Hoover Daily Report

The Cost of a Proficient Student

Monday, December 23, 2002

Fourth grade marks the point that proficient students stop learning to read and start reading to learn. A federal achievement survey performed by the National Assessment of Educational Progress (NAEP) estimates that in 1998 only 29 percent of fourth graders attained such proficiency. Lack of reading skills reduces students' chances of thriving academically and graduating from high school.

Failure cannot be blamed on low spending. State-level per-student expenditures ranged from $3,969 in Utah to $9,643 in New Jersey. Taxpayers could reasonably expect that such investments would produce academically proficient fourth graders, whom the NAEP defines as demonstrating "solid academic performance" and being well prepared for fifth-grade work.

U.S. taxpayers spent an average of $107,000 to produce a proficient fourth-grade reader in 1998, the latest year for which data are available. According to the U.S. Department of Education, the annual per-student cost of K–12 public education was $6,189 for the 1997–98 school year. Thus, by fourth grade, the cumulative U.S. taxpayer investment in a child's public education is five years at roughly $6,189 a year, or $30,945.

Given that the expenditure of $30,945 per pupil produced only twenty-nine proficient readers out of every one hundred, the cost per proficient fourth-grade reader is $30,945 divided by 29 percent, or about $107,000. This calculation provides a cost index of how productively each state is using its tax dollars to produce proficient fourth-grade readers.

The three states with the highest costs per proficient fourth-grade reader are Hawaii ($172,000), with just 17 percent of Aloha State students reading at a proficient level; New York ($153,000), with 29 percent; and Delaware ($148,000), with 25 percent. New York and Delaware deliver only mediocre reading proficiency despite being among the top six states in the nation in per-pupil spending. The highest cost by far was in the District of Columbia, where the cost of producing a proficient fourth-grade reader was $420,000—six times higher than in Utah.

The three states with the lowest cost per fourth-grade reader are Utah ($70,900), with 28 percent of Beehive State students reading at proficient or above; Montana ($77,400), with 37 percent; and New Hampshire ($81,000), with 38 percent. Montana and New Hampshire achieve substantially higher than average proficiency rates at lower than average costs. Data from every state can be found at http://www.hoover.org/pubaffairs/we/2002/walberg_1202table.html.

The new federal No Child Left Behind Act requires annual testing of all third through eighth graders. It will allow more timely comparisons not only of states but also of school districts and even schools. Other interesting calculations would be the costs of proficient algebraists by eighth grade and by high school graduation.

The cost per proficient student provides a usefully compact index to track the efficiency of schools because it combines effectiveness with cost, both of which are important to taxpayers who want to know the value of what their tax monies buy. Furthermore, they ought to be able to compare one school, school district, or state with another and to ask legislators and educators for an explanation of the comparative standings.

Table: Cost per Proficient Fourth-Grade Reader