OAR 589-002-0120: Community College Funding Distribution

(1) Funding for the Community College Distribution Model shall be distributed, subject to funding availability, in eight payments as follows: (a) For the first year of the biennium, July 15, August 15, October 15, January 15, and April 15; (b) For the second year of the biennium, August 15, October 15, and January 15; (c) The July 15 payment of the first year of the biennium shall be calculated using the previous biennium’s Community College Support Fund level. (d) Should any of the dates set forth above occur on a weekend or recognized holiday, payment shall be made on the next available business day. (e) All payments, made before actual property taxes imposed by each district are certified by the Oregon Department of Revenue, shall be based on the department's best estimate of quarterly entitlement using property tax revenue projections. Payments shall be recalculated each year as actual property tax revenues become available from the Oregon Department of Revenue and any adjustments will be made in the final payment(s) of the fiscal year. (f) Any student support and student success funding distributions made under subsection 5(d) shall occur in quarterly payments, each consisting of one quarter of the annual allocation of student support and student success funding. Such payments shall occur in January, April, August, and October of every year and, when made in the same month as regular Community College Distribution Model payments, shall occur at the same time. (2) Community college districts shall be required to submit enrollment reports in the format specified by the commissioner, including numbers of clock hours realized for all coursework, in a term-end enrollment report by the Friday of the sixth week following the close of each term. If reports are outstanding at the time of the quarterly payments, payment to the district(s) not reporting may be delayed at the discretion of the commissioner. (a) All payments, made before actual Full-Time Equivalent (FTE) student enrollment data are available shall be based on the HECC’s best estimate of quarterly entitlement using student enrollment data from previous years. (b) Payments shall be recalculated each year as FTE student enrollment data become available and any adjustments will be made in the fiscal year. (3) Reimbursement through the Community College Distribution Model shall be made for career technical education, upper-division collegiate, lower-division collegiate, developmental education and other courses approved by the Commission in accordance with OAR 589-006-0100 through 589-006-0400. State reimbursement is not available for hobby and recreation courses as defined in 589-006-0400. (4) Residents of the State of Oregon and the states of Idaho, Washington, Nevada, and California shall be counted as part of each community college district’s Community College Distribution Model reimbursable FTE, but only for those students who take part in coursework offered within Oregon's boundaries unless otherwise specified in the FTE Guidelines document published by CCWD. (5) State funding for general community college operations is appropriated by the legislature on a biennial basis to the CCSF. The amount of state funds available for distribution from the CCSF for certain categorial programs (also known as “set asides”) shall be calculated based on the following: (a) Corrections. Funds to support educational services provided to adults in custody (AICs) of state penitentiary and correctional institutions by community college districts shall be subtracted from the amount appropriated for the CCSF before the Community College Distribution Model is calculated. The amount available for services provided to AICs shall be equal to the funding amount in the preceding biennium, except as adjusted to reflect the same percentage increase or decrease realized in the overall CCSF appropriation or otherwise determined in consultation with community colleges and Department of Corrections. The distribution method of funding for individual state penitentiary and correction institution programs provided by community college districts will be determined in consultation between the agency, the community colleges, and the Department of Corrections. (b) Contracts Out of District (COD). Funds to support COD programs described in OAR 589-002-0600 shall be subtracted from the amount allocated to the CCSF before the Community College Distribution Model is calculated. (A) A community college district providing contracted out-of-district services will receive an allocation equal to the college's number of reimbursable COD FTE multiplied by the statewide average of non-base Community College Distribution Model funds per total funded FTE. The average funds per total funded FTE is based on the same year COD services are provided. (B) The allocation is distributed after the reimbursable COD FTE has been reported to CCWD for the full academic year. An adjustment to the allocation may be made if the final audited FTE is significantly different than the COD FTE from which the allocation was made. (C) To be eligible for a COD allocation, each participating community college district must: (i) Provide the department with a copy of the agreement between the community college district and the local participating entity by October 1 of each service year. (ii) Enter into a contract with the department by January 1 of the service year for a COD allocation payment. (iii) Follow all requirements found in OAR 589-002-0600. (c) Distance Learning. Funds to support targeted investments such as distributed learning shall be subtracted from the amount allocated to the CCSF before the Community College Distribution Model is calculated. The amount available for these investments shall be equal to the funding amount in the preceding biennium, except as adjusted to reflect the same percentage change to the current biennium’s total CCSF appropriation. (d) Student Support and Student Success Funding. Beginning with the 2024-25 academic year, funds shall also be distributed on the basis of prioritized populations in the case of student support and progression and completion metrics in the case of student success. The amounts distributed through this section shall be removed from the total CCSF prior to the calculation of the Community College Distribution Model distributions under subsection (6) of this rule. (A) The amount of funding available for distribution for Student Support and Student Success under this subsection shall be as follows: (i) For fiscal year (FY) 2025-$12.5 million. (ii) For FY 2026-$21 million. (iii) For FY 2027-$29 million. (iv) For FY 2028-$33 million. (v) For FY 2029-$37 million. (vi) For all subsequent biennia, the amount distributed shall be equal to 10% of the CCSF with half distributed in each year of the biennium. (B) Funds under this subsection shall be distributed with 60% allocated to