Record Breaking Heatwave

BY
DR. MATTHEW LADNER
SENIOR ADVISOR FOR POLICY AND RESEARCH, FOUNDATION FOR EXCELLENCE IN EDUCATION
RECORD BREAKING
HEATWAVE
BABY BOOMER RETIREMENT, STUDENT ENROLLMENT
GROWTH AND THE FUTURE OF NORTH CAROLINA EDUCATION
APRIL 2016
AGE
DEPENDENCY
RATIO 2010
VS 2030
NORTH CAROLINA
+1775%
58%

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Cover: Between 2010-2030, the Age Dependancy Ratio*
in North Carolina is projected to grow by 17 percent.
*The age dependency ratio is derived by dividing the combined
under 18 and 65-and-over populations by the 18-to-64 population
and multiplying by 100.
About ExcelinEd
Founded by former Florida Governor Jeb Bush, the
Foundation for Excellence in Education (ExcelinEd) is igniting
a movement of reform, state by state, to transform education
for the 21st century economy by working with lawmakers,
policymakers, educators and parents to advance education
reform across America.

ExcelinEdRecordBreakingHeatwave:BabyBoomerRetirement,StudentEnrollmentGrowthandtheFutureofNorthCarolinaEducation
America is witnessing profound changes in the age makeup of its population. Put simply, there are more
grandparents and grandchildren, with fewer people in between.
What does that mean for North Carolina?
It means there will be increased demands on the state to cover expenses such as Medicaid, government pensions,
senior services and education. And there will be a disproportionately smaller number of working taxpayers to
cover the costs.
In other words, the same grandparents who relentlessly spoil their grandchildren will, knowingly or not, be
competing with them for scarce tax revenues in legislative budget hearings for the foreseeable future.
To support both the young and elderly, the working-age North Carolinians of the future who are sitting in today’s
classrooms, must be educated, skilled, efficient and innovative. How well their schools prepare them for the
challenges ahead will determine North Carolina’s fate.
In the past, North Carolina made substantial progress in advancing student achievement, yet that improvement
has stalled. Today too many teenagers are leaving school unprepared for college or a high-paying career. Their
potential is limited, not by innate ability, but by the ability of schools to fully tap into it.
This analysis not only contains new research on the demographic challenges facing North Carolina, but also
strategies for substantially improve the academic quality of the state’s K-12 schools at a price taxpayers can
afford. From expanding high-quality charter schools to investing in the college and career success of high
students, North Carolina needs bold and innovative changes now.
I hope you will take the time to read and fully digest this information. And then I strongly encourage you to act with
urgency. As always, we are here to assist in whatever way possible.
FOREWORD
Patricia Levesque
CEO, Foundation for Excellence in Education

CONTENTS
01 ALERT: HEAT ADVISORY
01 RISING TEMPERATURES IMMINENT IN NORTH CAROLINA
02 INCREASED HEAT INDEX BY 2030: NORTH CAROLINA’S CHANGING AGE DEMOGRAPHY
05 PARENTAL CHOICE COOLS DISTRICT OVERCROWDING
06 DEAD HEAT: NORTH CAROLINA’S RACE TO SERVE ITS NEW POPULATION
06 THE NORTH CAROLINA BUDGET AND UNCLE SAM’S BALANCE SHEET
06 STATE HEALTH CARE SPENDING AND THE ELDERLY
09 NORTH CAROLINA’S SCORES SURGED BUT STALLED AFTER 2003
10 CHARTER SCHOOL SUCCESS IN NORTH CAROLINA
13 BEATING THE HEAT: INCREASING K-12 OPPORTUNITIES INSIDE & OUTSIDE OF THE DISTRICTS
13 EXPANDED PARENTAL OPTIONS
14 INCENTIVE FUNDING
16 CONCLUSION: INNOVATION NEEDED FOR CONTINUED SUCCESS
17 SOURCES
20 ABOUT THE AUTHOR

