Leading the Future of the Public Sector: The Third Transatlantic Dialogue University of Delaware, Newark, Delaware, USA May 31—June 2, 2007 Workshop 5: Leadership and the New Public Management Creating an Environment for Accountability and Performance in Contractual Arrangements: Leadership or Mandate? Maria P. Aristigueta and Lynne R. Foote Contact for correspondence: Maria P. Aristigueta School of Urban Affairs and Public Policy University of Delaware Newark, DE 19711 USA mariaa@udel.edu (302) 831-4570 ABSTRACT Devolution and the New Public Management has increased the privatization of government service and enhanced the role for the nonprofit sector in the United States. Performance contracts are viewed as a method for holding service providers accountable for outcomes. This paper outlines the findings of a two year study which took place at the University of Delaware between September 2005 and April 2007, entitled The Forward Together Project. Ad hoc implementation of performance contracts are found in the state; some as a result of federal mandates, others as championed by leadership. Ingredients desirable for successful performance contracts are explored in this paper. Although the research cannot conclusively attribute performance contract to more effective and efficient service delivery, it does provide evidence of expanded use of performance contracts and the potential for improved accountability and service delivery relationship between state government and nonprofits. 1