Schools
 

Is TOPS doomed? No, but sharp course correction needed to avoid Titanic’s fate

The Titanic is portrayed on a postcard in circulation two years after "unsinkable" ship was done in by an iceberg.

Queensland State Library

The Titanic is portrayed on a postcard in circulation after the "unsinkable" ship was done in by an iceberg. For TOPS, the iceberg ahead is the inflation of college costs.

The Titanic was the grandest ship of its time. Perhaps the only thing more astonishing than the ship itself was its demise. How could a ship so large and “unsinkable” meet such a tragic fate? The legacy of the Titanic leaves an important lesson: Be on the lookout for icebergs.

The TOPS program may lack the grandeur of the Titanic, but it’s a strong source of pride for the people of Louisiana — or should be. TOPS puts approximately 15,000 of our sons and daughters through school annually, yours truly having been among the recent beneficiaries. It’s something to tout in a state that so often falls behind when it comes to education.

Here’s the bad news: The program is headed straight for an iceberg. To save TOPS for the next generation we must change course immediately.

What I am suggesting are a few small changes that will greatly assist the program in becoming efficient, competitive, and strong — adjectives that would be nice to have associated with Louisiana for a change.

TOPS, launched in 1989 at the initiative of the late oilman Patrick Taylor, essentially covers tuition and some fees for any qualified Louisiana high school graduate enrolling in a state college or technical school. When times are good, it has been financed through the state’s General Fund; more recently TOPS has tapped a state trust fund set up with proceeds from the tobacco settlement. In a nutshell, the problem is that the General Fund is maxed out and trust fund money will begin to dwindle so fast that the program will founder and sink in just a couple decades if no action is taken.

The reason? Inflation. During the latest budget crunch, the state has cut funding for higher education to keep the budget above water, and the state’s colleges and universities have been allowed to raise tuition to help bridge the gap. This has caused the overall cost of the TOPS program to rise an average of approximately 11 percent per year from 2007-2012, with no sign of slowing down. A program that cost $139 million in 2010 will have skyrocketed to a projected $177 million by the end of this year.

Fortunately, there is still time to act. I have great admiration for TOPS, and have spent the better part of the last year and a half studying, researching and formulating a plan to save it. The plan is balanced, innovative and will be effective.

First, stipends on top of tuition should be eliminated. These $800 and $400 stipends are given yearly to students who achieve a higher ACT score. They go overwhelmingly to the most fortunate students who can otherwise afford the extra costs of college. The result of eliminating such stipends would save $11.5 million per year, or $115 million over a decade.

Next, we must continue to strive for excellence and to demand more of our students — they’re undoubtedly capable of it — by requiring a 21 on the ACT for admission to the program. This is only a one-point increase over the current requirement of 20 and would save $300 million over the next decade.

Lastly, students who accept the scholarship but do not finish their degree will be required to repay the award with interest. Of course, exceptions will be made for severe hardship and military service. The TOPS award is a contract between student and state, and the student is responsible for following through with graduation. Savings from this reform would amount to $159 million over the next decade (with non-payers estimated at 15 percent of TOPS dropouts).

At this point, we have not done much to change the program, but in a balanced manner have saved more than half a billion dollars — $575 million.

However, that iceberg of inflation still looms large.

The green line represents the projected costs of an unreformed TOPS program if inflation continues at 5% per year.  The initially solid red line that fades into the dotted red line is spending projection if the three small reforms are implemented, without restructuring the program to control inflation. The solid red line is the projection if all proposals are implemented.

Dane Harris

The green line represents the projected costs of an unreformed TOPS program if inflation continues at 5% per year. The initially solid red line that fades into the dotted red line is spending projection if the three small reforms are implemented, without restructuring the program to control inflation. The solid red line is the projection if all proposals are implemented.

How will we ultimately save the ship? Over time, after the above reforms have kicked in, TOPS will be transformed into a competitive market-based program forcing colleges and universities  to compete for students. Schools will be given control over the allocation of their own TOPS funds and will be held accountable for the results.

Schools will begin with the same proportion of overall TOPS funding that they have enjoyed historically. They will be allowed to offer the money to Louisiana residents in any amount up to the full cost of tuition. Students will receive offers from competing colleges and they will choose what makes the most sense for them.