student support and 40% allocated to student success during fiscal years 2025 through 2027. Thereafter, half of the funding shall be distributed for student support and half for student success. (C) In both cases, calculations shall use a three-year weighted average with the first year prior to current weighted at 40%, second year prior to current weighted at 30%, and third year prior to current weighted at 30%. All payments, made before actual student support or student success data are available shall be based on the HECC's best estimate using relevant data from previous years. (D) Student support funding shall be distributed on the basis of the relative weighted total headcount of students from the following categories as defined in OAR 589-002-110: (i) Low income students (ii) Adult students (iii) Students from Underrepresented Racial/Ethnic groups (iv) CTE/Workforce students (v) Any students who are in two categories shall receive a 20% bonus, students in three categories shall receive a 30% bonus, and students in all four categories shall receive a 40% bonus. (E) Student success funding shall be distributed on the basis of relative weighted total progression and completion metrics as defined below or in OAR 589-002-110: (i) The number of students who for the first time have earned at least 15 but less than 30 credits weighted at 10%. (ii) The number of students who for the first time have earned 30 or more credits weighted at 10%. (iii) The number of students who have, for the first time, earned credit for and completed a gateway course in a given academic year weighted at 10%. Only one gateway course shall count per student in a given academic year. (iv) The number of students who, for the first time, have met the defined contact hour thresholds for noncredit courses as defined in OAR 589-002-110 weighted at 10%. (v) The total number of completions in a given academic year, with each student limited to a single completion in a given academic year weighted at 100%. Completions by students from the prioritized populations defined in OAR 589-002-110 shall receive a 50% bonus, meaning they are weighted at 150%. (F) A technical review of this subsection, limited to identifying unintended consequences and validating data, shall occur during FY 2027. A full review of the Community College Distribution Model with related set asides shall occur every five years starting with FY 2030. (e) Funds remaining in the CCSF after all distributions made in the subsections above as well as the strategic fund described in OAR 589-002-0130 shall be distributed through the Community College Distribution Model as described in section 6 of this rule. (f) State general fund and local property taxes for territories annexed or formed effective June 1, 1996 or later shall not be included in the funding formula for the first three years of service. Additionally, the FTE generated in newly annexed territories shall not impact the funding formula during the first three years of service. Beginning in the fourth year, funding will be distributed through the formula as outlined in this rule. (6) Distribution of funds to community college districts through the Community College Distribution Model shall be based on the following factors: (a) Base Payment: For the 2022-23 fiscal year, each community college district shall receive a base payment of $1,011 for each Weighted Reimbursable FTE up to 1,100 and half that same amount for unrealized enrollments between actual Weighted Reimbursable FTE and 1,100 FTE. Each year thereafter, the base payment will be adjusted by the amount of the annual seasonally unadjusted CPI-U that includes the Portland metro area as published and defined by the US Bureau of Labor Statistics and selected by the HECC. The base payment for each community college district will be adjusted according to the size of the district. Community college district size for purposes of this adjustment will be determined each year by the FTE set forth in section (8)(b) of this rule. The base payment adjustments shall be: (A) 0–750 FTE 1.3513; (B) 751–1,250 FTE 1.2784; (C) 1,251–1,750 FTE 1.2062; (D) 1,751–2,250 FTE 1.1347; (E) 2,251–2,750 FTE 1.0641; (F) 2,751–3,250 FTE 1.0108; (G) 3,251–3,750 FTE 1.0081; (H) 3,751–4,250 FTE 1.0054; (I) 4,251–4,999 FTE 1.0027; (J) 5,000 or more FTE 1.000. (b) Equalized Funding: The Community College Distribution Model is designed to distribute funding based on each community college district’s FTE. (A) The equalized amount per FTE is determined by dividing Total Public Resources (TPR) — excluding base payments, contracted out-of-district payments, and any other payments directed by the Commission or the legislature — by funded FTE. The department shall make the calculation based on submission of FTE reports by community college districts and in accordance with established FTE principles. (B) To determine the number of funded FTE for each community college district, a three-year weighted average of fundable FTE for each community college district will be used with the first year prior to current fundable FTE weighted at 40%, second year prior to current fundable FTE weighted at 30%, and third year prior to current fundable FTE weighted at 30%. (c) A Biennial Growth Management Component is added to the calculation of each community college district’s funded FTE. The purpose of the Biennial Growth Management Component is to manage the level of total public resource available per FTE within the total public resources available. The Growth Management Component shall only apply to reimbursable FTE at or above 1,101. (A) The methodology for calculating the base year and subsequent biennial growth management component is displayed in Table 1 “Community College Distribution Model Growth Management Calculation Tables.” (B) The calculations that will implement the Growth Management Component in the Community College Distribution Model are available in Table 2 "Formula Calculation of Fundable FTE by Community College District.” (C) The Commission has authority, on a biennial basis, to set the “quality growth factor” that may increase or decrease the number of FTE that will be counted for funding purposes above or below the Biennial Growth Management Component. The Commission will consider the following principles as guidelines for setting the “quality growth factor”: (i) Balance the desire to support growth beyond that which is funded through the funding formula Community College Distribution Model with the desire to enhance quality by increasing the level of funding provided on a per-student FTE basis. (ii) The TPR per FTE should not erode by more than 5% on an annual basis. (iii) Where current TPR per FTE is determined to be insufficient to support the “quality of education” desired, a growth factor could be established that would increase the TPR per FTE. (iv) If revenue is significantly reduced during a biennium, the Commission may reduce the “quality growth factor.”