Study Examines Massachusetts' Community College Funding Formula

Study Examines Massachusetts' Community College Funding Formula

The abandonment of a funding formula for Massachusetts' fifteen community colleges represents a missed opportunity to ensure that state funding is equitably allocated based on performance and enrollment data, a report from the Boston Foundation and the Massachusetts Taxpayers Foundation finds.

The report, Grade Incomplete: Implementation of the Community College Funding Formula in Massachusetts (40 pages, PDF), examines the partial implementation and gradual phase-out of a formula launched in 2013 that was designed to end decades of funding allocations based largely on previous years' allocations and political considerations, replacing it with a model through which each campus would be provided with an operating subsidy of $4.5 million and the remaining funds would be distributed based on enrollment and outcome metrics. Developed with feedback from community college leaders, the new formula was implemented in the state budget for FY2014 but was modified to apply to new budget funds only, with the aim of ensuring that no campus received less funding on a year-over-year basis. According to the report, the partial implementation of the formula, combined with what turned out to be a short-lived commitment to the model, limited its impact with respect to improving equity. Indeed, in each year of implementation, the amount of new funding allocated in line with the formula fell significantly, from $20 million in FY2014 to $2.6 million in FY2017, when the formula was discarded. 

In addition to the formula not being implemented as intended, the fact that it was never evaluated against funding goals and that public data on formula inputs and mechanics were limited made it difficult to demonstrate its equity benefits, while the fact that it was never codified into law made it vulnerable to changes in the state's fiscal circumstances and legislative and executive leadership.

The report offers five recommendations for creating a new formula: build on areas of past success by taking into consideration the needs of both policy makers and community colleges; set clear, consistent goals designed to define and contextualize funding requests and provide a standard for determining whether the system has lived up to its commitments; be realistic and include "hold-harmless" provisions to prevent campuses from losing funding during any transitional period; legislate the formula into state law; and make the details of the formula simple enough that interested parties can understand how dollars under the formula are distributed.

"The community college funding formula held great promise for distributing funds more rationally and with greater accountability, but we will never know if its intended results were achievable because the formula was not in place for a sufficient amount of time nor did it fully take hold as designed," said Eileen McAnneny, president of the Massachusetts Taxpayers Foundation. "However, the initial impact was quite promising, and in an age of tight budgets with fewer discretionary dollars available, it is worth reviving the formulaic approach to ensure taxpayer funds are well spent and educational outcomes are attained."