New Tool for State Higher Education Budgeting

Lincoln -- A superb new database is now available to show taxpayers how colleges and universities are performing their mission to provide access to higher education, especially to students who have trouble paying for it. Easy to use, the database offers many ways of measuring access and many ways of comparing institutions.

This should be a helpful tool for setting state appropriations for higher education. Institutions doing a good job could be rewarded, incentivizing others where there is room for improvement.

To demonstrate, look at this link for the University of Nebraska. Scroll down to "College by College" and select the column to compare it with other Nebraska institutions. Then look at the indicators and the rankings. NU looks very good on "chance a poor student has to become a rich adult," coming in second only to Creighton University. Conversely, NU does not make it into the top ten in the broader measure "overall mobility index," which looks at the likelihood a student moved up two or more income quartiles as a result of his or her education.

On the overall mobility index, here are the top ten Nebraska institutions:

1. Northeast Community College
2. Midland University
3. Mid-Plains Community College
4. Doane College
5. Western Nebraska Community College
6. Bellevue University
7. Wayne State College
8. Hastings College
9. Central Community College
10. Nebraska Wesleyan University

Note that the top college is a community college, as are four of the top ten, and that five of the top ten are private, non-profit colleges. Note only one is located in Lincoln or Omaha.

If the state is interested not only in providing higher education access, but in wealth-building by taking students from lower income brackets and moving them to higher ones, then this would be a good guide as to where to look in the state appropriations process for good investments.

Note also how these top ten are spread across the state, making for good investments in rural areas and smaller cities.

Unfortunately, the database does not include Chadron or Peru State Colleges, and it does not break down the state university so we can see how UN Kearney or UN Omaha would look if split off from UN Lincoln.

Nor is there any consideration given to in- and out-migration. Some Nebraska colleges do better than others in retaining students in the state. Such ranking are available from the U.S. Census and should be worked into any effort to use this database in making state appropriations.

How would the governor and state legislature go about modifying their current appropriations process to look at these performance and investment measures? A modest percentage of the higher education appropriations would be channeled through students rather than institutions, to favor students from lower income families who are most likely to stay in the state and to build wealth in Nebraska by moving up in the income brackets as a result of their education. Such programs already exist through the Nebraska Coordinating Commission for Higher Education, to include students at non-profit institutions. The appropriations through students must be sufficiently large so as to make all institutions consider them in their own admissions and student financial aid decisions.

The new database, called "Chetty" after its creator, should be used by states across the country as an accountability tool, to make certain taxpayers are getting their money's worth from higher education spending. By the same token, institutions that are doing a good job now have a powerful tool to defend against thoughtless and counterproductive budget cuts.