(a) It is the duty of the commission on a continuing basis to study the use of public funds for higher education in this state and to analyze programs and needs in the field of higher education.

(b) The commission shall establish and ensure that all postsecondary institutions in this state cooperatively provide for an integrated system of postsecondary education. The commission shall guard against inappropriate and unnecessary conflict and duplication by promoting transferability of credits and easy access of information among institutions.

(c) The commission shall:

(1) Provide planning and policy leadership, including a distinct and visible role in setting the state's higher education policy agenda and serving as an agent of education transformation;

(2) Develop and advance the education public policy agenda of the state to address the challenges facing higher education in Tennessee; and

(3) Develop public consensus and awareness for the Tennessee higher education public policy agenda.

(d)

(1) The commission shall develop a statewide master plan to increase the educational attainment levels of Tennesseans through strategic future development of public universities, community colleges, and colleges of applied technology.

(2) In the development of this master plan, the commission shall actively engage with state institutions of higher education and their respective governing boards, as well as key stakeholders, and the appropriate state agencies.

(3) The commission shall engage regional and statewide constituencies for input and information to ensure the master plan supports the development of higher education opportunities for Tennesseans. Additionally, provisions of the master plan shall facilitate regional cooperation and alignment among postsecondary institutions, secondary educational institutions, business, and industry, as well as civic and community leaders.

(4) This master plan shall be reviewed and revised as deemed appropriate by the commission, and shall include, but not be limited to, consideration of the following provisions:

(A) Addressing the state's economic development, workforce development, and research needs;

(B) Ensuring increased degree production within the state's capacity to support higher education;

(C) Using institutional mission differentiation to minimize redundancy in degree offerings, instructional locations, and competitive research, and to realize statewide efficiencies through institutional collaboration; and

(D) Establishing eligible incarcerated individuals housed in correctional facilities in this state as a focus population in order to increase the degree attainment of such individuals.

(5) Following completion of the master plan and to expedite implementation, the commission shall submit any necessary higher education policy recommendations to the governing boards of the various institutions, the governor, and the general assembly through the education committee of the senate and the education committee of the house of representatives.

(e) Concurrent with the adoption of each revised master plan and in consultation with the respective governing boards, the commission shall approve institutional mission statements. Submitted by state institutions, an institutional mission statement shall characterize distinctiveness in degree offerings and shall address institutional accountability for the quality of instruction, student learning, and, where applicable, research and public service to benefit Tennessee citizens. Nothing contained in this section shall prohibit any institution from pursuing research and related activities that are consistent with the institution's mission.

(f)

(1) The commission shall 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.

(2) This funding formula model shall further the goals of the statewide master plan by emphasizing outcomes across a range of variables that shall be weighted to reinforce each institution's mission and provide incentives for productivity improvements consistent with the state's higher education master plan, including:

(A) End-of-term enrollment for each term, student retention, and timely progress toward degree completion and degree production; and

(B) Student transfer activity, research, and student success, as well as compliance with the transfer and articulation policies required in this section.

(3) The funding formula model shall consider the impact of tuition, maintenance fees, and other charges assessed by each institution in determining the fair and equitable distribution of public funds. The commission shall also consider capital outlay programs and operating expenses, which shall be utilized to determine the higher education appropriations recommendation.

(g)

(1) The commission shall establish a review committee to aid in development or revision of the higher education master plan and funding formula. The committee shall include the executive director of the Tennessee higher education commission, the chancellor of the board of regents, the president of the University of Tennessee system, each president of a board of regents state university, the commissioner of finance and administration, the comptroller of the treasury, the chairs of the standing committees on education and finance, ways and means of the senate, the chairs of the standing committees on education and finance, ways and means of the house of representatives, and the directors of the office of legislative budget analysis, or their designees.

(2) The committee shall review the funding formula components, as well as identify needed revisions, additions, or deletions to the formula. The committee shall also ensure that the funding formula is linked to the goals and objectives of the master plan.

(3) The review committee shall meet at least annually.

(h) The commission shall submit the revised higher education funding formula to the office of legislative budget analysis and the comptroller of the treasury no later than December 1 of each year. The commission shall also report any projected tuition increases for the next academic year to the office of legislative budget analysis and the comptroller of the treasury no later than December 1 of each year. The office of legislative budget analysis and the comptroller of the treasury shall each provide comments on the higher education funding formula to the chairs of the education and finance, ways and means committees of the senate and the chairs of the education and finance, ways and means committees of the house of representatives.

(i) Before any amendment or revision to the outcomes-based funding formula model shall become effective, the amendment or revision shall be presented to the education and finance, ways and means committees of the senate and the education and finance, ways and means committees of the house of representatives for review and recommendation.

