Most good teachers do not do the things that they do that are above and beyond their contract so that they can be rewarded. They do it because it is the right thing to do. That is not how most teachers are wired. When I paid for things out of my own pocket for my students or for my own classroom, I did it because it needed to be done...not because I was looking for a reward or a Bozo button.
If legislators or schools districts really want to reward teachers, perhaps the best way would be to afford them respect as professionals by providing positive working conditions, by making sure that class sizes are small, by providing salaries that are commensurate with their education and experience level, by providing adequate social services to help children, by funding districts equitably, and by listening to educators’ concerns about developmentally and instructionally appropriate methods of teaching.
Merit pay and performance payouts pit teachers against one another. Whether the intent was to reward teachers in specific zip codes, I cannot say, but whatever the case, the result is yet another slap in the face to those who work in the “wrong” district.