Robert B. Stein
Missouri Coordinating Board of Education

Funding performance is not a new concept for academicians, as any faculty member who has engaged in discussions of merit pay will testify. Funding linked to group rather than to individual performance is, however, a relatively recent phenomenon that has drawn the attention of policy makers, legislators, and governors as states seek new ways to make educational policy.

While performance funding initiatives vary in shape, size, and scope, they all involve rewards for outcomes. Performance funding is based on the assumption that previously established priorities will drive funding policies and that, by rewarding results, individuals, groups, or entire institutions will be motivated to produce desired changes within the system.

Burke and Serban (1997) report increased state interest in using some form of performance funding as a strategy for improving the quality and accountability of higher education systems. The design and implementation of performance funding programs that highlight teaching and learning issues have become major challenges as states seek to balance legislative interest in productivity and efficiency measures with an emphasis on quality of student outcomes.

Missouri's Funding for Results initiative supports enhanced quality and accountability in the state's public higher education system. With support from FIPSE, a unique performance funding program is evolving in Missouri. While its use in other states will require adaptation, the lessons learned in Missouri will be helpful to institutions and states intending to use performance funding as an innovative strategy to bring about improvements in teaching and learning.

Burke, J.C. and Serban, A.M. (1997). Performance Funding and Budgeting for Public Higher Education: Current Status and Future Prospects. Albany, N.Y.: Rockefeller Institute of Government.

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