State and federal funding now comes with significant strings in the form of accountability standards. Most states now require their community colleges to report data on their performance. This data plays a role in state deliberations and even funding of community colleges. In fact, between 1979 and 2006, twenty-five states had enacted performance-based funding, in which a certain portion of the state appropriation to higher education institutions is disbursed according to how well those colleges meet specific performance standards. Moreover, federal funds under the Perkins Vocational Education Act and the Workforce Investment Act carry significant performance accountability requirements. Despite this growing importance of performance accountability, we have very little information on what impact it is having on community colleges and whether it is effectively stimulating the intended behavior. Moreover, while states vary significantly in which performance funding indicators they adopt, we have little information on why and how those indicators are developed and why states have not infrequently abandoned or greatly revised their performance accountability systems.

Kevin Dougherty, Associate Professor of Higher Education at Teachers College, Columbia University, and Senior Researcher at the College's Community College Research Center, has received a two-year grant of nearly $500,000 from Lumina Foundation for Education to study state performance funding systems for higher education. This project is investigating which design features, strategies for policy enactment and implementation, and socio-political circumstances make states more likely to adopt and retain performance funding systems for higher education and to make smaller changes in funding levels and formulas for those systems.