The JTPA Incentive System
Measurement and Funding
This chapter outlines the specifics of JTPA’s performance incentives, which provide necessary background information for subsequent chapters in this monograph. It also speaks generally to the challenges that must be met in formulating performance measures and incentives anywhere in government.1 In particular, we argue that the decisions about what should be measured, and how, when, and by whom it should be measured, make a critical difference for the success of incentivebacked performance measurement.
The JTPA organization was conceived in the spirit of New Federalism. Proponents of New Federalism have argued that more decentralized decision making leads to “laboratories of the states” that foster innovation and creativity and hence, in the end, superior policies. In JTPA, states indeed used their discretion to produce a wide variety of performance measurement and incentive structures. The federal government retained control over some important aspects of the incentive system. The discretion left to the states, however, was important for determining the character of performance measurement and the incentives.
By providing an analytical description of performance measurement in JTPA, this chapter complements the institutional literature on the JTPA bureaucracy (Barnow 1992; Svorny 1996). Although this literature provides a good understanding of how JTPA’s performance incentives worked at the federal level, it has little to say about its implementation at the state level. By offering a more complete description of JTPA performance incentives, this chapter lays the foundation for under-