Among states, there is growing interest in providing new incentives to community college systems for improving college completion, but there are few resources available. This brief presents a set of tools that can help states design performance-based funding systems to influence student and institutional behavior. The first tool is a set of reflections based on Ohio’s new performance-based funding system that shifted its focus from course enrollment to course completion. The second tool is a set of recommendations to guide state leaders through design and implementation issues, especially related to challenges of equity, sustainability and political buy-in. The last tool is a matrix that summarizes similarities and differences among the Achieving the Dream states that have performance-based funding for their community colleges.