New York State Higher Education Capital
Matching Grant Program        

Alternative Non-State Matching Fund Contribution Methodology and Waiver Process

Background

The HE Cap statute (Chapter 63 of the Laws of 2005, as amended) directs the Dormitory Authority to develop a “methodology to determine the required non-state funds contribution for colleges” (the “Alternative Matching Methodology”) as an alternative to the standard matching requirement of three non-State fund dollars for every State grant fund dollar, and submit this methodology (and the resulting “Alternative Matching Ratios”) to the HE Cap Board for approval.  The statute goes on to prescribe that:

• The methodology will require a greater contribution from those colleges with greater fiscal resources as measured by endowment per full time equivalent student and tuitions and fees.
• The numerator in the matching ratio of non-State funds to grant award cannot be greater than 3 (e.g. – the standard matching ratio) or less than 0.5.

On January 15, 2008, the HE Cap Board approved the Alternative Matching Methodology and Alternative Matching Ratios presented by Dormitory Authority staff, detailed below.

Waiver Request Process

The HE Cap program statute makes every grant recipient subject to the Standard Matching Requirement unless they receive a Waiver from the HE Cap Board.  HE Cap Grant recipients that wish to request a Waiver of the standard 3:1 matching requirement may submit a Waiver Request to the HE Cap Board for its consideration.

The Waiver Request must include (1) a completed Alternative Matching Methodology Worksheet, (2) a copy of the institutions audited financial statements for the most recently completed fiscal year, and (3) a copy of completed Form NYSED-2.4 as submitted to the State Education Department for the academic year that coincides with the institution’s most recently concluded fiscal year.  The Board will only consider a Waiver Request when all of these items have been submitted to and verified by the Dormitory Authority (as staff to the Board).

A Waiver Request should be submitted at the same time that an eligible institution submits an Application and Project Information Sheet for processing.  However, this is not a requirement. 

Please note that submission (and approval) of a Waiver Request does not obviate the responsibility of the requesting institution to demonstrate that its eligible HE Cap project(s) is fully funded and identify all sources of funds necessary to complete the project in its Application and Project Information Sheet, or to secure those funds.  Approval of a Waiver Request by the Board will only reduce the required non-State fund matching ratio to (from the standard 3:1 match) to either 2:1 or 1:1.  Further, any reduction in the required non-state matching ratio through an approved Waiver Request will not serve to increase an institution’s HE Cap grant allocation.       

Alternative Matching Methodology - Measuring Fiscal Resources

• Endowment Per FTE:  The statute directs that the methodology will consider “endowment per FTE student”.  The definition for “endowment” in the statute does not comport with current accounting principles; therefore the Board has approved the use of “Investments per FTE student” as the appropriate analog measurement.  Institutions requesting a Waiver will calculate and submit the value of their Investments per FTE Student on the Alternative Matching Methodology Worksheet along with documentation.

• Tuition and Fees:  The statute requires the methodology to consider tuition and fees.  The methodology requires includes net tuition and fee revenue as reported in each institution’s audited financial statements (AFS).  This is divided by FTE Enrollment to arrive at “Net Tuition and Fee Revenue per FTE Student”.  This adjusts the measurement of tuition burden for the size of an institution and the amount of financial aid that is provided to students by the institution.  Institutions requesting a Waiver will calculate and submit the value of their “Net Tuition and Fee Revenue per FTE Student” on the Alternative Matching Methodology Worksheet along with documentation.

Alternative Matching Ratios

For Institutions that submit a Waiver Request, approval and assignment of an appropriate Alternative Matching Ratio will be determined with a two-step process: 

• Step 1:  The Board will determine whether or not a grant recipient is eligible for an Alternative Matching Ratio using the value of their Long-term Investments per FTE Student.  To be eligible, an institution has to demonstrate that the value of their long-term investments per FTE student is below a certain threshold (Note: at this time, the Board has not yet determined a threshold level).  Two outcomes are possible:

• Institutions above the threshold will not be eligible for an Alternative Matching Ratio and their Waiver Request will be denied. 
• Institutions below the threshold would be eligible for at least a 2:1 matching ratio and possible a 1:1 matching ratio, based on the outcome of the second step. 

• Step 2:  The Board will determine whether or not an institution is eligible for a 1:1 matching ratio based on their demonstrating that their Net Tuition and Fee Revenue per FTE Student is below a certain threshold. (Note: at this time, the Board has not yet determined a threshold level).