Governor Susana Martinez met with regents, governing board members and post-secondary institution presidents yesterday, to unveil the new funding formula for higher education. Currently, some higher education funding allocations are made based on the size of the institution. Other funding is allocated based on the number of courses and degree programs started. The Governor plans to change that and tie more funding to student performance.

Going forward funding will be allocated past on the number of courses and degree programs completed. Institutions will also receive funds for graduating students in high-demand fields such as science, technology, engineering, health and mathematics.

“For the first time in the history of New Mexico, the younger generation is less educated than the generations before,” said Higher Education Secretary Jose Garcia. This is he result of funding allocations that incentivized higher education to build new buildings to gain more money instead of focusing on educational programs. Higher education institutions in the state have agreed to stop all new building for two years while they examine the formula changes.

The Governor will also be allocating $5.5 million to K-12 education according to a new A-F performance grading system for schools. Each school will be graded on the new system and funding awards will to to the highest performing schools. Schools will get their first round of grades this week.

Schools with the lowest grades D’s or F’s will also receive funding on an improvement oriented basis. Up to $3.4 million of the $5.5 million allocation has already been set aside for those schools. The money will go to attracting better teachers and paying for facilities improvements. High performing schools may win awards of up to $50,000 to support their efforts.

The Governor is allowing the application to go forward as part of his focus on education. However, he has stated that if the funds come with any additional requirements or includes too much federal involvement he will reject the funds. The state is eligible for up to $100 million under the program.

Governor Scott has made education the central focus of his administration but has had harsh criticism for the Race to the Top program. Only four states are eligible for the program and Florida is one of them. If approved for funds the state plans to use the money for early education programs for high-risk children. Scott wants the funds to be a one-time influx of cash that will be broken up into smaller awards spread statewide.

Florida’s application insists on a one time funding boost and explicitly states that the state will reject any longer term program requirements. The state will also reject the funds if the tax payer burden is deemed to be too high or if any restrictions against private business are included.

The state expects that the new law will add 2,500 students to the pool of eligible applications for Cal-Grants, this addition amounts to 1% of all available aid in the $1.4 billion program. The law overturns a veto of the same bill by former Governor Schwarzenegger.

The passage of this bill in California is a significant move as a similar bill is being considered at the federal level. Under the federal bill, high school students would be eligible for discounted in-state tuition rates and limited student visas to attend college. Tens of thousands of students in the United States have been brought into the country illegally by their parents and are currently attending school in the K-12 grades.

“Going to college is a dream that promises intellectual excitement and creative thinking. The Dream Act benefits us all by giving top students a chance to improve their lives and the lives of all of us,” Brown said.

New York City and the United Federation of Teachers have been fighting to keep the evaluations of its 12,000 teachers private, but earlier this year the State Supreme Court ruled that ratings must be made available. This decision was appealed and upheld by the New York Court of Appeals last month. The rulings have created a precedent for other districts across the state and may even establish a set of practices for other districts nationwide.

The ruling says that value-added ratings for teachers based on students’ standardized test scores must be released. The United Federation of Teachers claims that releasing these ratings is a violation of the personal privacy of teachers. However, supporters of the ruling and the courts have determined that as public employees, teachers are allowed afforded less privacy under the law.

The ruling notes that the public has a significant interest in knowing the overall performance of public school teachers. But, district offices say that providing this information presents a significant challenge, specifically the administrative cost tied up in separating sensitive information from the ratings, and providing ratings while all districts are still coming online in the evaluation process.

Several states are working on piloting new teacher evaluation systems and reconciling the information contained in them with freedom of information requirements. Appeals to overturn the ruling are expected to continue in New York and opponents are already working on asking for two years of data to be complete for comparison before releasing evaluations as an alternative option.

Recently, I’ve been traveling to various states to meet with gubernatorial candidates, new governors and their staffs. In the course of these discussions, several of the governors identified the link between higher education performance and their states’ success in creating the workforce of the future. States will be less able to retain major employers or attract new employers if they are not equipping students with the skills necessary to be successful in the workforce.

At Deloitte, we also recognize this challenge, if for no other reason than our own significant human capital needs. That is one of the reasons why we have selected education as the foundation for our corporate social responsibility program. I’m particularly proud of the relationship we have with the College Summit, which is focused on encouraging and equipping inner city students to get into college, and to be successful once they are enrolled.

Additionally, the Canadian member firm of Deloitte Touche Tohmatsu Limited recently released a major study on higher education performance titled “Making the Grade: A Study of the Top 10 Issues Facing Higher Education Institutions.”

Those 10 issues impacting higher education are:

• As funding declines, cost management is key
• Competition to attract the best students is heating up
• It is important to set priorities carefully
• Higher education technology upgrades are essential
• A renewed focus on resource optimization is required
• Education programs need to be linked to outcomes
• It is vital to attract and retain talented faculty
• Enhancing environmental performance is a priority
• Tackling diversity, accessibility, and affordability is important
• Addressing new responsibilities requires better disclosure and transparency

You can see the study in its entirety here.

As always, I look forward to your comments.

