This is the third paper on the topic of outcomes-based funding written by Dennis Jones for Complete College America. The first paper, "Performance Funding: From Idea to Action" (ED535356), proposed a set of design and implementation principles to help states develop and implement their own outcomes-based funding models. The second paper,…

Implementing an incentives-based budget system at a large public research university significantly redirected internal funds while producing notable organizational and financial surprises. For example, units did not increase their "hoarding" of students, contrary to some expectations. The findings point to several issues for further…