As the university continues to search for “innovative and entrepreneurial” revenue streams, the university’s model for online education will be morphing into one that is more rooted in — and shares more revenues with — individual colleges and departments.
What started as “Educational Outreach” in 1997 and began offering distance learning programs and has since been called “ECampus” and “University College,” will now become “Innovative Education,” the university’s new house for online education that is anticipated to push out $2 million in revenue to colleges and departments this year, USF Provost Ralph Wilcox told members of the Faculty Senate on Wednesday afternoon.
While state legislation requires universities’ online education to be administered through their continuing education departments, Wilcox said this model will allow individual colleges and departments greater control over their content.
“You own the content and you will be delivering the program,” Wilcox said. “Innovative Education doesn’t do that. What Innovative Education is, is a support service organization that will do all the leg work, provide student services, instructional design and faculty development.”
Last year, USF was the No. 2 producer of online education in the state of Florida, and brought in $27.9 million in tuition dollars, $5.1 million in institutional fees and $6.2 million in distance learning fees, solely for online education revenues.
Wilcox said the new model for Innovative Education will receive no funding from state-funded Education and General (E&G) revenues, but will sustain itself off cost-recovery and market-based business models.
“… University College was creating some communication difficulties across the university,” he said. “This is a unit that lives off its own bottle. We invest no state dollars whatsoever. All employees will be paid off revenues they’re able to generate.”
While Innovative Education will provide the funds during the start-up phase, it will collect the revenue and pay all costs affiliated with the creation and delivery of the course. With cost-recovery modeled courses, the university has some flexibility with setting tuition to cover cost delivery, but it cannot exceed that cost. Market-rate tuition allows the universities to charge at a rate that earns the university a profit, but these programs require the Board of Governors’ approval.
In addition, Wilcox said, Innovative Education will share 10 percent of all distance learning fees, something every student taking an online class pays $50 per credit hour into; a $10,000 incentive for each face-to-face class converted to an online class, $5,000 to be provided up-front and $5,000 to be provided later; $300,000 in funding to colleges for teaching and graduate assistant support in course delivery and a one-time investment of $425,000 this year to step-up distance learning.
Additionally, faculty who attend professional development seminars will receive $500 as compensation in order to provide the Southern Association of Colleges and Schools accrediting body with documentation of the university’s online initiatives.
“You’ll probably say, ‘Why do I have to do that? I’ve been delivering this course online for the past three or four years. I know all there is to know,’” Wilcox said to faculty. “Well, SACS doesn’t know that. SACS requires documentation that every instructor teaching an online class has to complete a professional development program. We’re trying to soften that irritation that some of you might feel by compensating you for that time.”
Wilcox said the university needs to prepare itself to stay competitive.
This year, the University of Florida received additional funding from BOG to lead the state’s initiatives in online education.
“We would be naive to ignore the opportunity for growth and we would certainly be naive to ignore the competition,” he said.