Student Success a “Required Course” with Performance-Based Funding

Colleges have always had a vested interest in seeing their students succeed. That’s their “reason to be.” Universities and colleges whose students experience high levels of success enjoy the reputation boost, the fulfillment of its mission, reliable tuition-revenue, and do not need to scramble to fill gaps in their graduating classes. Those perks are enough to drive any institution to keep an eye on student success.

For most states, it’s not just the perks, but the penalties that drive student success efforts. The concept of performance-based funding is simple enough. The idea is that, instead of simply receiving funding based on initial full-time enrollment (as many do), there will be contingencies for how effectively colleges are helping students succeed after they’ve arrived. According to the National Conference of State Legislatures (NCSL), “Thirty-two states.. are currently transitioning to some type of performance funding, meaning the Legislature or governing board has approved a performance funding program and the details are currently being worked out.”

In a recent article in The Chronicle of Higher Ed titled “The Path to Change Now Runs Through the Provost Office”, Dr. José Cruz, the Provost at Cal State-Fullerton University discussed California moving toward a performance-based funding model for its higher-education system. Mr. Cruz says, “We’re looking to position ourselves for when that day comes by ensuring that our internal investments are guided to those people and programs that will position us well for whatever the metrics are.”

So what are those metrics? The National Conference of State Legislators provides information on each state and their funding requirements around graduation rates and success.



(courtesy of


We’re already seeing customers pay close attention to the metrics outlined by their state’s legislature, but if you aren’t already, they’ve created a webpage that makes it very easy to see where your state falls along the spectrum of performance-based funding.


The tables provided give the policy’s status, a summary of the policy, the metrics included, and actually link directly to the legislature. (courtesy of


Followers of other industries may be familiar with this practice, since it is already in place among healthcare providers like Dartmouth-Hitchcock Medical Center. However, just as they have proactively avoided the potential penalties associated with performance-based funding, everyone is in a position to get a handle on these metrics before they incur the costs. To see how Ball State University avoided their state’s penalties, you can take a look at this case study presented by Dr. Kay Bales.

To see the entire list of performance funding initiatives, visit the NCSL website