The academic recruiting process will more closely resemble the athletic recruiting process that allows student-athletes to weigh offers against one another, as they seek out the best deal. Because schools will decide whom to offer scholarships — based on grades, test scores, diversity and other factors — a minimum test score will no longer be the sole criterion. The change will be all-inclusive; no student will be disqualified from TOPS because they scored poorly on a single test.

The trade-off is that not all participating students will be guaranteed full tuition; they will receive what their performance merits. They will, however, be guaranteed a free ride at a trade or professional school. This will funnel students toward the two-year community colleges that fuel Louisiana’s industrial economy.

As for the colleges and universities, they will be ranked according to an efficiency formula made up of factors such as college rankings from national publications, peer reviews, graduation rates, student evaluations and other factors. As an institution rises or falls in the rankings, it will gain or lose its percentage of TOPS funding. Efficient schools will be rewarded; struggling schools will be gradually weaned off the state dole.

Louisiana will come out of the transformation with stronger, more competitive schools.

TOPS funds will be allowed to grow in pace with overall inflation as measured by the federal government’s Consumer Price Index, not by the current 10 percent rate at which tuitions have soared. But ambitious colleges and universities will have discretion over funding in ways that allow them to build programs that have a shot at national prominence. For example, a school that feels it has a competitive advantage in engineering will offer available funds to strong students in that field, leaving competing colleges and universities to develop centers of excellence in other disciplines. Not only does this kind of specialization carry the prospect of national prominence for well-nurtured departments, it provides another potential benefit: paring back the abundance of duplicate programs that are an inefficient drain on Louisiana’s system of higher education.

Change is in the air. In his own effort to make higher education more affordable, President Obama recently suggested a ranking system for colleges and universities much like the one I have just described. His ideas, like mine, should be palatable to both liberals and conservatives. The savings in my plan come both from small cuts in benefits that chiefly go to the most advantaged and by incentivizing market-based competition among colleges and their departments. Louisiana can lead the nation with this innovative model.

And if we don’t? Ready the lifeboats!

Dane Harris, a commercial credit analyst, is an alumnus of Louisiana Tech University with a master’s degree in international business from Germany’s Munich Business School.  His ideas on saving TOPS are developed at greater length in his master’s thesis. For the full 80-page report, email d.c.harris028@gmail.com

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  • NJB

    Enjoyed this article and agree very much with the proposal. One of the main things I like about it is it doesn’t get into typical class warfare mantra like some Louisiana politicos, who want the fix to be denying TOPS to any students whose parents make over a certain income.

    One minor change to this proposal I would offer…being that admission standards to get into LSU is a 22 on the ACT, that should probably be the minimum ACT requirement to receive TOPS.
    Again, good article. Let’s see if the Governor and enough Legislators have the political will to make such common sense changes.

  • MM

    Stronger, more competitive schools are exactly what Louisiana needs, and I’m excited about this proposal to save TOPS! Excellent, well-thought research and ideas.

    Re. NJB’s thoughts, it is my understanding that the second part of reforms, putting TOPS funds allocation in the hands of the schools would address the minimum ACT requirement. A merit based award would take into account ACT scores, and those with scores lower than required for colleges like LSU still get a free-ride to trade/professional school.

    I hope this proposal continues to.gain traction– its high time for the TOPS Titanic-story to have a happy ending!

  • Dane Harris

    NJB,
    Thank you for the kind words about my proposals. I specifially designed my reforms to accomplish what you mentioned–something that would avoid class and partisan warfare and be palatable to all parties. I think I accomplished this.
    One thing I would like to clarify: As colleges would be allowed to distribute their portion of TOPS money in any amount to any Louisiana student, a minimum ACT score would no longer be necessary. Taking your example, there is no need for a minimum of a 22 for TOPS because LSU won’t be able to admit them with a 21 anyway, correct? The effective minimum is already a 22 for LSU.
    However under my plan, the minimum ACT will be eliminated altogether. If a school wants to offer a student with a 19 ACT a half scholarship, that school should be allowed to do that. They will do so knowing that their success and improvement will be scored along the lines that I illustrated, so this will provide a check and balance system that will keep standards high. This plan encourages competition, eliminates duplicate programs and waste, builds up Centers of Excellence and tells no student “no” based on one sole factor. It is all-inclusive.
    Again, thanks for the kind words. Please feel free to contact me with any further questions or comments.Together we can help reform TOPS.

