Performance Budgeting and Performance Funding in the States: A States Assessment

Abstract

For a variety of reasons, performance budgeting has gained new life in the 1990s. Initially introduced in the 1950s by the Hoover Commission and others, performance budgeting efforts, in the 1990s, go beyond the workload productivity and efficiency focus of earlier phases and place greater emphasis on outcomes and accountability. This study reports on a survey of state executive-branch budget officers designed to determine the current status of state performance budgeting efforts including performance budgeting processes used by the states, their perceived impacts on budget decision making, and their probable future use. In addition, the study assessed the emerging role of performance funding as a further extension of performance budgeting processes. The linking of performance to the allocation or distribution of appropriated funds may be emerging as the next iteration of performance budgeting in the states. In addition to reporting on the survey, relationships between performance budgeting and various aspects of state budgeting practices are analyzed through crosstabulations, and regression analysis is employed to examine the states' organization, fiscal, and political capacity to implement performance budgeting and funding.