Formula Funding Update

The legislature and Gov. Jennifer Granholm added $1 million to Northern's appropriation to help it transition to the legislative funding formula applied this year. At Monday's forum, President Les Wong said that if Northern makes no adjustments to its curriculum or operations and the formula remains in its current form, the university will face a $15 million decrease in its state appropriation. That amounts to about a third of the $46 million in state support NMU received for the current fiscal year. According to Wong, hitting NMU with such a huge cut is not the intent of the legislators, but it could be the result.

President Les Wong used the illustration at Monday’s forum to stress the importance of “building an argument” against elements of the model that he said will adversely impact Northern for the unique niche it fills among the state’s public universities. The formula considers three factors: enrollment of fiscal-year equated students (FYES), research and degrees awarded.

“Some of the arguments we’ve presented against the plan are gaining more traction, but the formula continues to exist,” Wong said. “The greatest concern relates to degrees awarded and the fact that certain diplomas are worth more than others. For the health sciences, sciences or math, we get something like $28,000 per student. For psychology, the social sciences or English, it’s about $7,000. I don’t believe teachers are worth four times less than dental hygienists. In terms of policy, it’s not a bad idea – if the state needs something, it should pay for it."

However, Wong said that doesn't take into account the complexities of the 15 universities. He also added another part of the degrees-awarded factor that hurts NMU is the lack of value attached to one-year and certificate programs, which usually have a very high placement rate and are very important to the economy of the Upper Peninsula.

“But right now, those programs get zero credit," Wong said. "Northern needs a responsive plan so we don’t abandon those students, but yet don’t do ourselves a disservice if the formula remains in its current form.”

To fare better in the formula funding model, Wong said Northern needs to get better at measuring outcomes and developing a clearer picture of the degree completion process. “In many ways, outcome measures are a reflection of the entire university—not only academics, but student support, tutoring, advising, counseling and other areas.”

Wong said the university is not pressed for an immediate strategy now because legislators are preoccupied with the upcoming election. But he is meeting with academic department heads to begin shaping an agenda for next semester, as the appropriations process goes into full swing. Wong said Northern has an alternative to the current funding model and a plan on how to advocate for it, and he looks for campus-wide support as the process moves forward.