Standard & Poor's Finds 65% Target
Has No Effect on Student Achievement

Standard & Poor's, the highly regarded credit ratings service, crunched the numbers and found there is no correlation between the "65 Percent" funding formula and student achievement.

S&P analysts first studied the data in the fall of 2005 in nine states then considering some form of the 65 Percent Solution and found "no significant positive correlation between the percentage of funds that districts spend on instruction and the percentage of students who score proficient or higher on state reading and math tests."

The data is presented on S&P's SchoolMatters Web site, which it operates as a service. Standard & Poor's does not take a position for or against the proposal.

The original study, The Issues and Implications of the "65 Percent Solution," (PDF, 165KB, 15 pages) stated:

Although there are a number of districts that spend more than 65% on instruction and achieve above-average proficiency levels, there are many districts that exceed the 65% goal and achieve below-average proficiency rates. Interestingly, some of the highest performing districts spend less than 65%, and some of the lowest-performing districts spend more than 65%. Student performance does not noticeably or consistently increase at 65%, or any other percentage spent on instruction.

Responding to requests from additional states, the S&P analysts studied an additional 25 states for which SchoolMatters has the requisite data. The study reached the same conclusion:

The analysis in this addendum corroborates Standard & Poor's conclusion in the original paper that there is no significant correlation between the percentage spent on instruction (i.e., the district's instructional spending allocation) and student proficiency rates on state reading and math tests.

Standard & Poor's makes it clear in the original report that it is not contending that how much school districts spend doesn't matter, noting that "in fact, allocating more money to instruction is a laudable goal."

"However," the report states, "mandating a specific spending allocation is not likely to provide a 'silver bullet' solution to raising student achievement. The wide range in districts' academic proficiency rates at any given spending allocation suggests that the specific ways that school districts use their instructional dollars may have as much, if not more, of an impact on student achievement as the percentage of dollars spent in the classroom."

Standard & Poor's is the world's leading provider of independent credit ratings, indices, risk evaluation, investment research, data, and valuations. It operates SchoolMatters as a service designed to provide policymakers, educators, and parents with information "they need to make better-informed decisions that improve student performance."