How Do States Fund Postsecondary Education?

Postsecondary & Workforce

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Education Commission of the States recently released a 50-State Comparison detailing how state policies address postsecondary education funding. Many resources already exist in the postsecondary education funding space like the State Higher Education Finance report, projects focused on performance- and outcomes-based models and numerous resources on postsecondary education funding from the National Association of State Budget Officers. This 50-State Comparison departs from existing resources in several key ways: in our data source, in how we address the connection between policy and practice, and in our preference for describing state policy over categorizing models.

First, to compile this 50-State Comparison, we looked exclusively at adopted state statutes, statewide rules and regulations, agency rules or regulations, enacted state budget bills and, in limited cases, alternative, publicly available policy documents that outline postsecondary education budgeting and funding requirements. This means that our project is tightly aligned with what is outlined in policy and may, in certain contexts, deviate from state practice.

We cataloged what state policies say to showcase the array of funding regimes in place across states as articulated in their laws and policies. Forty-five states plus the District of Columbia have adopted statute on the books that describes postsecondary education budgeting and funding. We do not intend to elevate the adoption of state statute as an ideal way to make postsecondary education funding policy. Many states have robust funding methods detailed in rule, regulation, agency policy and other documents, which are also collected in the 50-State Comparison. Still other states may have funding practices in place that have not been codified; importantly, these practices would not be reflected in this resource.

Finally, this 50-State Comparison deviates from similar reports on postsecondary education funding because we only use broad categories to classify state models. In this comparison, state models are classified in three categories:

    • Base model: funding is based on the funding received in a previous year.
    • Base plus model: base funding is in place and any new funds are allocated through a different means.
    • Formula model: state policy describes the components of a formula or equation used to calculate funding amounts for postsecondary education.

We look forward to partnering with states as they consider their funding model policies, which might include providing state profiles, policy comparisons or other analysis. If Education Commission of the States can support your state in postsecondary education funding policy issues, please don’t hesitate to reach out to us.

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Senior Policy Analyst at Education Commission of the States |

Sarah supports the research and analytical capacity of the policy team in her role as a senior policy analyst at Education Commission of the States. Sarah has extensive experience in student financial aid programs, and is frequently called upon as an expert in state financial aid policy and practice. A recipient of state aid herself, Sarah believes that state policy leaders have a key role to play in ensuring affordable postsecondary opportunities for students from all backgrounds.

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