Where do we go from here?Bill HoldaPresident, Kilgore CollegeChair, Texas Association of Community Colleges

Don HudsonVice President, Texas Association of Community Colleges

Texas Association of Community College Business Officers2012 Annual ConferenceHorseshoe Bay, Texas

June 21, 2012

CHALLENGES AHEAD

All Funds Expenditures

2010-2011: $187.5 billion 2012-13: $173.4 billion

$81.9

$6.3

$72.5

$26.7

GR GR-DFed Funds Other

$81.3

$6.4

$54.7

$31.2

GR GR-DFed Funds Other

Expenditures (in billions)

2010-11 2012-13

All Funds $187.5 173.4 -7.5%($14.032)

Public Education

$50.265 $47.433 -5.6%($2.83)

Art. II(H&HS)

$65.465 $55.426 - 15.3%($10.037)

Higher Education

$20.319 $19.845 -2.3%($.474)

A Growing State• Texas has added 4.35 million new people since 2000

• An increase of 20.6% (from 20.8 million to 25.15 million)• The largest numeric increase of any state

• Majority of growth came from Hispanic increases• In 2000, those 25 and under:

42.8% Anglo / 40.4% Hispanic

• In 2010, those 25 and under:35.2% Anglo / 46.8% Hispanic

• In 2040, those 25 and under:19.4% Anglo / 67.1% Hispanic

Economic Indicators are Mostly Positive

• 6.9% - Latest Texas unemployment rate• Peaked in the Fall of 2010 at 8.3%

• 10.76 million – Non-farm employment• Up from a low of of 10.21 million in the Fall of 2009

• Texas Leading Index up 21% since low point in 03/2009(Texas value of the dollar, U.S. leading index, real oil price, well permits, initial claims for unemployment insurance, Texas stock index, help-wanted index and average weekly hours worked in manufacturing)

• Mortgage foreclosures down 40% from one year ago• Consumer Confidence Index is up 17.3% from one year

ago

Feb. 1

2

Dec.11

Oct. 11

Aug.11

June

.11

April.1

1

Feb.11

Dec.10

Oct.10

Aug.10

June

.10

April.1

0

Feb.10

Dec.09

Oct.09

Aug.09

June

.09

April.0

9

Feb.09

Dec.08

Oct.08

Aug.08

June

.08

April.0

8

Feb.08

Dec.07

Oct.07

Aug.07

June

.07

April.0

7

Feb.07

Dec.06

Oct.06

0

0.5

1

1.5

2

2.5

Sales Tax Revenue (in billions)

Sales Tax Revenue

Recession

THREE MAJOR CHALLENGES FOR BUDGET WRITERSLimits to constructing future Texas budgets

2008-09 2010-11 2012-13

$14.2 $14.2 $14.2

$5.0$4.2 $4.4

Cost of 2006 Tax Cut

Structural Deficit (in billions)

Public Education• Per student funding has declined significantly

• Texas spends $8,908 per student in the current school year.

• This is a decline of $538 from the 2010-11 school year

• Current national average $11,463 per student

• Continued enrollment increases driving costs

• Lawsuits• Property Tax: All five argue that local boards have no choice but to raise taxes

• Adequacy: First four argue that the funding provided by the Legislature does not

adequately fund public education in Texas.

• Efficiency: TREE group argues that current system is rife with bureaucratic

waste.

Medicaid• $23.3 billion - What Texas spent in all funds on Medicaid and the

Children’s Health Insurance Program (CHIP) in FY 2009• 95% of this amount was spent on Medicaid• $7.6 billion was state revenue

• 3.4 million – The current number of Medicaid caseloads• 6.2 million - The number that Healthcare Reform will add to

Medicaid by 2020 (Texas Comptroller)• 78% - The amount Medicaid enrollments grew from FY1999 to

FY2009 • Medicaid population mostly “Non-disabled children”

• 53% of all beneficiaries • But only 29% of all Medicaid spending

PUBLIC POLICY CHALLENGES FOR COMMUNITY COLLEGESThe Call of the Student Success Agenda

Pressure to Improve Results

Pressure to Improve Results

Pressure to Improve Results

TAKING OWNERSHIP OF THE SUCCESS MOVEMENTThe TACC Student Success Agenda

Factors Leading to Potential Solutions

TACC Student Success

Movement

Philanthropy

Political Pressure and

SupportEngaged Boards, Administrators,

and Faculty

19

TACC Student Success Center:Leadership Team Engagement Model

Faculty/Staff Leadership

Teams

TACC Center/C

ollege Leaders

Policy Makers

CHANGING THE LEGISLATIVE CONVERSATIONA new partnership for Student Success

21

TACC Student Success Movement

Measuring and Funding Success

College Readiness

Workforce/Skills

Alignment

Texans in Community

Colleges

Transfer and Articulation

Where have we been with funding?• 1942-63: Sufficient to Supplement

• $50 (1942) to $250 (1963) per FTSE• Funding for Fall only• Funds only for academic/transfer; no technical-vocational• Total # in 1963: 30 college districts

• 1964-73: Community College Expansion• Still funded on FTSE basis, but grew from $250 to $625• 14 new colleges; 44 college districts in 1973• Funds for technical-vocational added• Contingency Funds for enrollment growth during biennium

• 1974-2012: Community College Formula System

Contact Hour Funding

• 1974-84: The Formula as the Basis for Community College Funding

• 1985-2003: Instructional Appropriation Distributed by the Formula

• 2004-2012: Sufficient to Supplement II

74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 120.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% of formula $/ch $/ch 2012 $s

Year (Even Only)

$ pe

r Co

ntac

t H

our

% o

f Ful

l For

mul

a

New funding model – 83rd Legislature

Other Issues:• Quality Employee Benefits: Group Health Insurance, Retirement• Base Year: Biennium, not annual with reallocation• Student Success Policies: Transfer, Pathways, Financial Aid, Workforce

Straw Poll Results (preliminary)

Increase Same DecreaseFaculty Salaries 32 (78%) 1-4% 9 (22%) 0 (0%)

Staff Salaries 32 (78%) 1-4% 9 (22%) 0 (0%)

Tuition/Fees 27 (66%) 14 (34%) 0 (0%)

Property Taxes* 15 (37%) 21 (51%) 2 (5%)

Source: TACC Survey, 41 colleges reporting

*3 college districts indicated TBA on property tax question

NEW DIRECTIONS - TACC

State of TACC• TACC is changing and taking more responsibility for the

success agenda. This change will require some short term investments to create a new structure for long-term success.• Public Relations Campaign• New Mathways Project• Cooperative Purchasing Network• Expanded role with Trustees

• Changing college culture and conversation beyond a series of initiatives to a full-scale movement.

Questions?View from the Bench