An ambitious performance-based funding model for community colleges in Texas outperformed all expectations in its first three years. Student success metrics at Texas community colleges skyrocketed with credential attainment and dual-enrollment rates surpassing the state’s projections. But now, the program is suffering from its own success.
Three years ago, Texas celebrated the launch of the new funding model, which was widely applauded by state policymakers and community college leaders for its careful design to reward colleges for improving student outcomes aligned with state priorities.
But the state didn’t appropriate enough funding to pay for the gains, thrusting colleges into financial uncertainty. Forty-two of the state’s 50 community college districts could face funding reductions for fiscal year 2027, according to calculations by the state. For some, that would mean multimillion-dollar shortfalls.
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