The ESEA was created to improve the academic achievement of disadvantaged children. The Improving America’s Schools Act of 1994, which reauthorized ESEA, required states to develop state academic content standards, which specify what all students are expected to know and be able to do, and academic achievement standards, which are explicit definitions of what students must know and be able to do to demonstrate proficiency. In addition, the 1994 reauthorization required assessments aligned to those standards. The most recent reauthorization of the ESEA, the No Child Left Behind Act of 2001, built on the 1994 requirements by, among other things, increasing the number of grades and subject areas in which states were required to assess students. NCLBA also required states to establish goals for the percentage of students attaining proficiency on ESEA assessments that are used to hold schools and districts accountable for the academic performance of students. Schools and districts failing to meet state proficiency goals for 2 or more years must take actions, proscribed by NCLBA, in order to improve student achievement. Every state, district, and school receiving funds under Title Part A of ESEA—the federal formula grant program dedicated to improving the academic achievement of the disadvantaged—is required to implement the changes described in NCLBA. ESEA assessments may contain one or more of various item types, including multiple choice, open/constructed response, checklists, rating scales, and work samples or portfolios. GAO’s prior work has found that item type is a major factor influencing the overall cost of state assessments and that multiple choice items are less expensive to score than open/constructed response items. Figure 1 describes several item types states use to assess student knowledge. NCLBA authorized additional funding to states for these assessments under the Grants for State Assessments program. Each year states have received a $3 million base amount regardless of its size, plus an additional amount based on its share of the nation’s school age population. States must first use the funds to pay the cost of developing the additional state standards and assessments. If a state has already developed the required standards and assessments, NCLBA allows these funds to be used to administer assessments or for other activities, such as developing challenging state academic standards in subject areas other than those required by NCLBA and ensuring that state assessments remain valid and reliable. In years that the grants have been awarded, the Grants for Enhanced Assessment Instruments program (Enhanced Assessment grants) has provided between $4 million and $17 million to several states. Applicants for Enhanced Assessment grants receive preference if they plan to fund assessments for students with disabilities, for Limited English Proficiency (LEP) students or are part of a collaborative effort between states. States may also use other federal funds for assessment-related activities, such as funds for students with disabilities, and funds provided under the American Recovery and Reinvestment Act of 2009 (ARRA). ARRA provides about $100 billion for education through a number of different programs, including the State Fiscal Stabilization Fund (SFSF). In order to receive SFSF funds, states must provide certain assurances, including that the state is committed to improving the quality of state academic standards and assessments. In addition, Education recently announced plans to make $4.35 billion in incentive grants available to states through SFSF on a competitive basis. These grants—referred to by Education as the Race to the Top program—can be used by states for, among other things, improving the quality of assessments. Like other students, those with disabilities must be included in statewide ESEA assessments. This is accomplished in different ways, depending on the effects of a student’s disability. Most students with disabilities participate in the regular statewide assessment either without accommodations or with appropriate accommodations, such as having unlimited time to complete the assessments, using large print or Braille editions of the assessments, or being provided individualized or small group administration of the assessments. States are permitted to use alternate academic achievement standards to evaluate the performance of students with the most significant cognitive disabilities. Alternate achievement standards must be linked to the state’s grade-level academic content standards but may include prerequisite skills within the continuum of skills culminating in grade-level proficiency. For these students, a state must offer alternate assessments that measure students’ performance. For example, the alternate assessment might assess students’ knowledge of fractions by splitting groups of objects into two, three, or more equal parts. While alternate assessments can be administered to all eligible children, the number of proficient and advanced scores from alternate assessments based on alternate achievement standards included in Adequate Yearly Progress (AYP) decisions generally is limited to 1 percent of the total tested population at the state and district levels. In addition, states may develop modified academic achievement standards—achievement standards that define proficiency at a lower level than the achievement standards used for the general assessment population, but are still aligned with grade-level content standards—and use alternate assessments based on those standards for eligible students whose disabilities preclude them from achieving grade-level proficiency within the same period of time as other