What if, instead of borrowing, students could arrange for investors to pay their college bills in exchange for a fixed percentage of their future income? In this article, the authors answer this provocative question, arguing that the time has come to think more creatively about financing college, especially because Congress seems more inclined to…

In a sputtering economy, and with demographic changes ahead, the model of ever-increasing price and merit-based student aid cannot be sustained. But what new system might rise in its place? One option is returning to a system in which the government bears more of the cost of higher education--something that might be possible, if still unlikely, in…

Teacher effort, a critical component of education production, has been largely ignored in the literature due to measurement difficulties. Using a principal-agent model, North Carolina public school data, and the state's unique accountability system that rewards teachers for school-level academic growth, we show that we can distill effort from…

Two years ago, the problems of the District of Columbia Public Schools (DCPS) were so significant that many believed the system was beyond repair. According to the 2007 National Assessment of Education Progress (NAEP), only eight percent of eighth graders were on grade level in math, and 12 percent were in reading. With achievement gaps between…

During the last 25 years, there has been a major shift in the way that state and federal governments fund financial aid to students attending colleges and universities. This shift has been characterized by the idea of "cost sharing"--a "high tuition, high aid" model that requires students and their families to shoulder a greater percentage of the…

Federal law had long prohibited corporations and unions from using general treasury funds to make either direct contributions to candidates or independent expenditures that expressly advocate the election or defeat of a candidate. It didn't matter where the ads appeared--print, online, or TV. The rationale for these restrictions was plain:…

Beginning in 1997, a series of Ohio Supreme Court decisions ruled that Ohio's school foundation-based funding system was unconstitutional. Despite judicially mandated reform directives, little change was made until recently when Ohio adopted a modified Evidence-Based Model (EBM) into its statutory funding scheme. Ohio's EBM is intended to remedy…

In 2004 Colorado passed legislation enacting the nation's first voucher-based approach to financing higher education, known as the College Opportunity Fund (COF). The work of an unusual coalition that included higher education leaders, generally conservative policymakers, and others, COF completely replaced the traditional approach of subsidizing…

For decades, state funding of public historically black colleges and universities (HBCU) has been shown to be de facto discriminatory relative to the funding of their predominately white counterparts. Although the dual system has been legally dismantled, the disparate funding has remained in place in a number of ways. For example, recent research…

In Texas, all students are equal, but once again some are more equal than others. This policy update provides a description of the key elements of the existing Texas school funding system, identifies features that contribute to equity and those that maintain and expand inequity, and includes recommended reforms that would reinstate critical…

The complexity of the Free Application for Federal Student Aid (Fafsa) has been well documented and exhaustively discussed: At six pages and 120 questions, it is longer than even the 1040 tax form, with its two pages and 76 questions (not including schedules). The Fafsa's length and unfamiliar language--terms like "emancipated minor" and…

To be at the University of Arizona these days is, in some ways, to be under siege. The flagship university in one of the nation's fastest-growing states may have to eliminate some 600 jobs and merge dozens of programs to deal with two rounds of budget cuts imposed since June. Now the governor is telling the university and other state agencies to…

Cornell University professors, trustees, and alumni recently convened to consider whether rising costs threaten the notion that higher education can help anyone in America succeed. The exclusive Cornell Club may have seemed a venue at odds with the sober tone of the discussion. According to economics professor and higher education expert Ronald G.…

What drives governments with similar revenues to publicly provide very different amounts of goods for which private substitutes are available? Key examples are education and health care. This paper compares spending by Brazilian municipalities on pre-primary education--a good that is also provided privately--with spending on public infrastructure…

The content of this edition of the State Governance Action Report was informed by newspaper reports, online reports, state and institutional Web sites, and conversations with state and higher education leaders. It is current through February 1, 2011. Much of this legislative activity comes at a time when the fiscal conditions of states are…