Page 142 - American_Higher_Education_V4

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Act 359, passed
by the General
Assembly and signed
by Governor David
M. Beasley, mandated
that future funding
of public higher
education should be
based on these 37
indicators, not on the
formula of the past.
This year, 25
percent of the
increased funding
for public higher
education, or about
$4.6 million, was
awarded according to
the indicators. Next
year, 75 percent of
the “newmoney”—
perhaps $30 million
or more—will be
distributed in this
manner. Beginning
with the 1999-2000
academic year, 100
percent of state
funding is to be allocated on the basis of the 37 “quality
Or so the theory goes. As a practical matter, each public
institution will receive a “minimum resource requirement”
(MRR), and only 15 percent or less of its funding will depend
on performance.
“The MRR is really a base budget for each institution,”
said a member of the higher education commission who
requested anonymity, “but we can’t call it that and we can’t
refer to a ‘funding formula’ because the PR we’re putting out
says we’re awarding 100 percent of the money according to
John E. Smalls, director of finance for the higher
education commission, predicted the new budget approach
will mean “no more than a one or two percent change for any
given institution” because it will be “politically unacceptable”
for the state to reduce financial support for any college or
university significantly on the basis of poor performance.
The legislation also calls for the closing or merger of
low-performing schools, but no one interviewed during ten
days in the state thought local politicians would allow that to
Performance-based budgeting has grown increasingly
popular in recent years. A study by the Nelson A. Rockefeller
Institute at the State University of New York, found that two
thirds of the 50 states use performance measures in some way
and that more than half report these measures in the budget
process. However, in most states less than five percent of the
higher education budget is tied to performance, and no other
state has tried to use as many as 37 measurements of quality.
Austin Gilbert said he did not think 37 indicators were
too many. “The construction industry has 40,” he said.
David Maxwell, a former Clemson provost and now a
member of the Commission on Higher Education, keeps
asking why there are 37 measures and not 36, 38 or 110. “The
only answer I get is that the law says 37,” Maxwell said.
Supporters of the South Carolina plan say it will
convince a dubious public that the state’s public colleges and
universities are doing a good job and deserve more financial
Public support for higher education is said to have
waned in South Carolina in recent years. There have been
complaints about faculty members who do not teach enough,
unprepared students and low graduation rates. Some
businessmen believe good jobs are being lost to other states
because South Carolina colleges and universities are not
producing enough well-trained graduates.
Public confidence is thought to have been further
weakened by the escapades of former University of South
Carolina President James B. Holderman, who resigned
in 1990 after an expense account scandal and later was
imprisoned for lying to federal bankruptcy officials.
State Senator Setzler and others believe that requiring
greater accountability from public campuses through
performance-based budgeting will help to restore public
“I don’t think there’s any question that, with this
movement to excellence, you will see legislative and public
support for appropriate funding for higher education,” Setzler
said in an interview. “And that clearly was one of the goals of
the committee and the legislation.”
Others are not so sure.
“When all is said and done, I don’t think there will be
more money for higher
education,” said David
Fleming, director of
institutional research
at Clemson University,
one of three research
institutions in the state
(the others are the
University of South
Carolina and the Medical
University of South
Carolina). “Higher
education doesn’t have
a strong voice like other
citizens or public schools
or crime. Politicians can’t
get elected on higher
In the 1995-96
academic year, South Carolina local and state expenditures
per full-time equivalent student in four-year institutions
were $4,613—about $250 less than the average for the 15
states belonging to the Southern Regional Education Board,
according to an SREB report.
“The basic problem here is that higher education
Supporters of the
South Carolina plan
say it will convince
a dubious public
that the state’s
public colleges and
universities are
doing a good job
and deserve more
financial support.
Chairman Austin Gilbert, of the South Carolina Commission
on Higher Education, is a strong supporter of the new plan.