PHILADELPHIA (TNS) — The Pennsylvania legislature is likely to vote soon on a formula to award new state funding to Pennsylvania State University, Temple University, and the University of Pittsburgh based on each school’s performance, beginning next summer.

The new performance measures, which include graduation rates, affordability, and enrollment of low-income students and those pursuing degrees in wide-ranging occupations deemed critical for the state, were developed by a bipartisan council of legislative leaders and the acting secretary of education over the last several months.

The criteria outlined in a report made public last month would be used only for new money, not for existing funding, at least under the recommendations made by the council. Whether the schools get any increase in state funding through this new formula remains to be seen, as Pennsylvania faces a multibillion-dollar structural deficit.

The recommendations’ adoption could bring an end — or at least an ease — to funding battles between the legislature and the so-called state-related universities over transparency and accountability. State-related universities received hundreds of millions in state funding, yet have a quasi-public status exempting them from much of the state’s open records laws, a fact that has long been criticized by some legislators.

The three colleges, which got a total of about $551 million in general state support this year, have not received a funding increase in six years. Lincoln University, the fourth state-related school and a historically Black college that is much smaller than the other three schools, would be exempt from the performance-based funding under the new law.

Pennsylvania House Minority Leader Jesse Topper (R., Bedford), who chaired the eight-member committee, said the new process would help take the politics out of funding and reward colleges for showing improvement on specific data targets.

“It’s not the silver bullet to solve it all, but I do believe it goes a long way toward restoring trust between the institutions and the legislature, which is something that is sorely needed after these few years,” Topper said.

Legislators, he said, “need to see a return on investment. We need to know these schools are producing what we need for our workforce and for our economy.”

Pennsylvania is not alone in attempting to distribute funds based on performance. In 2023, 30 states had distributed more than $7.8 billion through similar formulas, according to the council’s report.

Senate Minority Leader Jay Costa (D., Allegheny), who also served on the council, said the five voting members on the committee adopted the recommendations unanimously. Others on the panel were Sen. Wayne Langerholc (R., Cambria), Rep. Peter Schweyer (D., Lehigh), and Angela Fitterer, former acting education secretary.

“It’s a well-thought-out and well-reasoned product,” Costa said.

One of the keys for Costa was that colleges’ current funding would not be at risk. He also was pleased that each of the three universities had a nonvoting representative on the council who could share the schools’ views and concerns and that experts gave input at public hearings.

The criteria established are important measures for which the colleges should be aspiring to hit high marks, he said.

The measures that will count

Under the recommendations, colleges would be rewarded based on factors including their “total weighted student count.” That figure would be calculated by looking at overall enrollment, with additional weight for students receiving federal Pell Grants targeted toward low-income families, students who attended high schools where 40% or fewer of graduates go to college, and community college transfers.

“Research suggests that one of the unintended outcomes of performance-based funding can be a decrease in access, particularly for underserved students, due to gamification,” the report said. “These student weights serve as a disincentive for universities to restrict access in order to improve performance.”

Additional weight would be given for enrolling students pursuing degrees in “high priority” occupations, including such careers in education, technology, and science.

The formula also would take into account colleges’ efforts to keep cost increases under the Higher Education Price Index. And it would incorporate overall four- and six-year graduation rates and six-year graduation rates specifically for Pell-eligible students.

Some of the measures, including graduation rates, would apply only to the colleges’ in-state students, whose tuition is discounted because of state funding.

If the legislature adopts the council’s recommendations, the new formula would go into effect for fiscal year 2026-27, which begins next July. Any new money in the 2025-26 budget — Gov. Josh Shapiro has proposed giving the schools $60 million — likely would be distributed under the current formula, giving schools a little help in getting ready to meet the new criteria the following year, Costa said. Lawmakers must approve a budget for fiscal year 2025-26 by July.

Topper said it would be “a gesture of good will” from the legislature, almost “like a signing bonus.”

The universities’ reactions

The recommendations received mixed reviews from the universities.

“We feel good about the outcome and really look forward to fiscal 2027 when it will be fully implemented,” said Ken Kaiser, Temple’s senior vice president and chief operating officer, who had served initially as a nonvoting member of the council.

Temple would benefit from the measures on community college transfers and Pell-eligible students, he said. More than a third of students who attended Temple last year were Pell-eligible. And the university also has improved graduation rates through its Fly in Four program, which provides support to students to finish their degrees on time.

“It’s not perfect, but it is good and will incentivize the right behavior and hold people accountable and hopefully generate new dollars” for state-related schools, he said.

Penn State was more critical.

Mike Stefan, Penn State’s vice president for government and community relations, called it “a transparent and predictable path forward for future increases” but said “the recommendation does not meet all of our goals.”

Penn State — the largest of the three schools, with more than 41,800 in-state undergraduates — has maintained it does not get its fair share of funding per student, and Stefan said the new formula does nothing to address that.

“Penn State will continue to receive less funding per student compared to Pennsylvania’s other public universities,” he said in a statement. “We will continue to educate members of the General Assembly about this inequity and advocate for fairness.”

Pitt did not offer specific criticism or praise.

“We appreciate the work of the … council and the thoughtful collaboration that has gone into developing this inaugural formula,” the school said in a statement. “We look forward to continued partnership with the commonwealth’s leaders as the proposal advances through the legislative process.”