprint for the state’s higher education system, it does not provide specific standards that universities will have to meet, nor does it specify the level of funding universities can expect.

Officials warned that it could take several years before all of the details are worked out.

McDonnell on Thursday ceremonially signed the bill into law, which sets a goal of graduating an additional 100,000 college students in the next 15 years and provides a one-time infusion of $100 million to the universities.

To add students, universities also must hire more faculty and provide more labs and equipment, said Linwood Rose, president of James Madison University, or JMU.

JMU likely will redistribute or reduce resources in administrative areas that don’t directly affect students to comply with the law, Rose said.

For example, he eliminated two vice-president positions. But the university wants to expand its nursing program and the school needs more classroom space to accommodate more students, Rose said.

“There is a cost with these initiatives,” Rose said. “We’re committed to expanding and improving access for Virginians and to lowering the marginal cost of instructional delivery while maintaining or enhancing instructional quality. We support accountability … However I think the old adage ‘you get what you pay for’ still rings true. Lower marginal cost doesn’t mean cheap. Excellence has a price.”

The law resulted from a report that called for more focus on science, math and technology degrees to ensure a qualified workforce to meet today’s business needs. The report also called for measuring universities’ performance, providing additional funding and setting a base rate of funding for each university that would be updated periodically.

State Sen. Edd Houck, D-Spotsylvania, said the landmark legislation is as significant as the creation of the state’s community college system.

But state Delegate Kirk Cox, R-Colonial Heights, cautioned that much remains to be done.

“This is the beginning. It sets the course. It sets the framework. It sets up the funding and planning. And like any other major initiative, it will take several years to get fully in place,” Cox said.

An advisory committee to the governor will have to decide how state funding will follow students attending public or private schools.

The committee also must determine what families are considered middle income and who would be eligible for new financial aid that the state has made available, Cox said.

The council also will address how to measure the performance of the financial incentives and revise the performance standards the universities must meet. Baseline-funding formulas for each institution also must be set, Cox said.

How much additional funding will need to flow to the universities also remains unclear.

Any surplus dollars at the end of this year — the 2012 fiscal year begins July 1 — should go to elementary and high school education plus universities, Houck said.

McDonnell said the next biennial budget he will introduce in December will include university funding.

The six-year plans universities will file are expected to help determine additional, short-term funding, Rose said.

McDonnell said he wants a new baseline-funding formula, so it can include money in the two-year budget he’ll propose in December.

Despite recent cuts, 20 percent of the state budget goes toward higher education, and taxpayers are demanding accountability from the institutions, McDonnell said.

As part of the reform bill, the Legislature provided $100 million that will flow to the universities beginning in July as a down payment to make the goals in the bill a reality. Universities statewide will open an extra 6,000 spots to students enrolling this fall.

JMU will use the $6.5 million available in July to teach an extra 240 students compared with this past year. The university will add faculty and support its online courses and summer classes, Rose said.