HIGHER EDUCATION New ‘historic’ state law to reward community colleges for performance
2023 EDUCATION EDITION
REVERSING THE TREND Since 1980, the state’s contribution to Texas’ 50 community colleges has been steadily declining, causing the institutions to rely more on property taxes and tuition. O cials are hopeful a new law passed in the 88th Legislature this year will provide a path to more state funding to meet workforce needs. Revenue breakdown of Texas community colleges over time
BY JAMES T. NORMAN
Chancellor Stephen Head said. LSC has eight colleges in the North Houston area, according to its website. As part of the Texas Commission on Community College Finance tasked with helping bring the bill forward, Head said for a long time he’s told state o cials the old system was not sustainable. “Community college nancing has been at issue for more than a decade,” Head said. Along with not aligning everyone’s goals in a cohesive direction, the old formula often punished smaller colleges—a system Head described as creating “haves and have-nots.” For example, many rural areas are losing their population to larger metro areas, Head said. That makes it di cult for smaller colleges in those places to keep their operations going as enrollment drops. And sometimes, due to the state having a xed amount of funds
Houston-area community college leaders are describing a new state law that transforms how their colleges receive funding from Texas as “groundbreaking” and “historic.” House Bill 8 will invest $683 million into the state’s community colleges and incentivize them to help students earn more credits and certi cation in high-demand elds. The bill will also incentivize colleges to help students transfer to four-year universities and provide more funding to them for high schoolers who complete dual- credit courses through their institu- tion, higher education o cials said. It’s a shift away from the old model, which gives colleges money based on their enrollment and the number of hours they are in contact with students, o cials said. “This is the most groundbreaking legislation I’ve seen,” Alvin Commu- nity College President Robert Exley
Property taxes Tuition
State
100% 80% 60% 40% 20% 0%
1980 1985 1990 1995 2000 2005 2010 2015 2020
Jobs requiring middle skills or certi cation in Gulf Coast region
Number of positions in 2020 Projected additional positions in 2030
47,000 9,000
Heavy-truck drivers Medical assistants Licensed practical & vocational nurses Heating, ventilating, air conditioning & refrigeration installers Preschool teachers
17,000
5,000
13,000
2,000
1,000 8,000 7,000 2,000
SOURCES: GULF COAST WORKFORCE BOARD, TEXAS 2036 COMMUNITY IMPACT
said. “It goes right to the heart of our mission.” The bill was signed into law by Gov. Greg Abbott earlier in June and received majority support, said Renzo Soto, policy adviser at Texas 2036, a nonpartisan public policy think tank. “I have not seen a signi cant education reform package not only pass, but also
every biennium, even when those colleges do have increases in enroll- ment, it’s still pro- portionately lower than the increases larger colleges see, resulting in lost revenue, Soto said. The new model Beyond just helping all commu- nity colleges in Texas nd sus- tainable revenue, the goal of the new law is to drive more students into high-demand jobs.
“I HAVE NOT SEEN A SIGNIFICANT EDUCATION REFORM PACKAGE NOT ONLY PASS, BUT ALSO MOVE THROUGH THE PROCESS, WITH THIS LEVEL OF UNIFIED SUPPORT.” RENZO SOTO, POLICY ADVISER AT TEXAS 2036
system to this degree are given years to implement, Zamora said. However, this new funding system will go into e ect in September—right at the start of the fall semester. As a result, colleges and the state are scrambling to set up their budgets, which go into e ect the same day, while an emergency rules session is ongoing for the bill to lay out its parameters, said Zamora, who is part of that committee. The emergency rules will be issued in July and approved in August, Soto said. Those rules will be in e ect for one year and will be followed up with a more permanent set. Those are expected to be more thorough and go through a more rigorous process that includes public hearings. Zamora said there is a bit of stress going into the new year, but it’s tempered by the expectation the new system will improve nancials and outcomes. The next year will also show what the rules could be. “The speed at which we’ve had to implement this has been challenging,” she said. “But I think everyone is cognizant that this is a great new direction.”
and vocational nurses. “The state is going to nd a way that noncredit education can be credit that stacks,” Soto said. “It’s all for the bene t of students.” Some of those jobs are high in demand, particularly in Houston, according to data from the Gulf Coast Workforce Board. Statewide, nurses and educators are needed as well. While community colleges in Houston and around the state are expecting funding to increase as a result of the law, many of those details still need to be worked out, Zamora said. However, thanks to a new in ux of money of $683 million paired with the bill, many colleges will receive a revenue boost for the 2023-24 school year to help deal with the transition, said Marshall Heins, chief nancial o cer and senior vice chancellor of nance and administration for Houston Community College. At ACC, the hope is the bill could add about $4 million per biennium to the college’s funds, Exley said. What comes next Typically, laws that overhaul a
move through the process, with this level of uni ed support,” Soto said. The goal is to help train Texas’ workforce to take high-demand jobs that require less than a bachelor’s degree but more than a high school diploma, Soto said. The old model HB 8 represents the rst time the funding model for community colleges in Texas has been signi cantly updated in 50 years, Lone Star College
For many colleges, such as San Jacinto College, the mission will remain intact, albeit more supported at the state level, Vice Chancellor for Fiscal A airs Teri Zamora said. The law also has a newly placed emphasis on noncredit paths, Soto said. Those are paths that require cer- ti cation but are not standardized in the same way other degree programs might be, such as for truck drivers, electricians, and licensed practical
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SUGAR LAND MISSOURI CITY EDITION • AUGUST 2023
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