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Second Regular Session
Seventy-fifth General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 26-0473.01 Jacob Baus x2173 HOUSE BILL 26-1345
House Committees Senate Committees
Education
A BILL FOR AN ACT
CONCERNING HIGHER EDUCATION FUNDING , AND , IN CONNECTION101
THEREWITH, IMPLEMENTING THE RECOMMENDATIONS IN THE102
REPORT ON THE HIGHER E DUCATION FUNDING ALLOCATION103
FORMULA.104
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill w ill be av ailable at
http://leg.colorado.gov.)
The bill changes the higher education funding provisions, effective
for the 2027-28 state fiscal year.
Under current law, a state institution of higher education's
HOUSE SPONSORSHIP
McCluskie and Hamrick,
SENATE SPONSORSHIP
Coleman and Simpson,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law.
governing board's annual fee-for-service contract includes funding
calculated based on 3 components: Ongoing additional funding,
performance funding, and temporary additional funding. The bill:
! Changes the name of the funding from "performance
funding" to "results-informed funding";
! Redefines some of the terms and metrics that are used to
determine results-informed funding; and
! Reorders the components and eliminates current statutory
language that requires sequential calculation of the
components.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 23-18-302, amend2
(4)(b), (8), (9), (10), (14), and (17); repeal (18); and add (2.5), (11.5),3
and (21.5) as follows:4
23-18-302. Definitions - repeal.5
As used in this part 3, unless the context otherwise requires:6
(2.5) (a) "CO-LOCATED DEGREE PARTNERSHIP" MEANS A PROGRAM7
FORMALIZED BY A WRITTEN AGREEMENT BETWEEN TWO INSTITUTIONS IN8
WHICH:9
(I) A STUDENT IS ENROLLED AS A DEGREE -SEEKING STUDENT AT10
THEIR HOME INSTITUTION IN A DEGREE PROGRAM THAT IS NOT OFFERED TO11
COMPLETION AT THEIR HOME INSTITUTION;12
(II) THE STUDENT SUBSEQUENTLY MATRICULATES AS A TRANSFER13
AND DEGREE-SEEKING STUDENT AT A PARTNER INSTITUTION THAT OFFERS14
THE DEGREE PROGRAM TO COMPLETION THAT THE STUDENT 'S HOME15
INSTITUTION DOES NOT OFFER TO COMPLETION; AND16
(III) F OR A PERIOD OF TIME , AS DEFINED BY THE AGREEMENT17
BETWEEN THE TWO INSTITUTIONS, THE STUDENT CONTINUES TO PRIMARILY18
BE LOCATED AT THE HOME INSTITUTION'S CAMPUS, INCLUDING RECEIVING19
INSTRUCTION, ACADEMIC SERVICES , LIBRARY ACCESS , OR STUDENT20
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SUPPORT SERVICES FROM THE HOME INSTITUTION.1
(b) "CO-LOCATED DEGREE PARTNERSHIP" DOES NOT INCLUDE:2
(I) A N ARTICULATION PATHWAY WITHOUT A CO -LOCATION3
DELIVERY COMPONENT , INCLUDING A STATEWIDE , BILATERAL OR4
MULTILATERAL TRANSFER AGREEMENT;5
(II) GENERAL TRANSFER PARTNERSHIPS;6
(III) CROSS-REGISTRATION OR COURSE-SHARING PARTNERSHIPS,7
INCLUDING ONLINE-ONLY COURSE ARRANGEMENTS;8
(IV) C ONCURRENT OR DUAL ENROLLMENT WITHOUT A9
CO-LOCATION DELIVERY COMPONENT; OR10
(V) ANY PROGRAM IN A DEGREE PROGRAM THAT IS OFFERED TO11
COMPLETION AT THE STUDENT'S HOME INSTITUTION.12
(c) T HE DEPARTMENT SHALL ENSURE THAT THE GOVERNING13
BOARDS COLLECT AND REPORT THE DATA IN A CONSISTENT MANNER.14
(4) "Credential completion" means the calculation of student15
credential completion by a governing board based on equal weighting of16
the total resident student completions of postsecondary credentials in a17
given state fiscal year. The credential completion calculation includes:18
(b) Equal weighting for a resident student who transfers out of an19
institution with a community college role and mission specified in statute,20
after accumulating at least eighteen credit hours at the institution in a21
two-year degree program AND TRANSFERRING WITHIN THE NEXT22
ACADEMIC YEAR INTO ANOTHER INSTITUTION, AREA TECHNICAL COLLEGE,23
OR LOCAL DISTRICT COLLEGE.24
