The Vera Institute of Justice and Performance Incentive Funding: Aligning Fiscal and Operational Responsibility to Produce More Safety at Less Cost


The Vera Institute of Justice is an independent, nonpartisan, nonprofit center for justice policy and practice that conducts projects and reform initiatives, typically in partnership with local, state, or national officials, across the United States and around the world. The Vera Institute combines expertise in research, demonstration projects, and technical assistance to help leaders in government and civil society improve the systems people rely on for justice and safety. The Vera Institute's Center on Sentencing and Corrections (CSC) specifically focuses on helping government leaders advance criminal justice policies that promote fairness, protect public safety, and ensure that limited resources are allocated efficiently. The research and analysis services that CSC offers help sentencing and corrections officials confront new challenges and understand their jurisdictions’ operations to identify opportunities to reform and increase operational efficiency. In September 2011, the Vera Institute, in partnership with the Pew Center on the States and Metropolis Strategies, hosted a conference on performance incentive funding (PIF) programs. The goal of the conference was to understand key challenges to implementing PIF programs and share best practices for achieving program success with key stakeholders. The final report, released in November 2012, highlights the importance of incorporating evidence-based practices into the incentive funding structure and providing agencies and localities with the resources and support needed to pursue the program’s goals. Laura Baynton, Head of Youth Justice Strategy for the Youth Justice Board in England and Wales, has already begun incorporating the findings of the PIF report into her organization’s discussions and future planning. Ms. Baynton explains, “I came across Vera’s PIF report recently when visiting the United States as part of a Churchill Fellowship to explore youth justice innovation overseas. The report was very helpful in summarising and explaining approaches to performance incentive funding, and the Vera Institute was very helpful and open in discussing the report and their work with me. I found it very useful in aiding my understanding, and it will be of real value to my colleagues back home.” Those stakeholders looking for a better understanding of PIF programs should refer to the report, which describes the structural flaw of misaligned corrections incentives, outlines key objectives of PIF programs, offers lessons learned by pioneering PIF states, and highlights important decision points to help policymakers design their own PIF approach.

Summary of the Performance Incentive Funding Report

While policymakers and scholars often attribute the United States’ high incarceration rate to a wide variety of reasons, there is a structural flaw in the U.S. criminal justice system that has fueled prison growth but is often overlooked. Currently, our criminal justice system indirectly incentivizes courts, parole agencies, and probation officials to place struggling, low-level offenders behind bars. This unintentional incentive is the result of the state bearing the costs of incarceration, while local decisionmakers make the decision whether to send offenders to prison or supervise them in the community; the latter of which is paid for at the local level. To combat this issue, states and local jurisdictions are working in concert to identify solutions that provide lower-level offenders with alternatives to incarceration and restructure how the criminal justice system incentivizes the courts and probation and parole agencies. One identified solution, performance incentive funding (PIF), addresses the structural disconnect within correctional systems and provides a clear set of shared objectives by aligning fiscal incentives to program goals, thereby achieving positive outcomes for key stakeholders. PIF programs are based on the premise that if the supervision agency or locality sends fewer low-level offenders to prison, causing the state to incur fewer costs, some portion of those savings should be reinvested in the agency or locality. The savings received as a financial reward for reducing recidivism and revocations must then be reinvested to support evidence-based programs within the community. With the implementation of PIF programs, states reduce the costs of building and operating prisons; local agencies receive funding to fortify their community supervision programs; and public safety improves through reductions in recidivism, crime, and revocation rates. In the past several years, eight states – Arkansas, California, Illinois, Kansas, Kentucky, Ohio, South Carolina, and Texas – have enacted legislation to create PIF programs through which community corrections agencies receive part of the state savings achieved when they improve outcomes and send fewer offenders to prison. The pilot programs in these states have demonstrated that while there are similarities among the programs, there is no one-size-fits-all approach to designing and implementing a PIF program. These states can, however, provide insight into the key challenges to and considerations for implementing PIF programs. The pilot programs have yielded promising results and identified best practices to increase the likelihood of program success. The report suggests that including multiple measures to evaluate performance and determine eligibility for incentive funding, rather than focusing on just the single outcome of reduced prison commitments, will ensure that public safety is protected while positive outcomes are still achieved. The report also highlights the importance of incorporating evidence-based practices into the structure of PIF programs and giving agencies and localities the resources necessary to implement programs successfully. The experience of some states demonstrates that a successful PIF program can significantly curb prison population growth and costs. PIF programs show promise in helping to reduce the high incarceration rate and associated costs while also investing savings in evidence-based programs that reduce recidivism and increase accountability across the corrections community. To read the full report Performance Incentive Funding: Aligning Fiscal and Operational Responsibility to Produce More Safety at Less Cost click here. To learn more about the Vera Institute of Justice, visit