Mr. Robert N. Campbell III is Vice Chairman, Principal, Deloitte LLP and is the U.S. State Government Leader, based in Austin, TX

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Since taking office, Governor Rick Scott has openly and loudly rejected federal grant programs in his state, even going so far as to re-allocate the way stimulus funds approved before his tenure are being managed in the state budget. The Governor made news earlier this year for rejecting high-speed rail funds along with sending back money for child welfare visits. Scott says those moves were justified as is his Race to the Top application because it is a one-time influx of cash – a reversal of his previous position on single use funding.

However, even applying might not be so easy. When the state rejected funds for child welfare visits they became ineligible to apply for Race to the Top grants. In order to apply, they’d have to reverse course and accept the child welfare funds and then apply for Race to the Top. Both items would have to be approved by the conservative budget committee which sides with Scott on rejecting federal funding.

The budget committee opposes the child welfare grants because they are tied to federal health care reform. Florida is part of the group of states currently challenging the constitutionality of federal health care reform and the committee has so far rejected anything from the federal government that is tied to the bill. Early indications from the committee are that they have no intention of approving the funds regardless of the need for Race to the Top.

Florida’s Race to the Top application focuses on early childhood education programs. Florida has previously applied for and won Race to the top funding to reform its public schools.

The group is targeting start-ups in sectors such as tech, energy and health care which rely on ready access to high-speed broadband in order to do business. The schools also hope that by creating this infrastructure they’ll be able to foster cooperative relationships between local businesses, researchers, students and the universities themselves.

Gig.U is the brainchild of the Aspen Institute and has so far partnered with several major research universities including, Duke University, George Mason University, Virginia Tech and Case Western Reserve University. The group is also encouraging other schools to set up their own networks in the same fashion.

Gig.U is also notable in that it intends to reach out to broadband providers, university endowments and other private sources for their funding instead of relying on government funds. Gig.U organizers say that they started the network as a means of providing research universities with the high-speed access necessary to continue doing their work.

According to the Gig.U website, “the networks our leading university communities depend on do not provide the necessary advanced connectivity. Nor does the current market plan to upgrade the networks sufficiently to retain our leadership.” So, the group intends to build these networks on their own.

The group is expected to issue its first RFI within the next three months and will be looking for vendors to work on the networks.

Under the terms of the law, schools must now develop local, rigorous annual teacher evaluations that examine not only professional development but student achievement and growth in student learning. Seniority and academic degrees will now only count for one-third of consideration criteria in hiring and performance. Schools will also be able to reward teachers based on performance at the end of their evaluation process.

In addition to new evaluations, parents will also have more involvement in who teaches their children. According to the bill, if a teacher is rated ineffective for two years straight parents must approve of them teaching their children. Parents will also be more accountable for attendance, as the measure gives schools enhanced authority to pursue action against parents whose children are truant. Finally, the bill requires the Department of Education to partner with businesses and organizations to increase operational efficiency.

This week, Governor Daniels is expected to sign the remaining pieces of his education reform package, including a bill that will expand charter school opportunities, provide parents with more school choice, and a measure that provides postsecondary scholarships to Hoosier seniors who graduate from high school early.

“Among all the things we can do to make more successful the children of this state, nothing comes close to a better teacher. We are so glad that Indiana has leaped to the forefront by saying to people of all backgrounds and all walks of life, ‘come and teach,’” Daniels said, surrounded by Hoosier teachers from such organizations as Stand for Children, Students First and Teach for America.

238 high schools in Michigan have zero students that are prepared for college according to the 2010 ACT test and less than half of Michigan’s students are proficient in writing. In his statement, the Governor said that these statistics show that the state is not getting a satisfactory “return on investment,” for its educational spending and must find new options for helping students achieve. To this end Snyder is creating a new Michigan Office of the Great Start – Early Childhood in order to start working with children before they are of age to begin school.

The state will also launch a new dashboard called, “State of Education in Michigan,” which will show a report card of school performance statewide. Individual schools are also encouraged to make their own dashboards highlighting student performance data. This data will become the focus of another proposed measure which will tie a portion of state educational funding to performance and will also provide performance based bonuses to schools that excel.

The Governor is also advancing what he calls an “Any Time, Any Place, Any Way, Any Pace,” learning model in which funding follows a student rather than being exclusively tied to a school district. Schools will also be required to take out-of-district students if they have space available and caps on the number of charter schools in districts with failing schools will also be lifted.

“Providing open access to quality education without boundaries is essential,” Snyder said. “One of the complaints I hear most from teachers is that regulations prevent them from working with each students’ individual learning styles. It’s time we let schools focus on teaching and hold school districts accountable by measuring results.”

The bill was the result of the Teacher Hiring Task Force created in 2010. The measure establishes an ‘estimated unit count’ for the state’s school districts in April of each school year. School districts will then be guaranteed to receive funds for paying teachers in the following school year that are equal to 98% of the funds justified by the estimated unit count.

“This gives our districts more flexibility and makes it easier for them to secure great teachers earlier,” said Secretary of Education Lillian M. Lowery, who joined Markell for the signing.