Answering Questions on the Costs of NCLB
Over the past 10 years, costing-out studies have been
performed in more than two dozen states determine the
funding levels required to provide students with adequate
educational opportunities. Since the “No
Child Left Behind” Act (NCLB) became law in
2002, however, studies in only two states have assessed
the costs of implementing the Act beyond merely administrative
costs. In Ohio, a study was commissioned by the State
Department of Education and released in January of 2004.
It found that NCLB would cost Ohio $1.447 billion more
per year to implement in the very early grades (K-3),
including the costs of intervention services to help
move students up to mandated achievement levels. Two
scholars have now released a study that attempts to
determine the cost of implementing NCLB in Texas, and
to thereby determine whether it is, as is often charged,
an “unfunded mandate.”
The Study
Researchers from San Diego State University and the
LaFollette School of Public Affairs at the University
of Wisconsin-Madison have used a statistical approach
to determining the costs associated with raising achievement
levels in Texas to reach interim NCLB goals. In “Does
No Child Left Behind Place a Fiscal Burden on States?
Evidence from Texas,” they use a cost function
which “allows [them] to quantify the relationship
between per-pupil spending for education, student performance,
various student characteristics, and the economic and
spatial characteristics of school districts.”
Once this cost function is determined, it can be applied
to the increased costs of achieving the required higher
test scores. The researchers took into account student
characteristics such as race, income, English proficiency,
and enrollment in special education programs, and made
efforts to isolate factors out of the control of districts,
such as regional cost-of-living differences. Student
performance was measured by looking at the change in
passing rates that each district makes in a given year.
By using all of these factors to create a cost index,
the study attempted to identify a reasonable estimate
of the cost of improving a given district’s passing
rates to the levels designated by the state under NCLB.
The Results
The study determined that for all districts in Texas
to make adequate yearly progress (AYP) in 2005-2006
only, Texas would need to increase its annual education
spending by $1.65 billion. When the same cost function
is used to determine costs for reaching 70 percent proficiency,
an achievement target that will soon be required, the
cost rises to $4.67 billion, 16.7 percent of the state’s
total public school revenue for 2004.
The researchers also list several reasons why they
have most likely underestimated the costs of meeting
the state’s NCLB targets: (1) they did not have
sufficient data to determine student achievement within
disaggregated subgroups, as required by NCLB, which
would likely have dramatically increased the cost of
improving test scores in some districts; (2) the study
used an average of math and reading scores, while NCLB
requires students to pass both math and reading separately,
thus increasing the likelihood that a district would
miss requirements for one of these two subjects and
need to provide remedial services; (3) the study does
not even consider science and social studies tests,
which will be required beginning in 2007 and are likely
to bring more costs to school districts.
Is the Mandate Under-funded?
Once the increased costs of NCLB were calculated, the
researchers tried to determine whether NCLB is under-funded,
as many critics allege. By comparing the $1.7 billion
increase in costs incurred by NCLB with the $519 million
increase in Title I funds sent to Texas since the passage
of NCLB, it seems clear that there is a large gap in
funding. This gap is compounded by the fact that the
study considered only those schools not meeting NCLB
requirements, while 16 percent of current Title I allocations
go to districts that are already achieving at mandated
levels. In fact, some failing districts have actually
lost funding over the years since NCLB was enacted.
Numerically it seems evident that the federal requirements
were not supported with federal funds.
The study further explores this topic by considering
whether NCLB mandates any changes that would not have
been mirrored by independent state changes in policy
absent the Act. The researchers conclude that, given
the weak financial status of most states at this time,
it is unlikely they would enact any such sweeping and
expensive reforms. The researchers close by concluding,
“There is little question that these extra costs
will place a substantial fiscal burden on state governments.
The unanswered question is how the costs of improving
public education in the U.S. should be split between
the federal government and the states.”
Broader Implications
As states nationwide continue to struggle with the requirements
of NCLB, some are also working to quantify the costs
associated with fully achieving its goals. The current
study successfully addresses the question of whether
or not NCLB is under-funded, but if the arguments over
federal contributions to education become more contentious,
it is likely that more specific figures will be demanded.
Such figures will need to take into account costs associated
with designing, implementing, grading, and reporting
testing systems, and might also consider the cost burden
associated with the sanctions put in place by NCLB,
such as Supplemental Educational Services and transfers.
Additionally, the scope of this study is limited to
the 2005-2006 school year, along with an unspecific
future goal. Future costing-out studies may also consider
calculating the costs of carrying NCLB all the way through
until 2014, when the Act requires that all students
in every state reach 100 percent proficiency on state
academic standards.
Prepared by Nelly Ward, November 5, 2004
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