A Need-Based Funding Model for Universities
An Overview of the Components and Methodologies Used to Determine Institutional Funding Needs
Desirable Attributes of the Model:
- Ensures adequate funding
- Simple to understand
- Provides equitable funding
- Stabilize funding
- Responsive to changes within institutions
- Sensitive to colleges’ different missions
- Based on reliable, uniform, and replicable data
- Based on the state goals for postsecondary
- Provides incentives for effectiveness and efficiency
- Makes provisions for funding special-purpose units
Merits of the Model:
Institutional Need is determined using cost data collected and compiled by the University of Delaware on 175 institutions over a 10-year period and average SREB Faculty Salaries.
Equity is achieved when every institution receives the same funding for the same discipline and level of Student Semester Credit Hour (SSCH) produced by the institution.
Model simplicity is achieved by reducing the SSCH to four Cost Categories (determined by Delaware Data) and three levels of instruction (undergraduate, graduate, and doctoral).
Model provides for unique institutional missions by special funding methodologies.
The Model
Expenditure Functions:
The model determines funding needs in six (6) SSCH/FTE-based expenditure functions, one (1) facilities square footage based function, two (2) special mission functions and a diseconomy of scale.
SSCH/FTE-Based Functions:
- Teaching Salaries
- Other Instructional Costs
- Library Cost
- General Institutional Support
- Research
- Public Service
Square Footage-Based:
- Facilities Maintenance and Operations
Special Missions:
- Traditional Minority Mission
- Land Grant Mission
Diseconomy of Scale:
- Institutional Support & Other Instructional Costs for less than 3500 FTE
Teaching Salaries
Methodologies:
Sum each institution’s SSCH by CIP-code into 4 discipline cost-categories by 3 levels, undergraduate, graduate (all non-doctoral level graduate enrollment), and doctoral levels.
Result = 12-cell matrix SSCH enrollment
Four Disciplines Cost Categories:
- (Least Expensive) - English, General Studies, Mathematics, Interdisciplinary Studies, Health-Related Knowledge, Interpersonal Skills, Leisure & Recreational Activities, Personal Awareness, Philosophy, Psychology, Public Administration, and Social Sciences
- Ethnic & Cultural Studies, Marketing, Communications, Education, Languages, Home Economics, Law, Biological Sciences, Parks & Recreation, Basic Skills, Construction Trades, Mechanics, Precisions Production, Transportation, Business Management
- Agriculture, Conservation, Architecture, Communications Technologies Computer & Information Sciences, Library Science, Physical Sciences, Science Tech, Visual & Performing Arts, Health Professions
- (Most Expensive) – Engineering, Engineering Related Technology
SSCH Required to Produce an FTE Faculty Member by Cost Category and Level
| Levels | |||
| Cost Categories | Undergraduate | Graduate | Doctoral |
| I. | 645 | 170 | 130 |
| II. | 480 | 250 | 145 |
| III. | 365 | 160 | 120 |
| IV. | 230 | 102 | 70 |
Calculations:
Each institution’s SSCH are classified into the 12-cell Cost Category-Level Matrix.
Each of the 12 SSCH cells divided by the SSCH required by that Cost Category for an FTE faculty.
FTE faculty numbers are totaled for each of the 3 levels.
The FTE faculty are multiplied by an SREB average faculty salary for the appropriate level ensuring equal funding for all SSCH of the same discipline and level.
Other Instructional Costs
Expenditure types:
Academic Departmental Operating, Non-Credit Instruction, Correspondence Courses, Faculty Staff Benefits, etc.
Calculation:
45% of Teaching Salaries
Library Costs
Expenditure types:
Librarians and support staff salaries, fringe benefits, library maintenance and operations, collection acquisitions and maintenance, and library technology costs.
Calculation:
11% of the sum of Teaching Salaries and Other Instructional Costs
General Institutional Support
Expenditure types:
Student services, financial aid, academic deans and other academic support staff, general administration, campus security, admissions, personal and academic counseling, campus computing centers, etc.
Calculations:
54% of the sum of Teaching Salaries and Other Instructional Costs
Research
Expenditure types:
Salaries and benefits of research faculty and laboratory assistants, research supplies, animal facilities, lab supplies and support
Calculations:
5% of undergraduate level teaching salaries generated
25% of graduate level teaching salaries generated
50% of doctoral level teaching salaries generated
Public Service
Expenditure types:
Governmental relations, public broadcasting, official functions, parent activities, news service, alumni affairs, etc
Calculations:
3% of teaching salaries
Facilities Maintenance & Operations
Expenditure types:
Utilities – electricity, water, sewer, gas, trash/garbage removal
Maintenance & operation – physical plant staff salaries and benefits, telecommunications, grounds maintenance, custodial care, and building maintenance (carpenters, electricians, plumbers, painters, cabinet makers)
Calculations of Space Needs:
- Academic Space
The needed square footage is determined using the 5-Factor Academic Space Prediction Model. Space needs are determined in five categories:
- Teaching
- Academic Offices
- Library
- Academic Support
- Research
General Institutional Support - 50% of the Academic Space.
Auxiliary Space is excluded.
Calculation of Funding Needs:
Excess/Shortage Sq. Ft. = Total Sq. Ft. – Model Sq. Ft.
Funding Need = Excess/Shortage Sq. Ft. X $2.40/Sq. Ft. +
Needed Existing Sq. Ft. X $4.85/Sq. Ft.
Special Missions
Types of Special Missions:
Federal Land Grant Institutions
Traditional Minority Mission
Calculation:
Federal Land Grant Institution = 10% of Teaching Salaries
Traditional Minority Institution = 10% of FTE based Funding
Diseconomy of Scale
An institution receives additional funding for Other Instructional Costs and General Institutional Support if its student FTE Enrollment is less than 3,500.
Calculation:
| FTE Below 3,500 | Funds/FTE |
| 1 - 150 | $1,200 |
| Next 150 | $1,000 |
| Next 200 | $ 800 |
| Next 250 | $ 600 |
| Next 250 | $ 300 |
| Next 200 | $ 200 |
Total Funding Need
Calculations:
The total funds needed by the institution are represented by the sum of the recommendations for: Teaching Salaries, Other Instructional Costs, Library Costs, General Institutional Support, Research, Public Service, Facilities Maintenance and Operations, Special Missions, and Diseconomy of Scale.
Tuition and Mandatory Fee Income
Calculations:
= Undergraduate SSCH X $130
= Graduate SSCH X $190
= Doctoral SSCH X $230
Total = Sum of above calculations