(8) "One-hundred-fifty-percent-of-time graduation rate" means,25
for a four-year institution, the percentage of first-time, full-time,26
degree-seeking undergraduate students starting in the fall term and27
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graduating within six years with a bachelor's degree from the same1
institution, and, for a two-year institution, the percentage of first-time,2
full-time, associate degree-seeking or undergraduate certificate-seeking3
students starting in the fall term and completing their declared program4
within one hundred fifty percent of the normal time to completion, as5
reported to the integrated postsecondary education data system6
maintained by the federal department of education. If the integrated7
postsecondary education data system does not include data for an8
institution or governing board for prior state fiscal years, the department9
shall use its available data, as reported by the governing board to the10
department through the student-unit record database, in place of the11
missing integrated postsecondary education data system data12
DEPARTMENT. The department shall ensure that the governing boards13
collect and report the data in a consistent manner. A student may be14
counted only once in a state fiscal year for purposes of this performance15
RESULTS-INFORMED funding metric. S TUDENTS ENROLLED IN A16
CO-LOCATED DEGREE PARTNERSHIP ARE NOT INCLUDED IN THE COHORTS17
THAT DETERMINE THE ONE -HUNDRED -FIFTY -PERCENT -OF-TIME18
GRADUATION RATE.19
(9) "One-hundred-percent-of-time graduation rate" means, for a20
four-year institution, the percentage of first-time, full-time,21
degree-seeking undergraduate students starting in the fall term and22
graduating within four years with a bachelor's degree from the same23
institution, and, for a two-year institution, the percentage of first-time,24
full-time, associate degree-seeking or undergraduate certificate-seeking25
students starting in the fall term and completing their declared program26
within one hundred percent of the normal time to completion, as reported27
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to the integrated postsecondary education data system maintained by the1
federal department of education. If the integrated postsecondary2
education data system does not include data for an institution or3
governing board for prior state fiscal years, the department shall use its4
available data, as reported by the governing board to the department5
through the student-unit record database, in place of the missing6
integrated postsecondary education data system data DEPARTMENT. The7
department shall ensure that the governing boards collect and report the8
data in a consistent manner. A student may be counted only once in a9
state fiscal year for purposes of this performance RESULTS-INFORMED10
funding metric. S TUDENTS ENROLLED IN A CO -LOCATED DEGREE11
PARTNERSHIP ARE NOT INCLUDED IN THE COHORTS THAT DETERMINE THE12
ONE-HUNDRED-PERCENT-OF-TIME GRADUATION RATE.13
(10) "Pell-eligible "P ELL-RECIPIENT student" means an14
undergraduate student who qualifies for RECEIVES the federal Pell grant15
or for a grant through a successor program.16
(11.5) "P REVIOUS SHARE " MEANS THE PERCENTAGE SHARE OF17
FUNDING APPROPRIATED TO EACH GOVERNING BOARD FROM THE TOTAL18
AMOUNT APPROPRIATED IN THE PRECEDING STATE FISCAL YEAR PURSUANT19
TO SECTIONS 23-18-202 AND 23-18-303.5, EXCLUDING THE AMOUNT20
APPROPRIATED PURSUANT TO SECTION 23-18-303.5 (3).21
(14) "Resident Pell-eligible P ELL-RECIPIENT UNDERGRADUATE22
student population share" means the resident Pell-eligible PELL-RECIPIENT23
UNDERGRADUATE student head count as a percentage of the overall24
resident UNDERGRADUATE student population head count, EXCLUDING25
CONCURRENT ENROLLMENT, AS DEFINED IN SECTION 22-35-103, from the26
