Louisiana Board of Regents outlines new higher education funding formula for 2026

In a recent meeting held by the Louisiana Appropriations Committee on April 14, 2025, key discussions centered around adjustments to statewide services and the funding formula for higher education. The meeting highlighted significant financial changes that could impact various educational institutions across the state.

One of the most notable adjustments discussed was a decrease in risk management premiums by $8.9 million. Additionally, a market rate pay increase for classified employees was set at $6.6 million, while group benefits for both active employees and retirees saw an increase of $7.2 million. These changes reflect ongoing efforts to manage state resources effectively while addressing employee compensation and benefits.

The committee also reviewed the higher education funding formula, which has undergone several revisions since its inception. Established under Act 462 during the 2014 regular session, the formula is designed to allocate funds based on performance metrics. The current formula, adopted for fiscal year 2026, consists of a 65% base funding component and a 35% outcomes-based component. This shift aims to incentivize institutions to improve student outcomes, including graduation rates and enrollment in high-demand fields.

Enrollment trends were another focal point of the meeting. The Louisiana State University (LSU) system reported an increase in fall enrollment from 52,146 in 2020 to 64,905 in 2024. Similarly, the Southern University System also experienced growth, with enrollment rising from 11,006 to 13,006 during the same period. In contrast, the University of Louisiana System saw a decline in enrollment, dropping from 90,947 to 83,665. The Louisiana Community and Technical College System, however, reported an overall increase in enrollment, rising from 52,604 to 57,674, despite some institutions facing declines.

The committee's discussions underscored the importance of adapting funding strategies to meet the evolving needs of Louisiana's educational landscape. With tuition and fees remaining stable since 2016, the focus on enrollment and performance metrics may play a crucial role in shaping future funding decisions.

As the committee continues to refine its approach to higher education funding, the implications of these discussions will likely resonate throughout the state's educational institutions, influencing both policy and student outcomes in the years to come.