AN ACT TO AMEND SECTION 37-101-15, MISSISSIPPI CODE OF 1972, TO ESTABLISH PARAMETERS FOR A NEW, PERFORMANCE-BASED FUNDING MODEL FOR STATE INSTITUTIONS OF HIGHER LEARNING; TO REQUIRE THAT SUCH FUNDING MODEL BE USED TO DISBURSE 75% OF GENERAL FUNDS APPROPRIATED FOR SUCH PURPOSE AND BE IMPLEMENTED BY JULY 1, 2029; TO PROVIDE FOR DISTRIBUTION OF REMAINING FUNDS; TO PROVIDE A 10% PERFORMANCE-BASED HOLDOUT; TO REQUIRE THE FUNDING MODEL TO INCLUDE A BASE APPROPRIATION AND A PERFORMANCE-BASED ALLOCATION; TO PROVIDE MEASURABLE OUTCOMES WHICH SHALL BE CALCULATED USING STANDARDIZED DEFINITIONS ADOPTED BY RULE; TO REQUIRE THE BOARD OF TRUSTEES OF STATE INSTITUTIONS OF HIGHER LEARNING TO ESTABLISH PERFORMANCE STANDARDS, SCORING THRESHOLDS AND VALUES FOR EACH METRIC IN A PUBLICLY NOTICED MEETING ON OR BEFORE JUNE 20, 2026; TO PROVIDE SPECIFIC REQUIREMENTS FOR SUCH STANDARDS, THRESHOLDS AND VALUES; TO PROVIDE FOR DEVELOPING, CALCULATING OR ADMINISTERING THE FUNDING MODEL; TO REQUIRE THE BOARD TO CONTINUOUSLY MONITOR INSTITUTIONAL PERFORMANCE UNDER THE FUNDING MODEL; TO REQUIRE THE BOARD TO IDENTIFY INSTITUTIONS AT RISK OF FAILING TO MEET SPECIFIC STANDARDS; TO AUTHORIZE THE BOARD TO TAKE CERTAIN ACTIONS UPON A DETERMINATION THAT AN INSTITUTION IS AT-RISK; TO REQUIRE THE BOARD TO SUBMIT AN ANNUAL REPORT TO THE LEGISLATURE AND PUBLISH SUCH REPORT ON ITS PUBLIC WEBSITE; TO REQUIRE CERTAIN INFORMATION TO BE INCLUDED IN THE REPORT; TO REQUIRE THE BOARD TO PROMULGATE RULES NECESSARY TO IMPLEMENT THIS ACT; TO REQUIRE THE BOARD TO ADOPT AND PUBLISH THE FUNDING MODEL, INCLUDING ALL METRIC DEFINITIONS, BENCHMARKS AND WEIGHTS, NO LATER THAN JUNE 30, 2026; TO PROVIDE FOR APPLICATION OF THE FUNDING MODEL FOR THE INITIAL THREE FISCAL YEARS FOLLOWING ADOPTION AND PUBLICATION; TO REQUIRE FULL IMPLEMENTATION OF THE FUNDING MODEL BY JULY 1, 2029; TO PROHIBIT THE BOARD FROM PERMITTING A PERSON SUBJECT TO THE REGISTRATION REQUIREMENTS UNDER SECTIONS 45-33-21 THROUGH 45-33-63 TO RESIDE IN A DORMITORY OR OTHER STUDENT LIVING ACCOMMODATION LOCATED ON THE CAMPUS OF OR MANAGED BY A STATE INSTITUTION OF HIGHER LEARNING; TO BRING FORWARD SECTIONS 37-101-1, 37-101-2, 37-101-3, 37-101-4, 37-101-5, 37-101-7, 37-101-9, 37-101-11, 37-101-13, 37-101-16, 37-101-19, 37-101-21, 37-101-23, 37-101-25, 37-101-29 AND 37-101-30, MISSISSIPPI CODE OF 1972, WHICH GOVERN THE INSTITUTIONS OF HIGHER LEARNING, FOR PURPOSE OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
The implementation of this bill will have a significant impact on state laws governing educational funding and institutional operations. The Board of Trustees of State Institutions of Higher Learning will be responsible for developing and administering the new funding model, which will require precise metrics for assessing institutional performance. This shift toward a performance-oriented funding approach aims to motivate institutions to improve educational outcomes and support students’ success in completing their degrees. It may also redirect financial resources to institutions that perform better according to the established standards, thereby potentially reshaping the competitive landscape among Mississippi's colleges and universities.
Senate Bill 2523 aims to reform the funding structure for state institutions of higher learning in Mississippi by introducing a new performance-based funding model. The bill mandates that by July 1, 2029, at least 75% of general funds appropriated for operating expenses be disbursed according to this model. The design of the model includes a base appropriation and a performance-based allocation linked to measurable outcomes that focus on student attainment, degree completion, and other critical educational metrics. Furthermore, a performance holdout of 10% of the operating funds would be subject to institutions meeting specific performance standards.
Sentiment surrounding SB2523 appears to be mixed among lawmakers and stakeholders in the education sector. Proponents argue that tying funding to performance will ensure accountability and encourage higher education institutions to focus on student success and operational efficiency. Critics, however, express concern that such a model may disproportionately disadvantage institutions serving lower-income or underrepresented students, who may face more barriers to achieving the desired outcomes. This debate highlights concerns about creating equitable educational opportunities across the different institutions in the state.
A notable point of contention in the discussions surrounding SB2523 revolves around the definition and establishment of performance metrics. Critics worry that certain metrics, particularly those solely based on graduation rates or degree completions, do not accurately reflect the challenges faced by diverse student populations. Additional issues arise regarding the legislative authority and oversight of the Board of Trustees as they develop and implement these standards, with concerns that existing disparities in institutional resources may exacerbate inequalities in education funding.