Performance-based funding /

While the prevalence of PBF is increasing in the U. S., it is important to note that this is by no means a panacea to reductions in government funding and issues of long-term sustainability. [...] Page 4 of 30 Prevalence of Performance-Based Funding in the United States According to Friedel et al., (2013) at the Education Policy Centre at the University of Alabama, 22 states have a funding formula in place that provides some amount of funding based on performance indicators. [...] Because of these immediate impacts, performance funding produces intermediate institutional changes in the form of greater use of data in institutional planning and policymaking and in changes in academic and student services policies and practices that promise to improve student outcomes. [...] During the first year of the new system’s operation in fiscal 2011-2012, funding for universities was based on the following indicators: • Student accumulation of 24, 48 and 72 hours of credit3; • Research and service expenditures; • Degrees awarded (bachelor’s and associate, master’s and education specialist, and doctoral and law degrees); • Degrees per full-time equivalent (FTE) student; • Trans [...] Implementation of the Tennessee PBF System In order to build understanding in the new model, and to allow for institutions to see the stability of the model, the formula was back-tested by THEC by simulating the formula calculations for three years prior.