State and university officials hashed over plans Thursday to change the funding model for state higher education.
In a closed-door meeting in Nashville, everything from giving the Tennessee Higher Education Commission more teeth to police university performance to offering incentives to faculty and staff for improving standards was discussed, officials said.
"I think there is widespread agreement on increasing incentives," said state Sen. Andy Berke, D-Chattanooga, a member of the group discussing higher education reform. "But there is always concern about maintaining (student) access and that the quality of the degree remains high."
Sen. Berke, a member of the Senate Education Committee, said 10 legislators were present at Thursday's meeting, along with the governor and chairmen of boards the University of Tennessee and the Tennessee Board of Regents.
A little more than 5 percent of college and university state support is based on their performance in areas such as graduation rates and graduation of specific types of majors. Legislators and Gov. Phil Bredesen are pushing for the percentage of incentive-based funding to be significantly larger and more tied to graduation rates.
"People work for incentives," Sen. Berke said. "Right now we give money based on how many people are in school 14 days into the semester. Institutions have learned that is what the state wants. We need to tell them that what we want is higher graduation rates."
The Tennessee Higher Education Commission, which had representatives at Thursday's meeting, is researching potential changes to higher education's current funding model. A formula review committee will present its results in January when the commission releases its new master plan, officials said.
The group that met today plans to research how new funding models will impact individual institutions and determine what expectations the state should have for each school, he said.
"If we are trying to raise the graduation rate at UTC, we shouldn't necessarily judge it against the University of Tennessee in Knoxville," said Sen. Berke. "We also understand that different demographics and different resources show different graduation outcome."
Richard Brown, vice chancellor for finance and operations at UTC, said the current funding model makes institutions want to grow their enrollment without looking closely at quality.
This year, the University of Tennessee at Chattanooga received $47.7 million in state appropriations, or 43.8 percent of its budget, documents show.
"I think it is a new day in Tennessee in terms of accountability," said Dr. Brown. "The goal here is to improve not only student access but student success - success being measured by graduation rates.
Dr. Brown said his only concern is that state officials ensure that new standards are equitable and fair.
"We will probably spend a lot of time improving our graduation and retention rates," he said.