(j) In the implementation of its duties, the commission, in cooperation with the commissioner of finance and administration and the comptroller of the treasury, shall establish uniform standards of accounting, records, and statistical reporting systems in accordance with accepted national standards, which standards shall be adhered to by the various institutions in preparing for submission to the commission statistical data and requests for appropriations.

(k) The commission shall develop funding recommendations that reflect the outcomes-based funding formula model as well as the priorities of the approved master plan.

(l) The commission shall have no authority for recommending individual colleges of applied technology's operating budgets nor in approving or disapproving the transfer of any funds between colleges of applied technology deemed necessary by the board of regents to carry out the provisions of chapter 181 of the Public Acts of 1983. For fiscal years ending on and after June 30, 2013, the commission shall have no authority for recommending individual community colleges' operating budgets or in approving or disapproving the transfer of any funds between community colleges as may be determined necessary by the board of regents.

(m) The commission shall develop a comprehensive strategic financial plan for higher education focusing on state appropriations, student tuition and other charges, financial aid, and capital and infrastructure issues, as well as other factors, as appropriate. The plan shall also address higher education efficiency, affordability, performance, return on investment, and other relevant factors.

(n)

(1) The commission shall review annually tuition and other institutional fees charged to students attending state institutions of higher education.

(2) Following this review, the commission shall approve annually a tuition and fee policy binding upon all state institutions of higher education. This tuition policy shall apply only to tuition and fees charged to undergraduate students classified as Tennessee residents, commonly referred to as in-state tuition or maintenance fees.

(3) The tuition policy shall include two (2) approved ranges of allowable percentage adjustment:

(A) One (1) range for any proposed modification to the current tuition rates; and

(B) One (1) range for any proposed modification to the combined total amount of tuition and all mandatory fees assessed.

(4) Institutions may adopt tuition and fee adjustments within the commission's approved policy ranges, but no increase shall exceed the maximum percent adjustment approved by the commission.

(5) Tuition-setting authority for undergraduate students not classified as Tennessee residents and all graduate-level students shall be the sole responsibility of the institution's respective governing board.

(6) Nothing in this subsection (n) shall prohibit institutions from reducing the total tuition and fees charged to students.

(7) Notwithstanding this subsection (n), no change in tuition or fee policy shall be made that, in the opinion of the board of regents, might adversely affect compliance with, or future borrowings pursuant to, financing agreements with the Tennessee state school bond authority.

(o) The commission shall establish a formal process, consistent with § 49-7-1002, for identifying capital investment needs and determining priorities for these investments for consideration by the governor and the general assembly as part of the annual appropriations act.

(p) As necessary, the commission may convene the membership, leaders, and personnel of each public institution, governing board, or system to ensure a cohesive and coordinated system of higher education public policy. The commission may also conduct orientation and informational policy seminars for members of governing boards.

(q)

(1)

(A) The commission shall study the need for particular programs, departments, academic divisions, branch operations, extension services, adult education activities, public service activities, and work programs of the various institutions of higher learning, with a particular view to their cost and relevance and to make recommendations to the respective governing boards for the purpose of minimizing duplication and overlapping of functions and services and to foster cooperative programs among the various institutions.

(B) The commission is authorized to make recommendations to the governing boards for the termination of existing on-campus and off-campus programs of those institutions set forth in § 49-7-203 that are determined by the commission to be unnecessarily duplicative. A copy of the recommendations shall be filed with the education committee of the senate and the education committee of the house of representatives.

(C) The governing boards of the institutions shall make a report annually on any program terminations to the education committee of the senate and the education committee of the house of representatives, and a copy of the report shall be filed with the commission.

(2)

(A) The commission shall review and approve or disapprove all proposals for new degrees or degree programs or for the establishment of new academic departments or divisions within the various institutions of higher learning.

(B) Determination of specific courses or course content, however, shall continue to be the exclusive function of the governing boards of the various institutions.

(C) This subdivision (q)(2) shall apply to state colleges of applied technology only if the schools grant degrees and shall apply only to those schools granting degrees, unless the system as a whole grants degrees.

(3) The commission shall review and approve or disapprove all proposals by any existing higher education institution to establish a physical presence at any location other than its main campus or to extend an existing location that will be utilized for administrative purposes or to offer courses for which academic credit is offered. If the new location will create or expand a physical presence out of state, the higher education institution shall, through its governing board, file with the commission a notice of intent to initiate out-of-state instructional activity prior to the development of the proposal. The commission shall, no later than February 15 of each year, report to the chairs of the fiscal review committee, the education committee of the senate, and the education committee of the house of representatives of any such notices filed in the previous year and the status of that application. The commission shall develop policies and procedures governing the process outlined in this subdivision (q)(3). This subdivision (q)(3) shall also apply to state colleges of applied technology.

