A bill that could exempt more West Virginia public four-year colleges from state oversight of their spending likely would free Fairmont State, Shepherd and West Liberty universities from that supervision immediately.
Representatives from Fairmont State and Shepherd said they helped write an earlier draft of the legislation, Senate Bill 760.
Bluefield State College, Concord University, Glenville State College and West Virginia State University would remain the only four colleges that would continue to require state Higher Education Policy Commission approval for things like new buildings and new academic programs, according to a Gazette-Mail review of the commission’s data.
State lawmakers exempted the West Virginia School of Osteopathic Medicine, West Virginia University and Marshall University and their branch campuses from this oversight in 2017. That fueled the smaller colleges’ calls for more exemptions for themselves.
The bill is scheduled to be up for amendments today on the floor of the House of Delegates. It could pass by Thursday, heading to the governor for his signature or veto.
The legislation provides a list of five criteria for exemption from oversight:
- A six-year graduation rate of at least 45% on average over three years;
- A retention rate, meaning the proportion of first-time, full-time freshmen who return for a second academic year, of at least 60% on average over three years;
- Not having an enrollment decrease of more than 5%, not including high-schoolers taking college classes, over three years;
- At least 50 days cash reserved for operations on average over the past three years; or
- A Composite Financial Index (CFI) of not less than 1, as determined by audits.
For schools that meet at least three of those criteria, the bill would eliminate the commission’s power to veto multi-million-dollar building projects colleges want and reject possibly duplicative academic programs the colleges want to create.
Schools that don’t currently meet enough criteria might meet them in the future and earn exemption. Alternatively, a school not meeting any criteria could persuade the commission to grant exemption, and the commission could grant it, under the bill.
“I’d like all of those numbers to be higher,” commission interim Chancellor Sarah Tucker told the House Education Committee Monday afternoon regarding the criteria. “And I think that we have to be thinking about what we’re telling our students about whether or not they are going to graduate.
“I have concerns over there being no statewide oversight over capital projects, but that’s a policy decision that you all have to make,” Tucker told delegates. Capital projects often include multi-million-dollar construction projects.
But the committee advanced the bill without offering amendments on a voice vote with a couple no votes heard.
The bill does leave up for interpretation how to count some of these criteria, including whether the retention rate should just count students who returned to that particular college or who stayed in higher education in general, but someplace else.
The following retention rate numbers use the more stringent requirement of returning to the same school:
• Looking at the latest data available from the commission, West Liberty meets the most criteria. It meets four, falling short only on the CFI.
The commission said a CFI of 1 — the minimum to meet that criterion in the bill — is “equivalent to weak financial health,” while 3 “signifies relatively strong financial health.” West Liberty has a 0.4.
• Only Fairmont State has a CFI over 1, at 1.99. Several schools have negative CFIs.
“Some of our institutions are in significant financial distress,” Tucker said.
Fairmont State also has an average 180 days of cash reserved for operations and a 66% retention rate, so it meets three of five criteria. Its average six-year graduation rate is only 40%, while its enrollment loss over three years is barely over the 5% cutoff.
• Shepherd, which has a negative CFI and had an 8% enrollment drop, makes the cut with a 48% average graduation rate, 65% average retention rate and an average of 80 days of cash reserved.
Shepherd General Counsel Alan Perdue earlier told lawmakers that he’s skeptical of the CFI’s value. He said factors like debt levels might make the CFI look worse “but might actually reflect a dynamic institution.”
“We felt like we were at a place with where the university is — and the effectiveness, we believe, of our Board of Governors— that it’s appropriate to give full governance authority to that board,” Perdue said, “and provide all the categories of exemption that are provided for in the code for some universities.”
Each college has its own board of governors. The Higher Education Policy Commission, which is supposed to oversee four-year colleges statewide, is led by its own board.
Most of the members of all these boards are appointed by the governor, with the approval of senators.
WVSU is the only school that meets no criteria. It has measurements such as a 31% graduation rate and a 13% enrollment drop. The bill doesn’t count the many high-schoolers taking college courses that have made WVSU’s enrollment seem higher.