One of the great puzzles of performance funding in higher education is that it has been both popular and unstable. Between 1979 and 2007, 26 states enacted it, but 14 of those states later dropped it (though two recently reestablished it).
To shed light on the causes of this instability, the authors examined three states that have experienced different forms of program cessation—Illinois, Washington, and Florida. This analysis drew upon interviews and document analyses to understand the factors that resulted in all three states abandoning performance funding.
The study uncovered several common features in the demise of performance funding in these states: a sharp drop in higher education funding, a lack of support by the higher education institutions, loss of key supporters in government, weak support from the business community, and the establishment of performance funding through a budget provision rather than a statute.
The final section of this paper discusses the implications of these findings for advocates of performance funding.
