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Chancellor outlines DeWine budget for higher education, highlights merit aid, employment-based performance funding and campus right-sizing
Summary
Chancellor Mike Duffy told the Senate Higher Education Committee the governor's FY26–27 budget keeps student-focused aid, expands performance metrics to include post-graduation wages and proposes an $82 million revolving loan fund for campus square-footage reductions while defending guarantees for merit awards and admissions.
Chancellor Mike Duffy presented Governor DeWine's executive budget for higher education to the Senate Higher Education Committee, saying the plan centers on student-focused investments to retain Ohio talent and align college incentives with labor-market outcomes. "This is return on investment. This is a workforce focus," Duffy said as he described measures intended to tie state funding to measurable student outcomes.
The budget would maintain key need-based aid and scholarships while adding new performance metrics. Duffy outlined the Governor's Merit Scholarship — $5,000 per year for students in the top 5% of each high school class who remain in Ohio — and said the program has produced high acceptance rates (76% in its first year, 87% in the second), which he argued helps keep students in-state.
On performance funding, Duffy said Ohio will incorporate post-graduation wage outcomes into its performance-based funding formula, a change he framed as aligning institutional incentives with student returns. He described a $100,000,000 allocation in the as-introduced budget to factor employment outcomes into distributions of state share of instruction, which he said represents a modest portion of the overall appropriation and would be split across four-year and two-year sectors to limit cross-sector disruption.
Duffy also proposed an $82,000,000 revolving loan fund to finance strategic reductions in campus square footage for public colleges and universities that have seen enrollment declines. He said the program would prioritize institutions with decreased enrollment, allowing campuses to reduce fixed facility costs in response to demographic and modality shifts.
Committee members pressed Duffy on House amendments to the budget and related bills. Vice Chair Timken relayed concerns from religious independent institutions about House language that would compel compliance with Senate Bill 1; Duffy said the department supports the as-introduced budget but will answer technical questions about any legislative language and noted the House version includes guaranteed-admissions provisions. Duffy warned that certain House amendments to the state share of instruction (SSI) could introduce binary thresholds — for example, eligibility tied to a 25% Pell share — creating winners and losers because the SSI appropriation is a fixed total.
Several senators raised questions about how guaranteed and direct admissions would operate for independent institutions, whether the top-10% guarantee (and top-5% merit guarantee) would be feasible for selective colleges, and how accelerated degree programs would interact with scholarship duration limits. Duffy said the administration is open to legislative suggestions and that longitudinal evaluation will be necessary to judge outcomes from three-year degrees and other innovations.
The committee did not take formal action on these budget provisions; Duffy concluded by offering to answer follow-up technical questions.
Next steps: the committee scheduled additional budget hearings and public testimony on upcoming dates.
