Presented to the HIGHER EDUCATION FUNDING STUDY COUNCIL February 23, 2006

1. REPORT OF THE TAXONOMY SUBCOMMITTEE OF THE STATE SUBSIDY CONSULTATIONRosemary Jones (Co-Chair)Darrell Winefordner (Co-Chair) Presented to the HIGHER EDUCATION FUNDING STUDY COUNCIL February 23, 2006

2. Committee Membership • Rosemary Jones, Cuyahoga Community College (Co-Chair) • Darrell Winefordner, Ohio University (Co-Chair) • Jeff Boudouris, Sinclair Community College • James Buck, Southern State Community College • Chris Dalton, Bowling Green State University • Jan Diegmueller, University of Cincinnati • Ralph Gutowski, Miami University • Michael Mayher, Lakeland Community College • Roger Murphy, Shawnee State University • Tom Reed, Owens State Community College • L. Lee Walker, The Ohio State University • Vikki Williamson, Central State University • OBR Staff: • Rich Petrick * Neal McNally * Darrell Glenn • Andy Lechler * Katie Hensel

3. Goals • Models will have similar costs and characteristics • Models will be predictable and easier to manage • Models will be easier to understand and communicate

4. Process • Built upon the past • Clustering work of last biennium • History of development of current formula • Data driven • Iterative (over 25 versions reviewed) • Assumed that all changes must be funded within current funding level, transition will be easier with additional funding. • Conceptual tempered by reality • Sector, campus impacts evaluated

5. Taxonomy and Data Recommendations • Identify model costs by a subject-oriented grouping taxonomy • Arts & Humanities (AH) • 4 undergraduate levels • 2 graduate levels • Business, Education, and Social Sciences (BES) • 4 undergraduate levels • 3 graduate levels • Science, Technology, Engineering, Mathematics, and Medicine (STEM2) • 5 undergraduate levels • 4 graduate levels • 2 Doctoral Models and 2 Medical Models

6. Taxonomy and Data Recommendations • Base costs on a six-year average • Cost evaluation based on total costs • Revise or eliminate manual adjustments • Strengthen data consistency and integrity

7. SSI Implementation Recommendations • Simplify by eliminating or phasing out weightings or other adjustments • Use a “Uniform State Share” funding model as the starting point for SSI allocations. • Adjust the “Uniform State Share” in a transparent manner • Doctoral set-aside • Enhancement (weight) for Graduate models • Enhancement (weight) for STEM2 • Enhancement (weight) for Medical 2

8. Fiscal Stability • Transition Strategy Needed • Balance need for change with fiscal stability • Measure stability at the campus level • Eliminating some long-standing funding practices will warrant special consideration for funding

9. Strengths • Variance decreased by 42% overall • Details of impact of each step available by campus, by sector, and in rank order of impact • Year-to-year fluctuations smoothed • Streamlined approach to costs and allocations • Adjustments limited and transparent • Focus on data integrity • Able to be evaluated and realigned every biennium