Indiana higher ed commission lays out early plans for university funding, new career programs

Indiana’s Commission for Higher Education on Thursday outlined its plans for big changes to Indiana’s education landscape—some of which take effect in just a few weeks.

The goal is to increase the number of Hoosiers with post-high school credentials and boost the state’s dismal college-going rate.

State lawmakers put the commission on task during the 2023 legislative session, which ended last month. Included in a slew of signed bills are sweeping changes to high school curricula, new grants and scholarships to help Hoosiers access continuing education, and mandates for CHE to oversee new school accountability requirements.

“These are big pieces of legislation,” CHE Commissioner Chris Lowery said Thursday. “There’s consensus that we can do better. But on post-high school training and college-going rates and … higher learning for adults … we are really focusing on that.”

A new funding model for Hoosier colleges and universities

Key in Indiana’s next two-year budget are funding increases for the state’s higher education institutions—up 4% in the 2024 fiscal year and 6% in 2025 compared to appropriation levels in the last budget. That’s equal to $130 million in new money over the biennium.

But how much each state school gets will be determined by a new outcomes-based funding formula that is based on school-specific goals, rather than blanket recommendations.

At the heart of the current funding model, Indiana’s public higher education institutions are rewarded for growth, all based on the same five metrics. The model also uses averages over the last few recent years for various factors—such as on-time degree completion—to calculate the state’s fiscal responsibility moving forward.

CHE board members and state lawmakers agreed that Indiana should move away from that type of funding approach, and the new model will instead provide flexibility for institutions to work towards more individualized growth targets.

The goal is to make Indiana a top-10 state for enrollment in post-high school training and education for both youth and adults. The changes also intend to increase degree completions and overall graduate retention. Prospective funding for post-secondary institutions—meaning the additional funding a college or university can earn on top of its base funding—will be gauged by each school’s progress toward those goals.

So, if a college meets 80% of its degree completion goal, the school gets 80% of the additional funding it qualifies for. Whatever is earned in the first year of the biennium is guaranteed in the second, with the opportunity to earn the remaining 20% of extra dollars in year two.

But after Ivy Tech Community College spoke out against the new outcomes-based funding model late last year, the state’s largest public postsecondary institution will have its own formula.

Legislators carved out a separate funding plan in the state budget that allows Ivy Tech’s goals to continue to center on employer needs, as well as increased wage outcomes and stackable credentials for students.

The community college previously maintained that—under the funding model for all other higher education institutions—recent progress made by Ivy Tech wouldn’t be rewarded, which could mean millions of dollars were no longer guaranteed.

Lowery said the commission expects to approve the overarching post-secondary goals by June 1 so the plan can get necessary review from the State Budget Agency by July 1.

Spearheading work-based learning overhaul

Additionally among CHE’s tasks is putting in motion statewide career-centered education and training programs laid out in HEA 1002, a massive bill that at its core seeks to expand work-based learning in Indiana high schools, such as apprenticeships and internships.

The new framework is intended to enable students to earn a post-secondary credential before leaving the K-12 system.

The commission will help designate and approve new high school career courses, modern youth apprenticeships and other related programs. CHE will also approve postsecondary educational institutions, intermediaries, employers, and labor organizations and help students connect with those entities for new learning opportunities.

Further, CHE will take over Indiana’s Office of Career and Technical Education. The eight-person staff is currently under the Governor’s Workforce Cabinet and will join CHE July 1.

Lowery and CHE staff said their to-do list is long and will likely require more resources, including additional state funding for staff.

“Part of what we have to understand as we drive for better success of students is how well they’re prepared in K-12. How we integrate, how we blur the lines and so forth, is to anticipate a day when folks in these roles are not here,” he said. “And how can we make sure that we’re being intentional about this work so that we can set the table, if you will, and have that intentionality and the relationships and the preparation and the outcomes?”

Other bills to boost higher education

The commission highlighted multiple other bills affecting higher education matters, too.

Separate from higher education funding, the next state budget additionally appropriates $5 million to CHE over the biennium for grants to Martin University, the state’s only predominantly black institution. The school must use the grants to attract and retain students in high-demand professions.

The state spending plan also earmarks $5 million to the commission for the College Success Programs, which seeks to increase the success of minority, first generation, and low-income students. Four-year institutions are eligible to apply for program funding.

And at the K-12 level, new academic performance grants will go to school corporations that help steer students towards college degrees.

Schools will receive: $40 per dual credit earned by each student, $1,500 per student that completes the Indiana College Core, and $2,500 for every student that earns an associate’s degree while still in high school. CHE indicated that schools will only qualify for one performance award—at the highest threshold—for each student. For example, that means a school will only get the $2,500 grant for a student who earns both dual credit and an associate’s degree.

Here’s a look at other changes made during the legislative session:

SEA 167: FAFSA

Requires high school seniors—beginning with the Class of 2024—to complete the Free Application for Federal Student Aid. It includes two opt-out provisions. Parents or emancipated students can opt-out of filing on their own, or a high school can waive the requirement after April 15 if it has made two reasonable attempts to contact the student’s parent.

SEA 384: Purple Star Designation

Creates the Higher Education Purple Star Designation to provide veterans and military-connected families with additional support for pursuing a credential and finishing a degree. It also recognizes colleges and universities that are “supportive and inclusive” of veterans and their families.

SEA 404: Access to transcripts 

Requires Indiana’s public colleges and universities to provide a transcript to a student who owes debt if the student owes no more than $1,000, and the student has paid at least $100 the past year, or if the student owes more than $1,000 and has paid the lesser of 10% of the debt, or $300, in the past year.

HEA 1160: Workforce Development Pilot Programs

Allows CHE to establish an Education & Career Support Services Pilot Program. The program must provide college and career support services to adult students at public colleges and universities. This program did not receive funding in the upcoming biennium, however.

HEA 1449: 21st Century Scholars

Requires CHE to identify and enroll eligible students into the 21st Century Scholars program. The commission must notify families of their eligibility, and parents or guardians can opt their student out of the program. Auto-enrollment begins with the class of 2027.

HEA 1511: Military-based financial aid

Expands the use of the National Guard Tuition Supplement Grant and Educational Cost Exemptions to private, non-profit colleges and universities. The maximum award amount is capped at $5,000.

HEA 1528: Next Generation Scholarship

Expands the Next Generation Hoosier Educators Scholarship to students enrolled in approved transition to teach programs. The scholarship is a one-time $10,000 award. Each recipient must still agree to teach at a qualifying school for at least five years after earning a teaching license.

HEA 1637: Teacher Education Scholarship Programs

Increases the annual Next Generation Hoosier Educators Scholarship from $7,500 to $10,000 and removes the 200-recipient annual cap. The measure also creates a new Next Generation Hoosier Minority Educators Scholarship and increases the Earline S. Rogers Teaching Scholarship for Minority Students from $4,000 to $5,000. In total, the budget appropriates $25.4 million over the biennium for those scholarship programs.