(r)

(1) The commission shall require all state institutions of higher education to collaborate and develop a transfer pathway for at least the fifty (50) undergraduate majors for which the demand from students is the highest and in those fields of study for which the development of a transfer pathway is feasible based on the nature of the field of study.

(2)

(A) A transfer pathway shall consist of sixty (60) hours of instruction that a student can transfer and apply toward the requirements for a bachelor's degree at a public institution that offers the transfer pathway. The sixty (60) hours of instruction in a transfer pathway shall consist of forty-one (41) hours of general education courses instruction and nineteen (19) hours of pre-major courses instruction, or elective courses instruction that count toward a major, as prescribed by the commission, which shall consider the views of chief academic officers and faculty senates of the respective campuses. Courses in a transfer pathway shall transfer and apply toward the requirements for graduation with a bachelor's degree at all public universities.

(B) An associate of science or associate of arts degree graduate from a Tennessee community college shall be deemed to have met all general education and university parallel core requirements for transfer to a Tennessee public university as a junior. Notwithstanding this subdivision (r)(2)(B), admission into a particular program, school, or college within a university, or into the University of Tennessee, Knoxville, shall remain competitive in accordance with generally applicable policies.

(C) The forty-one-hour lower division general education core common to all state colleges and universities shall be fully transferable as a block to, and satisfy the general education core of, any public community college or university. A completed subject category, for example, natural sciences or mathematics, within the forty-one-hour general education core shall also be fully transferable and satisfy that subject category of the general education core at any public community college or university.

(D) The nineteen-hour lower division AA/AS area of emphasis articulated to a baccalaureate major shall be universally transferable as a block satisfying lower division major requirements to any public university offering that degree program major.

(3) It is the legislative intent that community college students who wish to earn baccalaureate degrees in the state's public higher education system be provided with clear and effective information and directions that specify curricular paths to a degree. To meet the intent of this section, the commission, in consultation with the governing boards of all state institutions of higher education, shall develop, and the governing boards of all state institutions of higher education shall implement, the following:

(A) A common course numbering system, taking into consideration efforts already undertaken, within the community colleges to address the requirements of subdivision (r)(1); and

(B) Listings of course offerings that clearly identify courses that are not university parallel courses and therefore not designed to be transferable under subdivision (r)(1).

(4) This subsection (r) shall be fully implemented no later than the fall 2015 semester. Until this subsection (r) is fully implemented, prior to the beginning of each semester, the commission shall report to the chairs of the education and finance, ways and means committees of the senate and the chairs of the education administration and planning and finance, ways and means committees of the house of representatives on the progress made toward completion of the nineteen (19) pre-major course blocks provided in subdivision (r)(2)(D).

(5) The commission shall have ongoing responsibility to update and revise the plans implemented pursuant to this subsection (r) and report to the chairs of the education and finance, ways and means committees of the senate and the chairs of the education and finance, ways and means committees of the house of representatives no later than October 1 of each year on the progress made toward full articulation between all public institutions.

(s) Notwithstanding any law or rule to the contrary, the commission, in consultation with the governing boards of state institutions of higher education, shall develop policies under which a person who satisfies the admissions requirements of a two-year institution and a four-year institution may be admitted to both such institutions. The commission shall identify those institutions for which such dual admission is appropriate, based on geographic or programmatic considerations. These policies shall be adopted and implemented by the governing boards of all state institutions of higher education no later than July 1, 2015.

(t)

(1) The commission, with the assistance of the University of Tennessee system, state universities, and the community college system, shall develop information concerning the potential career opportunities in each curriculum or major field of study leading to a baccalaureate degree that is offered at a state institution of higher education. The information shall include, but not be limited to, the potential job market in this state in the major field or curriculum after graduation, the median income or an income range for jobs in the major field or curriculum in this state, and whether an advanced degree in the major field or curriculum is required to obtain employment in that field.

(2) The information developed concerning career opportunities for curricula and major fields of study under subdivision (t)(1) shall be posted on the commission's web site. A link to the information developed by the commission, together with a brief description of the type of information available, shall be posted on the web site of each state institution of higher education offering baccalaureate degrees. The institutions shall not be required to publish the information developed by the commission in school catalogs, but school catalogs shall include, in a prominent location, the web site address for the information and a brief description of the type of information that is available.

(3) The information required by this subsection (t) shall be updated at least annually.

(u) The commission shall undertake specific duties that are directed by resolution of the general assembly or requested by the governor.