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Performance-Based Budgeting Gaining Interest among States

Eleven states have begun adopting the performance-based budgeting method to distribute budget funds contingent on the measured success of some programs. Known as the “Results First Initiative,” the process calculates a program’s past performance to determine whether a specific budget item is worth the expense.

While advocates believe the approach adds accountability and cost-outcome analysis to all state government levels, results so far have been mixed. Since accountability is weighed heavily in the process, success is also measured on compliance by state leaders and agencies when implementing the approach, as well as the projected economic conditions. According to a National Association of State Budget Officers analysis this year, there is growing interest in performance budgeting methods, but it remains a challenge to effectively link performance information to funding decisions at all government levels.

Cherry Bekaert offers performance measurement services for both local and state governments. Check our Government industry page for details.

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