2013 Wisconsin Act 20 provided a $5.0 million annual increase in general state aid to technical colleges beginning in fiscal year 2014-15. The Act also required the WTCS Board to:

  • establish a new formula for allocating general state aid to technical colleges based on each college's performance relative to a particular set of criteria;
  • submit the formula for review by the Legislature's Joint Finance Committee by March 31, 2014;
  • apply the formula to 10% of general aid funding for the 2014-15 fiscal year, 20% in 2015-16, and 30% in 2016-17, and distribute the remainder of general aid based on the existing state aid formula;
  • use data for three fiscal years in the formula;
  • allow colleges to identify 7 of the 9 criteria on which to be measured for the purposes of receiving performance funding;
  • submit a report to the Department of Administration, beginning with 2014-15 and annually thereafter, that details the total state general aid appropriation, the amount distributed to each college, the methodology for the distribution, and the colleges' performance in each area of measurement, also making the report available on the agency's and colleges' websites; and
  • include in its biennial budget request any legislative proposals that the Board recommends that relate to the criteria included in the formula.

While Act 20 prescribes specific areas of performance measurement, the WTCS Board and the System President identified key goals for developing the formula, including that it is:

  • efficient, making use of existing data sources to the greatest extent possible;
  • reflective of the colleges' complex missions, which are tied to regional needs and economies;
  • reasonably simple;
  • responsive to the potential need for revision based on experience; and
  • clearly linked to high-value outcomes that support future investment.

WTCS engaged HCM Strategists to assist with the process of developing the performance funding formula. HCM is a nationally-recognized consulting firm based in Washington, D.C., with expertise and considerable experience working with states that are considering or implementing performance funding for higher education. The Lumina and Gates Foundations, among others, provide support for HCM's work in this area.

WTCS also retained consultant Dan Clancy to assist with formula development. Before serving and retiring as WTCS President, Clancy spent 17 years with the Wisconsin Legislative Fiscal Bureau as the state's expert on the complex K-12 school funding formula, overseeing analyses and the development of proposed modifications or alternatives to the model. With WTCS, Clancy had responsibility for administering the state general aid formula, gained experience with performance metrics linked to the System's federal funding, and led the System's transition to outcomes-based strategic planning.