end-of-term fall enrollment collected by the department.27
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(17) "Retention rate" means, for a four-year institution, the1
percentage of first-time, full-time OR FIRST -TIME, PART -TIME2
undergraduate students starting in the fall term and returning for their3
second fall term at the same institution, and, for a two-year institution, the4
percentage of first-time, full-time OR FIRST-TIME, PART-TIME associate5
degree-seeking or undergraduate certificate-seeking students starting in6
the fall term and either returning for or successfully completing their7
declared program by the second fall term at the same institution, as8
reported to the integrated postsecondary education data system9
maintained by the federal department of education. If the integrated10
postsecondary education data system does not include data for an11
institution or governing board for prior state fiscal years, the department12
shall use its available data, as reported by the governing board to the13
department through the student-unit record database, in place of the14
missing integrated postsecondary education data system data15
DEPARTMENT. The department shall ensure that the governing boards16
collect and report the data in a consistent manner. A student may be17
counted only once in a state fiscal year for purposes of this performance18
RESULTS-INFORMED funding metric.19
(18) (a) "Role and mission share" means the percentage share of20
funding appropriated to each governing board of the total amount21
appropriated in the preceding state fiscal year pursuant to sections22
23-18-202 and 23-18-303.5, excluding the amount appropriated pursuant23
to section 23-18-303.5 (3).24
(b) Repealed.25
(21.5) "TOTAL PREVIOUS ADJUSTED SHARE" MEANS THE TOTAL OF26
THE PREVIOUS ADJUSTED SHARES FOR ALL GOVERNING BOARDS , AS27
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DESCRIBED IN SECTION 23-18-303.5 (1.5)(c).1
SECTION 2. In Colorado Revised Statutes, 23-18-303.5, amend2
(1)(a), (2) introductory portion, (2)(a), (3), and (7); repeal (4), (5), and3
(8); and add (1.3) and (1.5) as follows:4
23-18-303.5. Fee-for-service contracts - authorization -5
results-informed funding.6
(1) (a) For the 2021-22 2027-28 state fiscal year and each state7
fiscal year thereafter, the governing board of a state institution of higher8
education may annually negotiate a fee-for-service contract with the9
department pursuant to this section for the delivery of higher education10
services by the institution for the benefit of the state and its residents.11
Specialty education programs, area technical colleges, and local district12
colleges are funded pursuant to the provisions of section 23-18-304.13
(1.3) Results-informed funding metrics.14
(a) T HE COMMISSION, IN CONJUNCTION WITH THE DEPARTMENT15
AND IN COLLABORATION WITH THE GOVERNING BOARDS , SHALL16
CALCULATE RESULTS-INFORMED FUNDING FOR EACH GOVERNING BOARD17
BASED ON THE RATE OF CHANGE OVER TIME IN THE PERFORMANCE OF THE18
INSTITUTIONS OVERSEEN BY THE GOVERNING BOARD ON THE19
RESULTS-INFORMED FUNDING METRICS SPECIFIED IN SUBSECTION (1.3)(b)20
OF THIS SECTION . THE RECOMMENDATION FOR RESULTS -INFORMED21
FUNDING MAY REFLECT A CHANGE IN THE TOTAL STATE APPROPRIATION,22
LESS THE AMOUNT APPROPRIATED PURSUANT TO SUBSECTION (3) OF THIS23
SECTION FROM THE PRECEDING STATE FISCAL YEAR.24
(b) THE RESULTS-INFORMED FUNDING METRICS INCLUDE:25
(I) RESIDENT STUDENT FULL-TIME EQUIVALENT ENROLLMENT;26
(II) CREDENTIAL COMPLETION;27
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(III) R ESIDENT PELL-RECIPIENT UNDERGRADUATE STUDENT1
POPULATION SHARE;2
(IV) R ESIDENT UNDERREPRESENTED MINORITY STUDENT3
POPULATION SHARE;4
(V) RETENTION RATE;5
(VI) ONE-HUNDRED-PERCENT-OF-TIME GRADUATION RATE;6
(VII) ONE-HUNDRED-FIFTY-PERCENT-OF-TIME GRADUATION RATE;7