students. States may include scores from such assessments in making AYP decisions but those scores generally are capped at 2 percent of the total tested population. States are also required to include LEP students in their ESEA assessments. To assess these students, states have the option of developing assessments in students’ native languages. These assessments are designed to cover the content in state academic content standards at the same level of difficulty and complexity as the general assessments. In the absence of native language assessments, states are required to provide testing accommodations for LEP students, such as providing additional time to complete the test, allowing the use of a dictionary, administering assessments in small groups, or simplified instructions. By law, Education is responsible for determining whether or not states’ assessments comply with statutory requirements. The standards and assessments peer review process used by Education to determine state compliance began under the 1994 reauthorization of ESEA and is an ongoing process that states go through whenever they develop new assessments. In the first step of the peer review process, a group of at least three experts—peer reviewers—examines evidence submitted by the state to demonstrate compliance with NCLBA requirements, identifies areas for which additional state evidence is needed, and summarizes their comments. The reviewers are state assessment directors, researchers, and others selected for their expertise in assessments. After the peer reviewers complete their review, an Education official assigned to the state reviews the peer reviewers’ comments and the state’s evidence and, using the same guidelines as the peer reviewers, makes a recommendation on whether the state meets, partially meets, or does not meet each assessment system critical element and on whether the state’s assessment system should be approved. A group of Education officials from the relevant Education offices—including a representative from the Office of the Assistant Secretary of Elementary and Secondary Education—meet as a panel to discuss the findings. The panel makes a recommendation about whether to approve the state and the Assistant Secretary makes the final approval decision. Afterwards a letter is sent to the state notifying them of whether they have been approved, and—if the state was not approved— Education’s letter identifies why the state was not approved. States also receive a copy of the peer reviewers’ written comments as a technical assistance tool to support improvement. Education has the authority to withhold federal funds provided for state administration until it determines that the state has fulfilled ESEA assessment requirements and has taken this step with several states since NCLBA was enacted. Education also provides states with technical assistance in meeting the academic assessment requirements. ESEA assessments must be valid and reliable for the purposes for which they are intended and aligned to challenging state academic standards. Education has interpreted these requirements in its peer review guidance to mean that states must show evidence of technical quality—including validity and reliability—and alignment with academic standards. According to Education’s peer review guidance, the main consideration in determining validity is whether states have evidence that their assessment results can be interpreted in a manner consistent with their intended purposes. See appendix III for a complete description of the evidence used by Education to determine validity. A reliable assessment, according to the peer review guidance, minimizes the many sources of unwanted variation in assessment results. To show evidence of consistency of assessment results, states are required to (1) make a reasonable effort to determine the types of error that may distort interpretations of the findings, (2) estimate the likely magnitude of these distortions, and (3) make every possible effort to alert the users to this lack of certainty. As part of this requirement, states are required to demonstrate that assessment security guidelines are clearly specified and followed. See appendix IV for a full description of the reliability requirements. Alignment, according to Education’s peer review guidance, means that states’ assessment systems adequately measure the knowledge and skills specified in state academic content standards. If a state’s assessments do not adequately measure the knowledge and skills specified in its content standards or if they measure something other than what these standards specify, it will be difficult to determine whether students have achieved the intended knowledge and skills. See appendix V for details about the characteristics states need to consider to ensure that its standards and assessments are aligned. In its guidance and peer review process, Education requires that—as one component of demonstrating alignment between state assessments and academic standards—states must demonstrate that their assessments are as cognitively challenging as their standards. To demonstrate this, states have contracted with organizations to assess the alignment of their ESEA assessments with the states’ standards. These organizations have developed similar models of measuring the cognitive challenge of assessment items. For example, the Webb model categorizes items into four levels—depths of knowledge—ranging in complexity from level 1— recall, which is the least difficult for students to answer, to level 4— extended thinking, which is the most difficult for students to answer. Table 1 provides an illustration, using the Webb model, of how depth of knowledge levels may be measured.