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Public-Private Partnerships in Higher Education: The Western Governors University Initiative

A note for our readers: the views reflected by the authors do not reflect the views of ASPA.

By Frank Woodward

Woodward julyJon Nixon wrote in 2011 in Higher Education and the Public Good: Imagining the University that, although universities are natural forums for social engagement and public dialogue, in the contemporary economic climate they have increasingly needed to prove their value as commodities in the public interest. Faced with increasing costs, skyrocketing tuition and rapidly shifting technology, higher education finds itself reframed as a commodity whose future rises or falls on the degree to which it is good for something.

In this light, a number of university systems have sought innovative policy initiatives that attempt to bridge the gap between public service and private delivery. These initiatives can potentially offer economic efficiencies for states, but they often raise important questions about the value and character of traditional forms of higher education as well. As this article will explore, such initiatives can lead both to new interpretations of education policy and to broad challenges to existing economic models.

In the mid-1990s, a group of governors from 19 western states looked to the newly emerging World Wide Web as a platform for higher education delivery. Their initiative launched Western Governors University (WGU), which according to their website was developed as a way to address “rapid population growth confronted by limited public funds for educational services.” Today, WGU is a private, regionally accredited, nonprofit online university enrolling over 40,000 students from all 50 states. One of its most distinctive–if not controversial—elements is its implementation of a competency-based model. This model was endorsed by WGU’s founders to provide what they saw as a focus on concrete, practical outcomes built directly around job market needs.

“Who Wants to Sit Through Classes…?”

Competency-based models offer credit for the demonstrated achievement of defined subject outcomes, and are not tied to traditional term-length courses or programs. In the WGU model, traditional tuition charges are replaced with a flat fee structure, allowing students to attempt as many competencies as they wish within a six-month period. U.S. News recently quoted WGU’s President Robert Mendenhall who characterized the competency-based model by asking this question: “Who wants to sit through classes when you already know the stuff?” Academicians might well argue that “the stuff” to which Mendenhall refers is indeed worthy of reflection and discussion in a classroom setting. However, state governors and policymakers have found his analysis hard to argue with purely from an economic perspective.

The full academic implications of WGU’s model remain to be seen. It is clear that while WGU has soared in popularity, its completion rates remain very low. According to the Chronicle of Higher Education’s College Completion report based on 2010 data, WGU’s six-year graduation rate was only 6.5 percent, placing them in only the second percentile among four-year private nonprofit universities. (The data file is available from the Chronicle of Higher Education at this link.) This fact alone should give state policymakers pause in their rush to establish partnerships and implement changes to traditional public education models.

From a policy perspective, Western Governors University’s model has already challenged a number of traditional policy interpretations. Because WGU is online only, the competency-based model has demanded considerable political support in order to maintain Title IV eligibility for financial aid. According to Doug Lederman writing for Inside Higher Ed in 2014, WGU originally qualified to receive and distribute Title IV financial aid funding through its classification as a “distance learning demonstration program.” However, Lederman reports that in 2006, this U.S. Department of Higher Education exemption ran its course. As a result, Section 8020 of the Higher Education Reconciliation Act (HERA) of 2006 revised the definition of ‘eligible program’ in order to include institutions that use a “direct assessment of student learning…” Interestingly, as Lederman observed, WGU chose not to take advantage of this direct assessment categorization, instead relying on a technical definition equating their competency-based units to credit hours. However, the HERA reauthorization has certainly opened a door for other direct assessment programs to take advantage of Title IV funds as they develop and implement alternative delivery systems.

Growing State Partnerships: WGU-Tennessee

WGU’s regional accreditation and flat-rate tuition model continue to fuel its appeal among states and its expansion into new markets nationwide. Early in 2014, Tennessee Governor Bill Haslam launched the “Tennessee Promise” initiative, promising to supplement any remaining tuition and fees costs not already covered by financial aid for two years of community college education for Tennessee students. This initiative partners with Western Governors University in the establishment of a branch called WGU-Tennessee. In Governor Haslam’s view, “WGU Tennessee fills a critical need in our postsecondary landscape.” This public-private partnership serves as a component of Tennessee’s “Drive to 55” initiative, which seeks to raise the percentage of Tennessee residents with at least a two-year degree or certification to 55 percent by 2025.

Governor Haslam’s initiative reveals the extent to which public-private education partnerships potentially reframe a state’s educational values in largely economic terms. However, WGU’s extremely low graduation rates and its controversial academic delivery model deserve critical attention and analysis on the part of state policymakers before significant investments and partnerships are established. While the potential for creative and innovative state partnerships certainly exist, these initiatives must be based on a more substantive evaluation of competency-based delivery. In the meantime, states would do well not to forget the many thousands of students, faculty and staff who are part of existing, “traditional” universities throughout each state. These traditional universities still have a great deal to offer, and although the economic challenges are significant, they can also remain a source of innovation and increased efficiency in public higher education.


Author: Frank Woodward serves as assistant vice president for university advancement at Lincoln Memorial University. In May 2014, he completed the DPA degree at Valdosta State University. His research interest deals with performance-based funding policy in public higher education. He can be reached at [email protected].

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The American Society for Public Administration is the largest and most prominent professional association for public administration. It is dedicated to advancing the art, science, teaching and practice of public and non-profit administration.

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