Since 2003, eight states have enacted legislation creating PIF programs. These programs are premised on the idea that if the supervision agency or locality sends fewer lower-level offenders to prison—thereby causing the state to incur fewer costs—some portion of the state savings should be shared with the agency or locality. With PIF, agencies or localities receive a financial reward for delivering fewer prison commitments through reduced recidivism and revocation which, in turn, must be reinvested into evidence-based programs in the community.

report recently published by the Vera Institute outlines how PIF programs can lead to better offender outcomes while reducing overall corrections costs. The report describes the problem of misaligned incentives, lays out key objectives of PIF programs, offers lessons learned by the pioneering states, and highlights important decision points to help policymakers design their own PIF approach.

Why are states implementing PIF programs?

Although all community supervision agencies strive to achieve successful results, there are few, if any, incentives to do so. In fact, disincentives abound: the costs (in terms of time and money) of supervision; and the negative political consequences should an offender commit a high-profile crime while under supervision. Compounding the problem, the high failure rates of those on supervision and the absence of successful programs regularly lead prosecutors and judges to favor imprisonment over community-based sentences.

PIF programs address the structural disconnection within correctional systems by adding logical fiscal incentives to the mix. PIF programs can produce positive benefits for key stakeholders: states reduce the costs of building and operating prisons; agencies receive funding to fortify their community supervision programs; and public safety improves through reductions in recidivism, crime, and revocation rates.