Performance Funding : A Descriptive Study

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Performance Funding, A Descriptive Study
During the years 1979 to 2007, 26 states enacted performance funding (Harnisch 2011). According to the National Conference of State Legislatures, today 33 states use performance based funding as a source of determination for their higher education institutions. Locally, the state of Louisiana is not exempt. According to senate bill 337, the higher education commissioner must submit a proposal for outcome based funding by the end of 2015 to the Board of Regents for approval. Performance based funds are often used across the United States thus understanding this mandate is critical to the continued success of higher education institutions. The research shows both the positive and negative outcomes
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Dougherty notes that the “First wave of performance funding adoption began in Tennessee in 1979, and ended in 2000, when a recession struck and caused a sharp decline in new program adoptions and the discontinuation of many existing programs. It seemed as if performance funding had been but a passing fancy. However, beginning in 2007, another wave of performance funding arose. The first-wave programs typically involved a bonus for higher education institutions above base state funding. The performance funding bonus was relatively small, between 1 and 6 percent of base state funding for public higher education” (Dougherty and Reddy 201). This policy has been labeled “performance funding 1.0”.
“The second wave of performance funding began in 2007 with two-thirds of these new programs being re-adoptions of discontinued first-wave programs. In about two-fifths of these wave 2 programs, performance funding typically did not take the form of a bonus on top of regular state funding. Rather, performance funding dollars were embedded in the base state funding for higher education.
This has been dubbed “performance funding 2.0” (Dougherty and Reddy 2013).
As noted by Friedel, Performance 1.0 emphasized outcome measures such
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