The models used for funding universities today do not serve students, institutions, or states' labor market needs. Any model should include three principles: (1) Efficiency; (2) Transparency; and (3) Stability. As of today, there is not a single state successfully implementing all three principles in its funding systems. Most would be hard-pressed to claim even two. To explain why, this report scores and describes each of the most common funding models currently used by states relative to these three principles. Models will receive one credit if they do an effective job in that category, zero credits if there are structural limitations that inhibit or are counterproductive to achieving the goal, or half a credit if they fall somewhere in between. The models considered, categorized using data from a 2022 report by the State Higher Education Executive Officers Association, consist of (1) base plus, (2) institutional request, and (3) performance-based funding. While all three come with relative strengths and weaknesses, each has unavoidable downsides that make them poor choices to build upon. Fixing the problems laid out thus far does not require a radical reinvention of state policy. Decades of litigation over K-12 finance have forced states to develop, implement, and iterate funding models that tick all three priority boxes described in the previous section. While each state's implementation is different, cost-driven funding formulas have dramatically improved the efficiency, transparency, and stability of funding for K-12 school districts over time. Yet not a single U.S. state has adopted the model as its main distribution mechanism in higher education. The most likely argument against funding formulas in higher education relates to the complexity of university systems. But their funding needs are not so complicated that implementing funding formulas would even be unusually difficult. Like many things in education, the problem lies less in policy and more in politics.