Policy Impacts of Performance Funding for Higher Education at Community Colleges

What is it about?

Performance funding is a state policy that pays colleges for increasing graduation outcomes. This study finds that stronger policies that tie more funding to graduation outcomes produce an increase in short-term certificates at community colleges. These policies also produce declines in associate's degrees, which is counter-productive to the policy's aims.

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Why is it important?

As more states are using performance funding to try to improve degree completion, the policy is not necessarily effective at acomplishing its intended goals at community colleges. This study is also the first one that takes into account the strength of policies and the sophistication of policy designs.