AND8
(VIII) RESIDENT FIRST-GENERATION UNDERGRADUATE STUDENT9
POPULATION SHARE.10
(c) (I) IN PREPARING ANNUAL BUDGET RECOMMENDATIONS, THE11
COMMISSION, IN CONJUNCTION WITH THE DEPARTMENT AND IN12
COLLABORATION WITH THE GOVERNING BOARDS , MAY ANNUALLY13
IDENTIFY THE PORTION OF TOTAL RESULTS -INFORMED FUNDING THAT IS14
ALLOCATED TO EACH RESULTS-INFORMED FUNDING METRIC SPECIFIED IN15
SUBSECTION (1.3)(b) OF THIS SECTION.16
(II) T HE JOINT BUDGET COMMITTEE , AFTER CONSIDERING THE17
COMMISSION'S ANNUAL BUDGET RECOMMENDATIONS, SHALL DETERMINE18
THE PORTION OF TOTAL RESULTS-INFORMED FUNDING FOR THE APPLICABLE19
STATE FISCAL YEAR THAT IS ALLOCATED TO EACH RESULTS -INFORMED20
FUNDING METRIC SPECIFIED IN SUBSECTION (1.3)(b) OF THIS SECTION .21
EACH GOVERNING BOARD'S SHARE OF THE FUNDING ALLOCATED FOR EACH22
RESULTS-INFORMED FUNDING METRIC IS DETERMINED USING THE23
CALCULATION SET FORTH IN SUBSECTION (1.5) OF THIS SECTION.24
(1.5) Results-informed funding - lever one.25
(a) T HE AMOUNT OF RESULTS -INFORMED FUNDING THAT A26
GOVERNING BOARD RECEIVES FOR EACH RESULTS -INFORMED FUNDING27
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METRIC SPECIFIED IN SUBSECTION (1.3)(b) OF THIS SECTION IS BASED ON1
THE RATE OF CHANGE OVER TIME IN THE PERFORMANCE OF THE2
INSTITUTIONS OVERSEEN BY THE GOVERNING BOARD ON THE3
RESULTS-INFORMED FUNDING METRIC.4
(b) THE RATE OF CHANGE FOR EACH RESULTS-INFORMED FUNDING5
METRIC IS CALCULATED ANNUALLY FOR A GOVERNING BOARD BY DIVIDING6
THE AVERAGE OF THE FOUR MOST RECENT YEARS OF ACTUAL DATA7
REPORTED BY THE GOVERNING BOARD FOR THE RESULTS -INFORMED8
FUNDING METRIC BY THE AVERAGE OF THE THREE OLDEST OF THE FOUR9
YEARS OF ACTUAL DATA REPORTED BY THE GOVERNING BOARD FOR THE10
RESULTS-INFORMED FUNDING METRIC.11
(c) THE RATE OF CHANGE FOR THE RESULTS -INFORMED FUNDING12
METRIC IS THEN MULTIPLIED BY EACH GOVERNING BOARD 'S PREVIOUS13
SHARE, RESULTING IN THE GOVERNING BOARD 'S PREVIOUS ADJUSTED14
SHARE FOR THE RESULTS-INFORMED FUNDING METRIC. THE TOTAL OF THE15
PREVIOUS ADJUSTED SHARES FOR ALL GOVERNING BOARDS IS THE TOTAL16
PREVIOUS ADJUSTED SHARE FOR THE RESULTS -INFORMED FUNDING17
METRIC.18
(d) E ACH GOVERNING BOARD 'S ALLOCATION FOR THE19
RESULTS-INFORMED FUNDING METRIC IS DETERMINED BY DIVIDING THE20
GOVERNING BOARD 'S PREVIOUS ADJUSTED SHARE FOR THE21
RESULTS-INFORMED FUNDING METRIC BY THE TOTAL PREVIOUS ADJUSTED22
SHARE FOR THE RESULTS -INFORMED FUNDING METRIC , ENSURING THAT23
THE TOTAL AMOUNT OF FUNDING DISTRIBUTED THROUGH THE24
RESULTS-INFORMED FUNDING METRIC DOES NOT EXCEED THE AMOUNT OF25
FUNDING ALLOCATED FOR THE RESULTS-INFORMED FUNDING METRIC.26
(2) Ongoing performance funding - lever two. Prior to27
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calculating performance funding recommendations pursuant to subsection1
(4) of this section, The commission, in conjunction with the department2
and in collaboration with the governing boards, may recommend an3
additional amount of funding pursuant to this subsection (2) for an4
institution, which amount is ongoing base PERFORMANCE funding for the5
receiving institution and is included in the calculation of funding pursuant6
to this part 3 in subsequent state fiscal years. The commission may7
recommend an additional amount of funding for the following purposes:8
(a) To increase appropriations over the previous state fiscal year9
in order to make progress toward master plan goals, which may include10
addressing base PERFORMANCE funding disparities, HISTORIC INEQUITIES,11
THE UNIQUE ROLE OF AREA TECHNICAL COLLEGES, or funding priorities not12
addressed through the performance RESULTS-INFORMED funding metrics.13
The commission shall focus its recommendations on broad institutional,14
systemwide, or state policy goals.15
(3) One-time investments - lever three. After calculating16
