September 30, 2020

Funding Formula Scenarios for Governor’s FY 2021-22 Budget Request – Mr. Jason Schrock, Mrs. Emily Orr, and Ms. Emma Fedorchuk, CDHE, discussed potential funding formula options and different funding scenarios that were being considered for the Governor’s FY 2021-22 budget request that will be submitted to the legislature on November 2, 2020. Mrs. Orr and Ms. Fedorchuk first gave an overview tutorial on the new formula established by H 20-1366.

Mr. Schrock explained that the Governor’s budget decisions are still pending and remain confidential, the formula approaches discussed were options under consideration, and that the funding scenarios were just for illustrative purposes. The funding reduction amounts below FY 2019-20 levels were presented due to the continuing budget challenges faced by the state from COVID’s impacts on the state economy and revenue. The actual requested FY 2021-22 funding amounts for higher education in the November 2 budget request could end up being within the range of scenarios discussed or funding could be a higher amount.    

Commissioners expressed a desire to advocate for additional state funding over the amounts included in the funding scenarios presented, especially in light of the institutional budget challenges resulting from COVID and the implications these budget challenges have on Master Plan target student populations. Further, the commissioners expressed that they did not favor the two formula options presented. There were concerns that the performance component of the formula was not being utilized appropriately as a result of the substantial funding adjustments in step one of the formula. The commissioners also stated that the option one formula resulted in some institutions being too disproportionately impacted. Some commissioners further questioned the merits of looking at institutions’ overall Education and General funding in funding formula allocations. The commissioners asked staff to explore other formula approaches that would better utilize the performance component of the formula while also providing necessary help to certain institutions. The Commissioners also indicated that the institutions should be involved in the development of the formula approach.