Many states have used professional judgment panels to determine the resources schools need to meet certain performance targets. This study initiates a critical study of that method. Using budget simulations with hypothetical schools, we collected the judgments of forty-five principals about how school budgets should be allocated and how school resources affect student achievement. We found considerable variation among principals in both budget allocations and achievement predictions. We also found that principals were more optimistic about student achievement than is warranted by either achievement in comparable schools or recent research on the relationship between resources and achievement.