JEFFERSON CITY - A new part of Missouri higher education funding would be based on performance according to a proposal before the legislature's Joint Committee on Education.

Executive director of the committee, Stacey Preis, presented a higher education funding formula proposal including a new section for performance-based funding. 

The committee has until Dec. 31 of next year to decide on a new funding formula for higher education, but after Monday's proposal no details have been ironed out.

Under the proposal, the state would fund 35 percent of operating costs, of which 90 percent would be automatic and the other 10 percent are based on performance standards.

The Senate Appropriations Chair, Sen. Kurt Schaeffer, R-Columbia, said he was concerned about making sure the state has adequate levels of funding for higher education.

"My personal opinion is that we're cutting the pie into too many pieces, which means that everyone gets too small of a piece," Schaeffer said.

Committee Chairman David Pearce, R-Warrensburg, said he is optimistic about the progress despite the fact nothing is decided upon.

"This is a work in progress," Pearce said. "Our deadline was Dec. 31, 2013 and yet I think we're making very good progress."

The proposed budget was created using information from public hearings, reports from previous task forces and committees, colleagues in education policy and research on higher education funding policy.

During her presentation, Preis divided institutional expenditures into six differently calculated sections. Within these sections, schools are placed into one of five different brackets and compared to other higher education institutions, or "sector peers," in the same level. The brackets are broken down by the highest level of education offered and include technical, associate's, baccalaureate, master's and research level schools. This spending encompasses 71 percent of total expenditures for four-year institutions and 64 percent for two-year institutions.

Preis defined the six sections of spending as:

• Instruction: Funding for instruction would be based on credit hours completed and includes weights on credit hours based on difficulty and discipline.
• Research: This section includes research separately budgeted from instruction and would be calculated by taking the school's previous year's spending on research multiplied by 0.25.
• Public Service: This would encompass separately budgeted public service activities that provide non-instructional services to constituents rather than those involved at the institution. This includes activities like community services, conferences and public broadcasting. To calculate what would be appropriated, the median head count of sector peers' public service expenditures would be multiplied by the institution's head count.
• Academic Support: These are activities and services supporting the institution's main mission, such as libraries and computer labs. Spending would be calculated by adding the total for instruction, research and public service and multiplying this number by the median percentage for academic support spending relative to the sum of instruction, research and public service expenditures for the sector peers.
• Student Services: This includes activities contributing to students' emotional and physical well-being as well as their intellectual, cultural and social development outside of classes. It is calculated by taking the median of student services expenditures for sector peers multiplied by institution head count.
• Institutional Support: This includes day-to-day operational support such as central administration, legal and fiscal operations, public relations and development. It's calculated by taking the total of the other five categories listed above multiplied by the median percentage of institutional support expenditures relative to spending in the other five categories of the sector peers.

Legislators and the public are submitting comments and concerns to Preis, and the legislature will be working with this proposal until they can decide on a formula.