  • Holly

    does the change mean that a student who completed all the TOPS requirements could possibly not be able to get into the college of their choice?

  • Dane Harris

    Holly,

    It doesn’t mean that they won’t get into their college of choice, but it could mean that they don’t get a guaranteed full scholarship from that school. However, they might get a half scholarship, or any other amount. Perhaps another school will offer them more money and they will change their choice of schools.

    The state cannot continue to offer guaranteed full scholarships to any school and guarantee unlimited TOPS funds to the schools, as the article and chart illustrate (that is the path to the iceberg). The question becomes, what is the most fair and efficient way to allocate our limited funds in a sustainable manner?

    Doing it this way will result in efficient use of state funds (by placing talented students in the best programs in their field) and by causing some students not committed to college to consider other career routes (trade school, for free). No student that is competitive across the board will lose their school of choice, and some students will be more competitive due to factors that don’t show up on test scores.

  • Gretchen1999

    If graduation rates are a piece of the pie, what effect do you think this proposal will have on the continuing increase of inflated grades and watered down courses? As a 40 year veteran teacher, I have watch the increase in the numbers of remedial math and English classes needed, the increase in the number of students who cannot write a complete sentence or solve a third grade arithmetic problem, and the increase in pressure on teachers to “increase retention rates” which has resulted in teachers passing students who have not mastered the concepts in an effort to appease administrators and to “look good” in reports. It is an academic farce to say the least. A large part of the problem is a combination of a sense of entitlement on the part of students and their parents as well along with more students who are “academically challenged” and do not belong in college. Send them to technical schools and train them for a job, but do not require them to master College Algebra (which is actually high school algebra) or write an essay (they can’t even write an email correctly)!

  • Dane Harris

    Gretchen, thank you for noticing that, and for spending 40 years teaching out students. Grade inflation is a huge problem, and will continue to be with the current system. As the system works now with the Grad Act, schools must keep their retention rate high to be allowed to raise tuition. It is currently working exactly as you mentioned.

    As for my ranking system, we will have checks and balances to even out this effect. Peer evaluations, evaluations from peer groups outside the state, rankings in US News (which take into consideration how easy the school is to enter/retain), and others will keep this problem to a minimum. Schools won’t be able to pass students through as they do now.

    Concerning your point about remedial classes, the school distributed model will also funnel kids towards trade schools, as I described above. We have a vastly underused trade and technical system in the state.

    Thank you for your comment. Please pass my article along to other educators.

  • scotchirish

    Should be popular after the initial shock – a whole new cadre of walk-on student athletes who don’t count against NCAA scholarship limits.

  • Dane Harris

    Scotchirish, thank you for reading. I was not able to include all the details of an 80 page report in such a brief article, but schools would not be able to overload the funds to benefit athletic teams. Not only that, but it would certainly hurt their efficiency ratios, thus costing the schools a portion of their funds.

  • scotchirish

    You would deprive TOPS recipients of the opportunity to participate in intercollegiate athletics?

  • Dane Harris

    That is not what was said at all. Please read my comment again. In response to your first message, schools will not be allowed to overload TOPS money simply to save scholarships for out of state athletes. That contingency was already considered and planned for, much like it is with the current system. Thank you for reading.

  • scotchirish

    If they are getting TOPS they would not be from out of state. It would open the way to supplement current athletic scholarship athletes with TOPS walk-ons.

  • MM

    Scotchirish,
    I think you’re talking about 2 different standards here. TOPS scholarships would be awarded to students based on a variety of criteria and efficiency ratios. Walk on athletes are awarded a place on the team for being the best in tryouts and excelling at their sport. Athletic participation isn’t a qualification for TOPS funding, nor is a TOPS award a prerequisite for walking on a team, and the proposed reforms don’t change that.

