Why would a MnSCU school lose students to help other campuses?

Tom Weber of MPR News' Daily Circuit asks Minnesota State Colleges and Universities (MnSCU) system Chancellor Steven Rosenstone why, in a system that generally pegs funding to headcount, would campuses want to coordinate academic programs if it meant losing students?

Rosenstone's reply:

"Well, that's the fundamental question. And I think one of the things the working groups recommended is that we look carefully at both the financial and administrative models to make sure that we're really rewarding collaboration as opposed to just rewarding headcount. If we want to incent collaboration, if we want to incent easy pathways for students ... if we want to incent efficiency and effectiveness of operations, it has to ... be there in the rules of the game."

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Weber asked whether that could lead to a change in the formula used to fund campuses. Rosenstone answered:

"That's one of the questions that lies ahead of us."

You can listen to the interview here. It runs about 11-12 minutes.