Two years ago, the state's community-college leaders railed against a call to reform the way they are funded. But after receiving a $20 million boost in the recently signed state budget on the heels of several years of cuts, the presidents of all 15 Massachusetts community colleges have signed on to the new plan, realizing that the additional funds would ease what was likely to be an inevitable transition.
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While Massachusetts isn't the first state to move in this direction, its approach is a particularly bold one that signals the increasing importance of community colleges. The state and national economies need the unique skills that community-college graduates provide. A report from the National Governors Association cited national surveys showing that 40 percent of college graduates lack the applied skills needed to meet employers' needs. A 2011 study by the Boston Foundation estimated that 38 percent of Massachusetts jobs require more than a high-school diploma but less than a four-year college degree.
Community colleges too often have failed to meet that workforce-development challenge. Most Massachusetts community colleges have three-year graduation rates of 18 percent or less, and the Bay State's pay-for-performance plan seeks to change that. While each community college will get a basic $4.5 million operating subsidy, half of the rest of their funding will be distributed based on student credit hours completed and the other half will be based on performance measures that will include the number of students who earn degrees or certificates or transfer with a certain number of credits.
Extra credit will be given for degrees in such sought-after fields as science, technology and health care, and also for the success of African-American, Latino and low-income students.
About 10 states already link public higher-education budgets to performance, but in most cases only 5 to 10 percent of the budget is tied to results. Tennessee linked its entire public higher-education budget to performance three years ago and has seen improved performance.
I have long advocated that both K-12 education and four-year college programs be liberal-arts-based. But community colleges are the appropriate niche for tailoring programs for workforce needs.
It may have taken some extra money, but community college leaders in Massachusetts should be applauded for getting on board with a plan that holds them accountable and promises to improve their schools' performance. If it does, that will be good news for the economy.
