This study focused on Texas House Bill 51 (TX HB 51) and its impact as a performance-based funding policy. Specifically, TX HB 51 incentivized regional comprehensive institutions towards high research activity in pursuit of academic excellence and nationally recognized prestige. Employing critical policy analysis, we considered the societal and economic costs of the state priorities that informed TX HB 51 for various stakeholders across the state. Through this lens, we offered a critical interrogation of the potentially negative economic and social impacts of this funding mechanism through a lens that considers historical and persistent racial inequity and power differentials across dominant and non-dominant groups within U.S. society at large.