    I’d refer you to the author for the full proposal with more specific detail about the criteria that schools are required to meet when awarding TOPS money.

  • scotchirish

    I was talking strictly about the population of people eligible for TOPS (Louisiana residents). The effect on anyone from out of state was irrelevant. Bringing them up, which I did not do, was, IMO, a diversion.

    LSU baseball was a major beneficiary of TOPS for some years in that a fraction of an athletic scholarship (very common in college baseball) amounted to a full scholarship when added to TOPS.

    Athletics is just the beginning of the potential for corruption in this plan.

  • Dane Harris

    There will be more athletic scholarships available to out of state students if all in state athletes are not given scholarships and instead just take TOPS. That was a point that you brought up originally, and I responded that there are rules in place to take care of this. I’m not sure that you fully understand the plan. Nonetheless, thank you for reading and feel free to contact me directly if you would like more information. My email can be found at the end of the article.

  • LittleBrother

    The possibility of Louisiana leading the nation seems a bit far fetched. That long term goal can not be the expectation but otherwise, the plan for its face value seems like something that has great potential. Do you have any lead as to if these ideas will be implemented? Especially whereas students are to be encouraged to do better, that notion has to be the prime example of being easier said than done. Does this just encourage the the students to score higher on the test or actually work harder in the classroom because often the constant drilling of “teaching the test” can spoil the learning experience.

  • Dane Harris

    I disagree, and I think you would feel more comfortable after reading the full paper. Nonetheless, thank you for you contribution to the discussion. It has certainly enriched the article.

  • Dane Harris

    LittleBrother,
    To answer a couple of your questions. By leading the nation, I meant in terms of an innovative model such as this. We would certainly not expect our school to transform into the best, at least not overnight. As far as students being encouraged to do better, this has been proven over the course of the current program. Every time a standard has been raised, students have risen to meet that standard. This reform will encourage students to work harder in the classroom as well, because the ACT will not be the kingpin any longer and full scholarships are not guaranteed. Furthermore, every student will be guaranteed a full scholarship to a trade school, offering them another option that provides great earning power here in LA. That option has been too often ignored by our system.
    As far as implementation, everything is preliminary. There have been some discussions with officials but this will take some time (hopefully the next session). My goal when formulating a plan was to make it palatable to all stakeholders. This should be a plan that everyone can find some virture in, be it no wholly without fault. Past attempts have failed because they are often one sided ideas for reform. This reform, IMO, is our best shot at a comprehensive and sustainable one.
    I am encouaged by the interest in TOPS. It gives me hope to see so many interested in the future of higher education in the state. Thanks for reading.

  • scotchirish

    My comfort is irrelevant.

  • Dane Harris

    I agree. That’s not what will happen, competition will increase scores and schools are not required to give full scholarships to those they deem risky of not finishing. For those who do get a scholarship and don’t graduate (pending hardship/military service) they will have to repay the award.
    Grade inflation, non-finishers and wasted money are all things that plague the current system. This plan gives more flexibility to the schools so that if they see someone who doesn’t fit their focus, be it by major or by grades, they aren’t forced in to giving the scholarship. In the same breath, if they see a student that they would like to have, for strong scores in a particular subject (Math/Science) that only scored a 19 Composite, they won’t be forced to turn that student down.
    However, they will be held accountable for the results. Graduation rate will be only a small factor in the equation when it comes to funding. Schools cannot control peer evaluations nor can they control US News and World Report rankings. We already benchmark against members of the SREB (tuition is benchmarked against SREB members in the GRAD Act).
    By not forcing full scholarships to be given out, competition will ensue. It’s a basic principal of Economics. Schools will still be able to succeed without being forced into giving out massive amounts of scholarships.

  • scotchirish

    Impressive assertion of prescience (“That’s not what will happen,…”) This may help cut the fog:

    http://news.msn.com/us/a-post-college-sat-awaits-many-incoming-students?stay=1

  • Dane Harris

    Preaching to the choir. This reform will correct grade inflation. You can say it won’t and I can say it will, but at this point I think you’re more interested in stirring the pot than viewing anything objectively. Thanks for reading, scotchirish.

  • Gretchen1999

    Thank you, Dane, I really hope to see the improvements!