To gain a better understanding of how these systems operate, the Office of Vocational and Adult Education (OVAE), U.S. Department of Education, commissioned a study of adult education fiscal policies in selected states using performance-based funding to allocate program resources. This cross-case analysis report summarizes findings from case study site visits conducted in three states-Indiana, Kansas, and Missouri-which are among the most experienced in using performance-based funding to allocate federal, state, or both types of resources. The paper opens with an overview of funding approaches used in study states and the rationale for formula adoption. A description of the formula design process follows, including an account of the individuals involved in system development and the measures included in formula construction. The report next reviews implementation issues affecting formula rollout and the effects of performance funding on state adult education providers. It concludes with a description of key issues state administrators should consider when making the transition to performance funding.