By Tim Leeds
Commissioner of Higher Education Dr. Richard Crofts presented the formula currently used by his office to allocate state funds to the units of the state university system last Friday.
Crofts made his presentation from 2 to 4 p.m. at the Hagener Science Center on the Montana State University-Northern campus.
Crofts said this is an allocation model. It determines what proportion the state funded support for resident students will be distributed in, he said.
Crofts said the model has been designed to equitably allocate state funds based on campus needs determined through a formula rather than based on prior spending patterns.
He said before the campuses were divided into to the two-university system, funding tended to be based on who could successfully lobby for higher funding. This can cause inequitable funding, he said.
Crofts said the current model has been designed by investigating expenses and budgeting at peer institutions at the twelve states determined to be closest to Montana in ability to pay for higher learning. He said expenses in these institutions have been averaged, and are used to compute the theoretical expenses of programs at Montana.
The allocation model is based upon the formula used by New Mexico. He said part of the reason this system was chosen because New Mexico has similar higher education systems and structures resemble Montana's in many ways. Crofts said another reason is that the New Mexico allocation model is simpler than many other models being used.
Crofts said the allocation model is largely student driven. The amount of funds a campus will receive depends on how many resident students the campus has enrolled and how many credit-hours they are enrolled in, he said.
The characteristics of each campus will also affect the allocation, Crofts said. These characteristics include the institution's classification as far as what degrees it bestows, its array of programs, levels of instruction and size.
The allocation formula computes a target expense for instruction, academic support, student services, institutional support, physical plant, fee waivers, athletics, research and public service, and enrollment growth. Once all of these are computed, they are used to compute a target allocation for each campus.
The final formula has not been set for all of these expenses yet, Crofts said.
Crofts said it is important to remember this is a target allocation figure. He said the figures used are averaged from 12 other states, all of which spend more than Montana currently does on their university systems.
Since Montana's higher education budget is less, he said, the target allocation is used to compute the proportion at which the campuses are funded. All campus allocations are multiplied by the same percentage. This is determined by the percentage of the total target allocation the actual budget allows.
Crofts said that once tuition has been added to the state support for in-state students, the final spending amounts to approximately 75 percent of the average spent at peer institutions in the 12 comparable states.
Montana State Senator Greg Jergeson said he believes this allocation model benefits MSU-Northern more than many other possible allocation models would. Jergeson has attended other presentations of the allocation model by Crofts.
Crofts said the allocation model presented actually has nothing to do with the amount the legislature budgets towards higher education or how the campuses spend what is allocated. It is simply used to determine the proportions of the allocation, he said.
Crofts declined to comment on other issues, such as program review and program cuts, except as related to the allocation model.