Funding Model Ratio Update

Under the direction of the State Council of Higher Education for Virginia (SCHEV), Virginia higher education institutions have used a student:faculty ratio model, also called the “Base Budget Adequacy Funding Model,” for funding reference. In addition, each institution from within the Virginia Community College System (VCCS) has been provided with an efficiency factor to adjust the funding model under which they are expected to operate. These student:faculty ratios by discipline are merely recommendations from the state to colleges in determining their operation. 

However, due to changes in student demographics, instructional delivery modes, program offerings, an economic downturn and budgetary cuts, many higher education institutions in Virginia feel pressured to raise tuition and fees to meet the adequacy funding model. The varied nature of different institutions makes the existing funding model outdated and inadequate to meet the strategic goal of the Commonwealth.

In 2021, the Virginia General Assembly provided $300,000 in general funds for SCHEV to lead a study of costs and funding needs for Virginia public higher education institutions. The comprehensive report of this study is now available on the SCHEV website. You can download a copy of the Virginia Cost Funding Need Study here. Basically, the base adequacy model “no longer serves as a rational or strategic approach to resource allocation.” Based on a set of design principles depicted in the report, a new, dynamic preliminary cost and funding model was proposed, and recommendations for the implementation and continuous improvement of the new model were also given in the report. 

If you have questions about the funding model update or the SCHEV study, please contact Sam Shi, AVP of Strategic Insights.

Submitted by:
Sam Shi, AVP of Strategic Insights, XShi@nvcc.edu