funding recommendations pursuant to subsections (2) and (4) of this17
section, The commission, in conjunction with the department and in18
collaboration with the governing boards, may recommend an additional19
amount of temporary funding pursuant to this subsection (3) for an20
institution for purposes of making progress toward goals identified in the21
systemwide master planning process set forth in section 23-1-108 or other22
areas as identified by the commission. Additional funding received23
pursuant to this subsection (3) must be allocated for a specific period of24
time, is not ongoing base funding, and is not included in the calculation25
of funding pursuant to this part 3 in subsequent state fiscal years or in the26
calculation of the total state appropriation made pursuant to this part 3.27
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(4) Performance funding metrics.1
(a) After calculating funding recommendations pursuant to2
subsection (2) of this section, the commission, in conjunction with the3
department and in collaboration with the governing boards, shall calculate4
performance funding for each governing board based on the rate of5
change over time in the performance of the institutions overseen by the6
governing board on the performance funding metrics specified in7
subsection (4)(b) of this section. The recommendation for performance8
funding may reflect a change in the total state appropriation, less the9
amount appropriated pursuant to subsection (3) of this section, from the10
preceding state fiscal year.11
(b) The performance funding metrics include:12
(I) Resident student full-time equivalent enrollment;13
(II) Credential completion;14
(III) Resident Pell-eligible student population share;15
(IV) Resident underrepresented minority student population share;16
(V) Retention rate;17
(VI) One-hundred-percent-of-time graduation rate;18
(VII) One-hundred-fifty-percent-of-time graduation rate; and19
(VIII) Resident first-generation undergraduate student population20
share.21
(c) (I) Beginning with the 2021-22 state fiscal year, in preparing22
budget recommendations, the commission, in conjunction with the23
department and in collaboration with the governing boards, may annually24
identify the portion of total performance funding that is allocated to each25
performance funding metric specified in subsection (4)(b) of this section.26
(II) For the 2021-22 state fiscal year and each state fiscal year27
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thereafter, the joint budget committee, after considering the commission's1
budget recommendations, shall determine the portion of total2
performance funding for the applicable state fiscal year that is allocated3
to each performance funding metric specified in subsection (4)(b) of this4
section. Each governing board's share of the funding allocated for each5
performance funding metric is determined using the calculation set forth6
in subsection (5) of this section.7
(5) Performance funding calculation.8
(a) The amount of performance funding that a governing board9
receives for each performance funding metric specified in subsection10
(4)(b) of this section is based on the rate of change over time in the11
performance of the institutions overseen by the governing board on the12
performance funding metric. The rate of change for each performance13
funding metric is calculated annually for a governing board by dividing14
the average of the four most recent years of actual data reported by the15
governing board for the metric by the average of the three oldest of the16
four years of actual data reported by the governing board for the metric.17
The rate of change for the performance funding metric is then multiplied18
by each governing board's role and mission share, resulting in the19
