Dubuque leaders voice concern around regent funding model

DUBUQUE - City leaders have 'serious” concerns about a new method for funding Iowa's public universities that emphasizes recruitment of in-state students, and they want the Board of Regents to abandon the new model and 'reopen the discussion.”

Those concerns were listed among the city's 2015 legislative priorities, which were discussed Monday during the Dubuque City Council meeting and will be presented Tuesday to lawmakers at the annual legislative dinner.

'We think this new funding model will be a detriment to our workforce development efforts and will negatively impact all the community colleges and private colleges across the state,” said Dubuque City Manager Michael Van Milligen, who recommended the City Council ask lawmakers not to appropriate money according to the regents' new funding model.

'Reimbursement to regent institutions based upon admission of Iowa students is not good policy,” according to Van Milligen's recommendation.

The new model, which regents approved in June to begin using in the 2016 budget year, proposes distributing state dollars based on enrollment and performance metrics. Allocations previously were history-based, meaning funding for the University of Iowa, Iowa State University and University of Northern Iowa would increase or decrease annually by a percentage based on prior year allocations.

Under the new model, enrollment will account for 75 percent of state allocations - with 60 percent tied to resident enrollment, 5 percent to graduate and professional resident enrollment, and 10 percent to access, which is measured by enrollment of specific groups of students such as low-income, ethnic and veteran students.

Another 20 percent will be based on performance metrics, such as degree completion and research contributions. The remaining 5 percent is left to the board to decide.

Regents and supporters have said the funding model needs revising to more equitably distribute what has been a shrinking pool of state resources and to better support the education of Iowa students, who do not pay the full cost of their education in tuition like out-of-state students.

But, according to Van Milligen's recommendation, the model could have 'significant unintended negative consequences on other Iowa postsecondary educational institutions.” Namely, he said, private and community colleges, including those in and surrounding Dubuque.

'The proposed policy has already impacted regional community college with the result of declining enrollment,” Van Milligen said in his recommendation.

And, he warned, the funding model also could hamper the state's workforce development goals as the public universities - specifically the UI - pour more resources into recruiting Iowans or face losing tens of millions of dollars.

'Do we want to send a message that Iowa does not welcome out-of-state students?” he said.

Van Milligen said Iowa is facing a 'significant” shortage in skilled workers and a decline in Iowans of working age.

'This issue does not help in recruiting out-of-state students to be educated and hopefully work and start a family in Iowa,” he said.

It also could deter businesses from expanding in Iowa or choosing to come here, he said.

'The implication on economic development cannot be understated,” he said.

Regarding individual students, Van Milligen said, some Iowans who might have been better served at a community or private college now might be recruited to one of the larger institutions. Once there, they might struggle and eventually drop out, incurring debt without gain and possibly contributing to the shortage of skilled workers.

'They will be undereducated and most likely to be unable to pay off their college debt,” he said.

Dubuque council member Kevin Lynch said his concerns with the model include both workforce development and the economy.

'In Dubuque, we have three four-year colleges and a community college and other smaller ones in the area,” Lynch said. 'They are a huge part of our economy here, and the worst-case scenario is that you would see a few not able to sustain themselves.”

He expressed concern with ramping up competition among Iowa's higher education institutions.

'We see this happen so many times in Iowa that we keep on fighting among ourselves for the same small piece of the same small pie,” he said.

The Dubuque Area Chamber of Commerce also has misgivings about the new funding model, and it's planning to discuss it next week with chamber members in higher education and public and private partner organizations, chamber President Molly Grover said.

'We hope from this meeting to get information that would possibly lead to the board taking a position,” she said.

Once the chamber takes a position, Grover said, it typically launches a comprehensive campaign that communicates to members, elected officials and other partners 'as far and wide as possible to let people know our position.”

'It is common practice, once the chamber has a position, that we do an action alert and ask members to get involved,” Grover said.

The chamber's primary concerns with the regents' funding model relate to regional and statewide workforce development.

'This approach could be counterintuitive to our state's efforts to attract and retain a future workforce,” she said.

The Dubuque-area chamber board could take a position within the next month, and Grover said her chamber is not the only one weighing the issue.

Nancy Quellhorst, president of the Iowa City Area Chamber of Commerce, said board members for her chamber also have expressed serious concerns about the consequences of the model, and they're planning to take up the issue as part of their discussion of 2015 legislative priorities later this month.