State Strategies for Financing CTE NCSL Fiscal Analyst Seminar Laura Rasmussen Foster October 14, 2015 1 RTI International is a registered trademark and a trade name of Research Triangle Institute. www.rti.org
Agenda Introduction to RTI and NCICTE Review of NCICTE Report on CTE Funding Background Findings Overview of Competitive Funding Strategies in CTE Discussion 2
What Is RTI International? RTI is an independent, nonprofit institute that provides research, development, and technical services to government and commercial clients worldwide. Our mission is to improve the human condition by turning knowledge into practice. 3
Education and Workforce Development Capabilities Our expertise spans the lifelong learning continuum Early Childhood Education K-12 Education Post- Secondary Education Adult Education Workforce Development with particular expertise concerning the key transition points 4 Methods and services encompass: cross sectional and longitudinal survey design and implementation data collection/analysis/visualization evaluation and assessment effective reporting for technical and nontechnical audiences project implementation and technical assistance
National Center for Innovation in Career Technical Education National Center authorized in Carl D. Perkins Act Conduct scientifically based research and evaluation to improve career and technical education Report and disseminate information Awarded by U.S. Department of Education to RTI International in July 2012 Three-year contract Studies require government approval http://ctecenter.ed.gov/ 5
NCICTE Partners 6
NCICTE Current Products Reports (published and forthcoming): Availability of data on non-credit education Consortia formation and characteristics CTE finance Alternative credentials in corrections Connecting CTE and apprenticeship Training Topics: Career pathways terminology Consortia CTE data tools 7
Study: State Strategies for Financing CTE 8
Rationale for Study CTE more expensive to provide than other forms of instruction money matters! Increasing federal and state policy focus on competitive funding Update to 2001 report, Financing Vocational Education: A State Policymaker s Guide 9
CTE Cost Factors Smaller class size Specialized equipment and supplies Facility construction and maintenance costs 10
Report Background and Findings How Are States Funding CTE? Foundational funding only Local CTE programs are financed out of general state aid formulas that provide no earmark for CTE. Funding for area CTE centers only Dedicated funds provided to area CTE centers; other CTE programming funded through general state aid Categorical funding Targeted state funding for the exclusive use of CTE programming Formula approaches include: student-based, unit-based, and cost reimbursement 11
State Funding Approaches: Secondary (2011-12) Unit-based formula,7 Cost reimbursement method, 9 Foundational funding only, 8 Student-based formula, 21 Funding for area CTE centers only, 7 12
State Funding Approaches: Postsecondary (2011-12) Funding for area CTE centers only, 2 Student-based formula, 2 Unit-based formula, 3 Foundational funding only, 30 13
Categorical Funding: Student-Based (K-12) Determined by the number of students enrolled in a CTE program. Includes: Pro rata distributions based on level of student participation Weight for CTE students in K-12 foundational formulas Differential weighting based on program type or level of involvement 14
Categorical Funding: Student-Based Continued 15
Categorical Funding: Unit-Based (K-12) Allocates funding based on educational inputs to offset programmatic costs. Factors include: Average or minimum class size # of CTE instructors Other (salary/benefits, materials and equipment) 16
Categorical Funding: Unit-Based Continued 17
Categorical Funding: Cost Reimbursement Determines program allocations based on previous year s expenditures Reimbursement rates established by state depending on availability of resources Eligible expenditures range from equipment and materials to instructor salaries, transportation, curriculum development, and student support services 18
Categorical Funding: Cost Reimbursement Continued 19
Competitive Funding Strategies Performance-based funding: an approach to distributing funds conditioned on student or program performance Pay-for-success or social impact bonds: an initial private investment that gets repaid by government agencies if positive outcomes are achieved 20
States Use of PBF in CTE # of States Using PBF for Federal Funds for State Funds Secondary 2 5 Postsecondary 0 4 Measures include CTE completion, credential attainment, placement in PS or employment, graduation rates, credit attainment, and more. 21
Other Findings States have no or limited experience with pay-for-success models States are interested in adopting PBF strategies States require training on PBF formula development and implementation 22
RTI s PBF Development Process 1. Establish state commitment 2. Convene state task force 3. Specify state funding priorities 4. Define measures for allocating resources 5. Identify data source 6. Model formula allocations 7. Design an implementation plan 23
For More Information CTE Finance Interactive Report State Matrixes (Appendix) Competitive Funding PBF Tutorials Using Performance-Based Funding to Incentivize Change Laura Rasmussen Foster lrasmussen@rti.org 24