This chapter describes a comprehensive set of best practices for the evaluation of state formula funding models and state higher education funding in general, based on existing practices within the United States. It represents a review of practices that lead to stakeholder engagement as an objective, collaborative process.

The United States cannot meet its higher education goals without changing the way it funds public colleges and universities. Current funding models do not sufficiently advance fully scaled improvements. Instead, today's models create unfunded mandates: Colleges are required to increase completion rates, but they do not receive essential funding…

This paper analyzes the incentives induced by a formula to fund universities based primarily on enrolment. Using a simple game theoretical framework, we argue that the strategic behaviour induced by those formulas is to favour enrollment. We further argue that if the funding value differs by enrolment type, it introduces incentives to substitute…

The primary purpose of this study was to examine how best a Tennessee 4-year public university can perform under the state's outcomes-based funding formula, most commonly identified as either PF 2.0 or the Complete College Tennessee Act (CCTA) funding formula. Using a mixed methods approach, the research analyzed select input variable performance…

Policy implementation research suggests that the likelihood of policy success, i.e. matching policy outcomes with expectations, can be best assessed by engaging the bottom-up perspectives of those who will implement the policy. This paper works from this premise and examines the views of university leaders in Kazakhstan on the potential impact of…

The purpose and outcome of this study was to provide insight into clearly articulated parameters that might serve as a basis for the development of a generalizable outcomes-based funding model that any higher education system could use. Funding models were analyzed and telephone interviews were conducted from the ten states that were identified by…

At its April 27, 2014 meeting, the Arkansas Higher Education Coordinating Board approved the funding models for the two-year colleges, universities, and the technical centers (former technical institutes merged with universities). These models had been developed in conjunction with presidents and chancellors after meetings and revisions. The…

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,…

In the rapid development of Chinese higher vocational education, large gaps have appeared in the scale of development and resource generation among the provinces, among regions in the provinces, and among higher education institutions in the provinces. Balanced regional development and provincial-level coordination have become policy focal points,…

During the 2004 legislative session, the Colorado General Assembly enacted Senate Bill 189 (SB189), which established the first system of college vouchers in the United States. The supporters of SB189 hoped that the voucher system, called the College Opportunity Fund (COF), would: 1) stabilize the flow of state funding to higher education; 2)…

Over the past several years, public higher education, both in the U.S. and internationally, has increasingly been required to explain, defend, and validate its performance and value to a wide variety of constituents, including governors, legislators, students, parents, employers, and taxpayers. In addition, in 2006, then U.S. Secretary of…

Purpose: The purpose of this paper is to assess the research efficiency of the Chilean higher education institutions (HEIs). As it has been argued in the literature, universities in Chile are far from being considered research-oriented institutions. Current governmental reforms have put pressures on the efficient use of public resources,…

In 2011, state legislators in Arkansas passed Act 1203, effectively enacting performance-based funding models for all state-run institutions of higher education. Over a period of five years beginning in 2013-14, 25 percent of every institution's base funding will be allocated according to performance. Under the direction of the Arkansas Department…

The mere mention of so-called "performance funding" makes college presidents and the higher education community nervous. It's an understandable reaction to a concept that too often results in an overly complex outcome. Still, the basic principle of "investing the limited resources states have in the results they want" is fundamentally sound--and…

Performance-based funding is a system based on allocating a portion of a state's higher education budget according to specific performance measures such as course completion, credit attainment, and degree completion, instead of allocating funding based entirely on enrollment. It is a model that provides a fuller picture of how successfully…