For nearly three decades, public colleges and universities in the United States have suffered a sharp decline in the level of state funding that they receive (Chronicle, 2014). As a result, in order to remain not even competitive but simply financially stable, institutions of higher education have found it necessary to seek other means and sources of revenue. This study focuses on state funding of public two-year institutions of higher education from the years 2015 to 2018 and explores whether a relationship exists between the amount of state funding and student achievement, as determined by the variables of retention rate, graduation rate, and transfer-out rate. If it can be determined that such a relationship exists, this study may have an impact on how future state governments fund their two-year public colleges. The study discusses literature currently available related to the history of two-year institutions of higher education, as well as historical, current, and emerging funding models, and future trends of state funding. The theoretical framework of the study intersects education, government and politics, and business and highlights Bowen's (1980) revenue theory of cost and Pfeffer and Salancik's (1978) resource dependence theory. The methodology used to conduct the study included analyzing archival data utilizing Spearman's Ranked Correlation Coefficient. Based on the results, the researcher concludes that no relationship exists between the level of state funding and graduation rate, transfer-out rate, or student achievement rate. The researcher closes the study by providing a summary of key findings, implications on theory, and recommendations for future research. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com.bibliotheek.ehb.be/en-US/products/dissertations/individuals.shtml.]