Overview

Today’s fiscal climate and economic need for expanded postsecondary access and completion have fueled a resurgence of interest in and state action regarding performance funding policies, which tie a portion of state appropriations to metrics that gauge postsecondary institutional performance on various indicators.

Building on the lessons of early performance funding efforts over the past 35 years, more than two-thirds of states are currently developing and/or implementing outcomes-based funding (OBF) policies of varying construct, and a number of other states are interested. An evolved form of performance funding, OBF is distinct from earlier performance funding models in both design and implementation—primarily because of its more explicit connection with state needs, focus on student completion, and refined development and modeling approaches.

The strain on current postsecondary education financing models is plainly evident—and their shortcomings are reflected in real costs to students, taxpayers and the economy. OBF can and should prompt needed discussions about how—and how well—our colleges are serving students. This site serves as a resource to that end, with current state-by-state OBF policy and funding information and a report outlining an OBF policy classification system as well as design and implementation principles to help states improve their policies.