Higher Education in California: Performance Budgeting

Overview & Synopsis

As California begins to reinvest in public higher education after several years of budget cuts, it could opt to tie funding more closely with outcomes--for example, the number of students educated or degrees awarded. This approach, known as performance-based funding, has the potential to incentivize investment by the state's higher education systems in areas that further state priorities. Drawing on California's minimal experience with performance-based funding and the approaches other states have pursued, this report raises four important questions for the state to consider if it wants to link funding for higher education with outcomes without compromising on either quality or equity. [For the companion report, "Higher Education in California: Student Costs," see ED561200. For the companion report, "Higher Education in California: Institutional Costs," see ED561201.]