The Department of Education is responsible for overseeing state implementation of NCLBA, which amended and reauthorized the Elementary and Secondary Education Act. Title I of this act authorizes funds to states for local school districts with high concentrations of children from low-income families to improve the academic achievement of students failing or at risk of failing to meet state standards. Title I is the single largest federal program supporting education in kindergarten through 12th grade, supplying over $12 billion in federal funds in 2004. These funds are designed to supplement the instructional services and support that districts and schools provide. Title I and other federal funding represent about 8 percent of total spending on elementary and secondary public education, with the remaining 92 percent provided primarily by states and localities. Title I funds are distributed by formula to state education agencies, which retain a share but pass through most of the funds to school districts. Districts with at least a minimum number and percentage of low-income students receive a share of Title I funds. The districts are required to distribute Title I funds first to schools with high poverty rates—over 75 percent—and then to eligible schools in rank order of poverty either districtwide or within grade spans. Because school enrollment numbers and demographics may vary from one year to the next and because districts have some discretion in how many and which schools receive Title I funds, the status of schools as Title I or not Title I can vary from one year to the next. Approximately 25 million students were enrolled in schools eligible for Title I funds in school year 2002-2003 out of a total of about 49 million students in all schools nationwide, according to Education. Stronger accountability for educational results is one of several education reform principles embodied in NCLBA and it builds on requirements in place under prior law. Prior to NCLBA, states were expected to have accountability systems that included standards for what students should learn and tests every year in certain grade levels to measure their knowledge of reading and mathematics. Each year, increasing percentages of students were expected to demonstrate their proficiency on these tests, and schools were judged on their ability to make adequate yearly progress in educating students to the state’s standards—referred to in this report as meeting their yearly performance goals. Title I schools that did not meet their goals for two consecutive years were to be designated for improvement, provided technical assistance, and required to implement improvement plans. States were at various stages of implementation when NCLBA was enacted, so some states had been identifying schools for improvement for several years while others were just beginning the process. Enactment of NCLBA strengthened accountability requirements by specifying timetables for school improvement and by holding all public schools, whether or not they receive Title I funds, accountable for the academic performance of various subgroups of students. For example, schools must reach yearly performance goals set by states that will result in 100 percent of students meeting state proficiency standards by school year 2013-2014. In addition to meeting the state’s performance goals in general, schools are responsible for meeting those goals for specified subgroups of students who (1) are economically disadvantaged, (2) represent major racial and ethnic minorities, (3) have disabilities, or (4) are limited in English proficiency. If any subgroup does not meet the target, the school is identified as not having made its yearly performance goal. While NCLBA requires that all 94,000 public schools in the nation be held accountable for their performance, it requires specific actions or corrective interventions only for Title I schools that repeatedly miss their yearly performance goals. Two kinds of immediate interventions are required for Title I schools that have not met their performance goals for two consecutive years. On the one hand, plans are set in motion to improve the school’s performance. At the same time, students must be given the opportunity to transfer to other schools under the school choice option. Depending on how often schools continue to miss their goals, other required actions range from offering students supplemental educational services, such as after-school tutoring, to completely restructuring schools. See appendix II for further details on the specific actions required in each year. The first year that Title I schools do not meet performance goals, no specific actions are required under NCLBA. However, if the goal is missed the next year, districts generally must offer parents of students attending these schools the choice to transfer their child to another school. The district must provide transportation to the new school, within limits, and continue to pay for transportation until the school from which the student transferred is no longer identified for choice. Schools are no longer identified for choice when they have met their yearly performance goals for at least 2 consecutive years. Districts are required by federal regulations to offer parents at least two schools from which to choose, if available, and these schools may be any public school that is not itself currently identified for choice. Thus, under NCLBA offered schools could include Title I schools that have missed their yearly performance goals for a single year or any school that does not receive Title I funds, regardless of its performance. However, states could further limit the schools offered as transfer options, for example, by prohibiting transfers to non-Title I schools that have not met their yearly performance goals. Under circumstances where no viable transfer options exist—as in districts with only one school serving particular grade levels or where all schools in the district have repeatedly missed their performance goals—districts are required, to the extent practicable, to make arrangements with other districts to accept their transfer students. NCLBA requires that districts notify parents of the choice option by the first day of the school year immediately following the test administration that resulted in the school being identified for choice. For example, if tests given in spring 2003 resulted in the school being identified for choice, then the option had to be offered parents by the first day of school of the 2003- 2004 school year. Notices to parents must be in an understandable and uniform format and, to the extent practicable, in a language that parents can understand. These notices must explain why the school was identified for choice and how it compares with others in the district and state. In addition, federal regulations require that the notice include information on the academic achievement of the schools offered as transfer options. Districts are not required to give parents their first choice among the transfer options provided, but may not deny transfer requests based on lack of physical capacity, such as lack of space within a building or classroom, according to federal regulations. When deciding which schools to offer as transfer options, districts can consider the amount of available capacity, but they must offer options for all students enrolled in schools identified for choice. When reviewing transfer applications, making school assignments, and arranging for transportation, districts are required to give priority to the lowest-achieving low-income students. In each of the first 2 school years following enactment of NCLBA, from 10 to 12 percent of schools that received federal funds under Title I were identified for school choice. Several million students were enrolled in the schools identified for choice and were thus eligible to transfer. About 31,000 students, representing 1 percent of those eligible, transferred in the second year, school year 2003-2004. Although Education has recently begun to collect information on the number of transferring students, little is known about their demographic or academic characteristics. Our analysis of data from one district showed that proportionately fewer minority and low-income students transferred, compared with students in the same schools who did not transfer. In each of the first 2 school years of NCLBA, about 1 in 10 Title I schools— about 1 in 20 public schools nationwide—was identified for school choice. About 5,300 schools attended by 3 million children, were identified for choice in the first year of NCLBA. As shown in figure 1, the total number of schools identified for choice increased to about 6,200 in year two. Because schools must meet their performance goals for 2 consecutive years before they are no longer identified for choice, many of the same schools may have been included in the total number for both the first and second years. As figure 2 shows, Title I schools identified for choice enrolled larger proportions of minority students and students from low-income families than other Title I schools. About 60 percent of all schools identified for choice were elementary schools. However, this proportion is smaller than might be expected, given that 71 percent of all Title I schools are elementary schools. As figure 3 shows, proportionately more middle and high schools were identified for choice. Most schools identified for choice in school year 2003-2004 were located in urban and suburban areas. Although 15 percent of all Title I schools were located in rural areas, only 11 percent of the Title I schools identified for choice were in rural areas. Figure 4 shows state variation in the proportion of schools identified for choice. In the majority of states, 10 percent or fewer of Title I schools were identified for choice in 2003-2004, but in some states a much larger percentage was identified. One state, Wyoming, had no schools identified for choice in 2003-2004. Among the states with relatively few schools identified for choice were some of the nation’s most rural states, including Maine, Mississippi, and Nebraska, but also some more populous states such as Florida and Texas. By contrast, in 22 states the percentage of Title I schools required to offer choice ranged from 11 percent to 48 percent. Among these were several of the nation’s most populous states, including California, Illinois, and New York, but also one of the most rural—Alaska. Georgia and Hawaii each had 40 percent or more of their schools identified for choice, higher than any other state. See appendixes III and IV for state details for each year. A number of factors contribute to state variations in the proportion of schools identified for choice, including differences in school populations and state accountability systems.