SB 2079

Under present law, the Tennessee higher education commission (THEC) includes 10 appointed members as follows: six gubernatorial appointees, one student member appointed by the governor, one appointee of the speaker of each chamber of the general assembl y, and one member who is jointly appointed by both speakers. Beginning on the date that this bill becomes a law, this bill revises the appointing authority for THEC to be as follows: (1) Three gubernatorial appointees, plus the student member appointed by the governor; (2) The speaker of the senate shall appoint three members, one of whom must be appointed as the successor to the member presently appointed from the middle grand division by the governor), whose term expires on June 30, 2030, and one of whom must be app ointed as the successor to the member presently appointed from the west grand division jointly by both speakers, whose term expires on June 30, 2026; and (3) The speaker of the house of representatives shall appoint three members, one of whom must be appointed as the successor to the member presently appointed from the middle grand division by the governor whose term expires on June 30, 2026, and one of whom must be appointed as the successor to the member presently appointed from the east grand division by the governor whose term expires on June 30, 2031. Present law requires THEC to develop and utilize an outcomes-based funding formula model to ensure the fair and equitable distribution and use of public funds among state institutions of higher education. This bill adds a requirement that THEC establish a means of using inputs into the outcomes-based funding formula model to establish target on-time graduation rates for each state institution of higher education and publish the target rates at least once every five years. The full text of this bill def in es "on-time graduation."" Present law requires THEC to annually review tuition and other institutional fees charged to students attending state institutions of higher education and approve a maximum allowable tuition and fee increase policy binding upon all public institutions of higher education. Present law authorizes THEC to approve separate maximum allowable tuition and fee increases for one or more public institutions of higher education that differ from the general tuition and fee policy if THEC determines that a separate tu ition and fee policy for an institution is necessary based on the circumstances or needs of the respective institution. This bill adds that, in order for THEC to approve a separate maximum allowable tuition and fee increases, THEC must also determine tha t the institution has demonstrated positive growth in the institution's on-time graduation rate calculated on a three-year rolling average. This bill prohibits a public institution of higher education from charging students tuition and fees for an online undergraduate course that, in total, exceeds the total tuition and fees charged to students for a comparable undergraduate course offered i n person at the institution by 75% or more if the institution does not offer an in-person course option that satisfies the same course credit as the online course. This bill requires the board of trustees for the University of Tennessee, the board of regents, and each state university board to adopt and implement (by July 1, 2026) a policy regarding the use of revenues generated by the out-of-state undergraduate tu ition and fees charged by the institutions governed by the respective board. The policy must describe the board's utilization plan for revenues derived from such tuition and fees and how those revenues may be used to mitigate the tuition and fee costs fo r in-state undergraduate students. ON MARCH 30, 2026, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 2079, AS AMENDED. AMENDMENT #1 makes the following changes:  Changes from three years to two years the time for ""on-time graduation"" for students enrolled in a community college governed by the Tennessee board of regents.  Removes the provision that prohibits a public institution of higher education from charging students tuition and fees for an online undergraduate course that, in total, exceeds the total tuition and fees charged to students for a comparable undergraduate course offered in person at the institution by 75% or more if the institution does not offer an in-person course option that satisfies the same course credit as the online course."