Chancellor: Plan to reform Nevada’s college funding won’t benefit all

There will be winners and losers under higher education Chancellor Dan Klaich's effort to rewrite how the state's colleges and universities are funded, he told the system's governing Board of Regents on Friday.

They'll know which institutions fit into which category soon, he said.

Even so, Klaich promised he would not aim for a specific outcome, regardless of what the end result might be.

"That's your job," he told the regents.

"I will let the numbers go where they go," he said. "We'll lay the data on the table and we'll try to do it openly and honestly."

For years, Nevada's higher education insiders have been working to rewrite the formula used to divide up the tax money the state allocates to higher education between the seven institutions.

The old formula, in place for more than a decade, rewards more money to colleges and universities with growing enrollments. The new focus would reward graduation, rather than simply bodies in the seats.

The old system is also seen as confusing, as unfairly rewarding some institutions over others, and as taking tuition and fees raised at some institutions -- especially UNLV -- and giving it to others.

Klaich, working with the state's college and university presidents, has come up with a proposal to radically revamp the formula. It would be similar to those used in other states.

The basics are this: It would allow the institutions to keep all of the tuition and fees they raise, allocate money based on the relative cost of courses actually taught, and reward higher graduation rates.

The key is a matrix that assigns courses a relative cost, Klaich said. The matrix essentially ranks courses in several categories, from the least expensive to the most expensive. Basic courses such as English and history are the cheapest, while upper division science and engineering courses are the most expensive.

Funding would be based on a combination of the student credit hours completed in each course with the course's relative cost.

There would also be allowances made to accommodate the small, rural community colleges and the research missions of the universities.

Higher ed leaders hope to have the new formula in place by September, when the system's budget request for the next fiscal year is due to the governor's office.

If the Legislature and the governor approve the new formula, it would be used for the system's next two-year budget. It would be phased in, however, over the course of two, two-year budget cycles so it is not a shock to the system.

The missing piece, so far, is how maintenance and operations funding would be distributed. Klaich said he hopes to have agreement on that topic in the next few weeks.

"We're still wrestling with that one," he told the Board.

He said he expects to have the basics figured out enough some time this month to be able to run budget scenarios, which would let everyone know how each of the colleges and universities might fare under the new plan.

Several regents questioned some of Klaich's assumptions. Cedric Crear repeatedly asked about funding and the cost of courses. An English 101 course, for example, would receive the same amount of funding at a university as it would at a community college. Crear wanted to know why.

Klaich answered that the data used to determine the relative cost of courses was from long-term studies done in other states. He said he did not want to go down the "rabbit hole" of trying to figure out the exact cost of each course in Nevada.

Several regents also said they favored a system where local governments contributed to the funding of the community colleges, a common practice in many states.

Klaich has pursued that in the past, but failed.

Regent Andrea Anderson, a former Boulder City city councilwoman, said she has talked to local officials, and they hate the idea.

"They don't even want to talk about it," she said.

Contact reporter Richard Lake at rlake@reviewjournal.com or 702-383-0307.