# A User's Guide to the Grading and Methodology

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## Behind the Numbers

Quality Counts grades all 50 states in two key categories of school finance: overall spending on K-12 and equity, or just how fairly and evenly that money is distributed throughout a particular state.

But what's behind those top-line numbers and letter grades? Here's how it's done:

• The Education Week Research Center collects the most recently available federal data from the Census Bureau, the U.S. Department of Commerce, and other sources—2015 data, in this case—to get a more detailed look at how much states spend on their public schools and how they go about spending it.

• The states get scored and graded on eight separate indicators. Four of them deal with spending levels alone, and the other four on just how that funding gets spent, with an eye toward equity.

• To make sure things are comparable, the researchers adjust some of these indicators for factors like regional cost differences and for students who may be more expensive to educate, such as low-income children and those with disabilities.

• All of these calculations then are blended for each state's final A-F grade and numerical score.

Some of these school finance indicators are easy to grasp. Others are more technical. Here's a quick and easy guide to the grading scale and each of the eight indicators that make up the school finance grade. For more detail, see this report's full sources and notes at www.edweek.org/go/qc18sources.

Each state receives a numerical score for each of the indicator categories. After rounding scores to the closest whole-number values, we assign letter grades based on a conventional A-F grading scale, as follows:

A = 93 to 100
A-minus = 90 to 92
B-plus = 87 to 89
B = 83 to 86
B-minus = 80 to 82
C-plus = 77 to 79
C = 73 to 76
C-minus = 70 to 72
D-plus = 67 to 69
D = 63 to 66
D-minus = 60 to 62
F = Below 60

# Glossary

## Wealth-Neutrality Score

Do tax-poor districts get left behind when it comes to school spending? This indicator offers some clues. It looks at two points: how much local property wealth a district has, and how much it actually spends on schools from local and state sources. A negative score means that poorer districts actually have more funding than richer ones on a statewide basis. And Alaska, despite having many poor, far-flung districts, comes out on top with a score of minus 0.242.

## McLoone Index

Just how balanced is district-by-district spending within a particular state? Think of the McLoone Index as a yardstick. Named after the late University of Maryland school finance professor Eugene McLoone, it measures how far a state has to go to assure that every district is at least at the spending midpoint compared with other districts. Perfect equity is defined as a score of 100. For example, a state with a score of 95 is closer to this target than a state with a 75.

## Coefficient of Variation

Which states have the most uneven terrain when it comes to school funding? This indicator measures variations in spending between districts in each state. Some states are "flatter," meaning many of their districts are clustered more closely together when it comes to spending. Others have a lot of peaks and valleys in districts' K-12 funding. In this case, a perfect score is zero, and the higher the score, the more variation.

## Restricted Range:

How wide is the gap between the best-funded and worst-funded districts in a state? This indicator captures—in actual dollars—the funding difference between the highest- and lowest-spending school districts in each state. Alaska has the biggest gap, a whopping \$22,540 between its top-spending districts and the lowest ones. That difference is due, at least in part, to geographical factors in the huge, rural state.

## Per-Pupil Expenditures:

This tally of per-student spending by state is adjusted for regional cost differences across states. It captures factors like teacher and staff salaries, classroom spending, and day-to-day operations and administration, but not construction and other capital expenditures.

## Percent of Students in Districts Spending at or Above the U.S. Average:

This indicator shows that all students in only seven states and the District of Columbia attend school in districts that spend at least the national average on K-12.

## Spending Index

Here's another way of looking at per-student spending: This index shows just how close a state's school districts come in meeting the national per-pupil average—or, depending on your perspective, the degree to which lower-spending districts fall short of that national benchmark. In states that scored 100 percent, all districts met or cleared that bar.

## Taxable Resources Spent on Education

This indicator shows just how big a bite of a state's taxable resources K-12 education takes. It's based on state and local revenues and the gross state product as reported in federal data.

For more detail on the Education Week Research Centers methodology and sources, click here.

Vol. 37, Issue 34, Pages 19-21

Published in Print: June 6, 2018, as Quality Counts 2018: Grading Scale and Methodology
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