Gov. Terry Branstad, second from left, and Lt. Gov. Kim Reynolds, left, listen as two students at King Elementary School's Starfish Academy summer program discuss their art project that was on display Tuesday.


DES MOINES — Gov. Terry Branstad on Tuesday applauded the Iowa Board of Regents for tackling a "long overdue" revamp of the funding formula by which state appropriations are divided up among the state's three public universities.

Branstad credited the higher education governing board for conducting a "very thoughtful and systematic" review of a system in place for nearly five decades that is in need of updating to reflect the needs and challenges facing the campuses in Ames, Cedar Falls and Iowa City.

At the same time, Branstad took a hands-off approach in saying the decision on funding the state-supported universities should be left to the regents, telling reporters at his weekly news conference, "I believe that they, not the governor and the Legislature, are the appropriate body to make this determination."

Iowa's system is set up to have the autonomous board act as a "buffer" to keep the oversight of the University of Iowa, Iowa State University and the University of Northern Iowa free from political considerations or pressures.

Some concerns were raised when the regents adopted a funding revamp that would allocate a share of the state dollars based upon the number of in-state students enrolled in each institution.

The current system penalizes the University of Northern Iowa, which educates a higher percentage of in-state students. The new approach would have a negative impact on the University of Iowa, which has a heavier reliance on out-of-state and international students and has benefitted from the higher tuition levels they pay compared to Northern Iowa.

A regents-commissioned task force was told Iowa’s current approach to funding its three public universities has created an incentive to “overlook Iowa resident students in favor of out-of-state students that pay higher tuition.”

The panel has recommended implementing a new funding approach that would tie 60 percent of state funding to resident enrollment at the three universities. Under the proposed funding model, the remaining 40 percent of state appropriations would be distributed based on progress and attainment, access, job placement and other factors.

Iowa for decades has been funding its universities using a “base plus” method that gives the most money to the University of Iowa and the least to Northern Iowa. The task force said funding should be based on regent priorities and by aligning state funds with resident enrollment based on the cost to provide an education.

Branstad said Tuesday he thinks the regents had addressed concerns raised by University of Iowa faculty members that the revised formula failed to give proper consideration to graduate-level and research programs, adding, "this is going to be phased in over a period of years, and it can be, and it should be, adjusted if it turns out there are problems with it. But, frankly, it's probably long overdue."

State Sen. Jack Hatch, a Des Moines Democrat challenging Branstad in the 2014 governor's race, called the five-term Republicans' comments "disappointing."

"The governor has abdicated his leadership to the Board of Regents on an issue of higher education funding that has consequences far beyond the state universities," Hatch said in a statement. "The regents' funding formula affects all of Iowa's higher education institutions including community colleges and private colleges. The pool of Iowa applicants is shrinking, not growing, and the overall trend is toward more student debt.

"These are important policy issues that deserve the full attention of the state's chief executive and legislators before changes are made. We should use the regents report as a starting point to review and create a new system of how our higher education system can best meet the realities of all our Iowa students no matter where they go to school."

Branstad made his comments before touring a Starfish Academy summer program designed to keep students educationally engaged during summer months so their learning skills don't go dormant and contribute to a drop-off in their achievement levels.