"governing board role and mission adjusted share" for the performance20
funding metric. The total of the governing board role and mission21
adjusted shares for all governing boards is the "total role and mission22
adjusted share" for the performance funding metric. Each governing23
board's allocation for the performance funding metric is then determined24
by dividing the governing board's role and mission adjusted share for the25
performance funding metric by the total role and mission adjusted share26
for the performance funding metric, ensuring that the total amount of27
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funding distributed through the performance funding metric does not1
exceed the am ount of f unding allocated for the performance funding2
metric.3
(b) Repealed.4
(7) When requesting or determining a change in performance5
RESULTS-INFORMED funding pursuant to subsection (4) SUBSECTION (1.5)6
of this section and tuition spending authority for governing boards, the7
department and the joint budget committee shall consider, at a minimum,8
cost increases to base funding at all institutions, including those related9
to common policies annually submitted in the governor's November 110
budget request and adopted by the joint budget committee, and the11
commission's master plan goals.12
(8) The board of trustees of the Colorado school of mines may13
study and recommend to the general assembly a different funding14
structure, including but not limited to a special purpose authority as15
defined in section 24-77-102 (15), that strengthens the institution and its16
specialized educational programs while ensuring academic quality and17
continued opportunities for resident students who meet the admissions18
criteria of the institution.19
SECTION 3. In Colorado Revised Statutes, 23-18-306, amend20
(1)(a) introductory portion, (1)(a)(II)(A), and (1)(a)(II)(B); and repeal (4)21
as follows:22
23-18-306. Duties and powers of the commission - budget23
provisions - periodic review of funding formula - report.24
(1) (a) For the 2021-22 state fiscal year 2027-28 STATE FISCAL25
YEAR and each state fiscal year thereafter, the department and commission26
shall submit a budget request by November 1 of each year that includes:27
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(II) Recommendations for:1
(A) Changes in the amount of performance RESULTS-INFORMED2
funding pursuant to section 23-18-303.5 (4) SPECIFIED IN SECTION3
23-18-303.5 (1.5), if any;4
(B) The percentage allocation of performance RESULTS-INFORMED5
funding among the performance RESULTS-INFORMED funding metrics6
specified in section 23-18-303.5 (4)(b) SECTION 23-18-303.5 (1.3);7
(4) The commission, in conjunction with the department and in8
collaboration with the governing boards, shall identify and make9
recommendations concerning ways to better measure the success of10
students who are pursuing a credential or degree and who are not included11
in the first-time, full-time student cohort. On or before July 1, 2022, the12
commission shall submit its recommendations to the joint budget13
committee, which may include a recommendation for a statutory change14
to the calculation of one of the graduation rate performance funding15
metrics specified in section 23-18-303.5 (4)(b).16
SECTION 4. Effective date - applicability. This act takes effect17
August 1, 2026, and applies to state institution of higher education18
budgets beginning in state fiscal year 2027-28.19
SECTION 5. Safety clause. The general assembly finds,20
determines, and declares that this act is necessary for the immediate21
preservation of the public peace, health, or safety or for appropriations for22
the support and maintenance of the departments of the state and state23
institutions.24
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