01
RISING
TEMPERATURES
IMMINENT IN NORTH
CAROLINA
The baby boom generation, a huge cohort of 76
million Americans born between 1945 and 1964,
has long set cultural and political trends, but their
retirement may make the biggest splash of all.1
The
first baby boomers became eligible for federal early
retirement (Social Security and Medicare) benefits
in 2008. Until the year 2030, an average of American
10,000 baby boomers per day will reach the age of
65. By 2030, all surviving baby boomers will have
reached 65 years or older.
Known as “The Gray Tsunami” or “Hurricane Gray,”
the retirement of the baby boom generation will
represent an unprecedented challenge to the
American public services.2
The nation as a whole
will be impacted by this change, and North Carolina
will experience more of a direct impact than the
national average. Age demographic change will
have a large impact on public life and will require an
update of the American social welfare state.3
ALERT:
HEAT ADVISORY
Over the next 15 years, North
Carolina’s baby boomers will retire
and send their grandchildren off to
school. By 2030, the United States
Census Bureau projects North
Carolina’s percentage of elderly
residents to closely resemble
that of contemporary Florida.
Simultaneously, the Census Bureau
projects North Carolina to add
hundreds of thousands of school
aged children.4
Broadly speaking, the elderly utilize public health
spending at disproportionate rates while the young
utilize K-12 education spending. The North Carolina
budget spends the single highest percentage on
Medicaid, and the next largest on K-12 education.5
The concurrent increasing of both elderly and young
people occurring simultaneously seems certain to
require the reimagining of both health and education
delivery. Moreover, this is a process that needs to
develop sooner rather than later.
Others are noticing these trends and the important
implications for state policies. Ronald Brownstein

02
has written a series of provocative National Journal
articles about American demographic change
and inter-generational conflict under the theme
of the “Brown and the Gray.” He describes the two
massive generations: old and predominantly white
baby boomers and older vs. young and much more
ethnically diverse as two tectonic plates. The plates
collide, building seismic pressure.6
North Carolina
will see increasing intergenerational seismic
pressure. The brown and gray generations see the
world differently, and will have different funding
priorities for state government. In a scenario
where societal needs grow while resources remain
relatively scarce, this could devolve into a battle
between the old and the young, into health care
versus education.
Much of North Carolina’s working-age population in
the year 2030—when increases in elderly and young
populations will spike—sits in the state’s classrooms
right now. Today’s students will find themselves as
the working-age taxpayers responsible for a larger
number of elderly and young residents requiring
vital services—health care for the elderly and K-12
and public universities for the young. It would be in
the best interest of the state to ensure as many of
these students as possible are numerate, literate and
otherwise prepared to exercise the responsibilities
of citizenship.
Fortunately, North Carolina has a track record of
improving educational results over the last 20 years,
from adopting A-F grading to implementing the North
Carolina Read to Achieve program. Students, educators
and policymakers should continue to accelerate the
pace of this improvement to ensure that North Carolina
survives and thrives in the arduous years ahead.
Growth and innovation in education represent by far
the most amenable strategy for thriving and surviving
in a state that will simultaneously grow younger and
more elderly.
INCREASED HEAT
INDEX BY 2030: NORTH
CAROLINA’S CHANGING
AGE DEMOGRAPHY
North Carolina faces a tough transition over the next
15 years. Between people moving into the state and
North Carolina’s resident baby boom population
aging, the Census Bureau projects the state’s elderly
population will more than double between 2010 and
2030, increasing by 1,012,009 people.7
The growth in
the elderly population has a variety of public policy
implications—especially in terms of economic growth
and state health care expenses.
1,740,347
1,623,694
1,374,754
1,161,164
1,864,450 1,618,578
2,005,748 1,897,902
2,183,119 2,173,173
AGE DEPENDENCY RATIO*
(2010 VS 2030)
Age dependency ratios serve as a
measure of societal strain because both
younger and older people utilize public
services for education and health care.
Essentially, it is a measure of the number
of people riding in the cart compared to
the number pushing the cart.
Economists have found dependency
ratios to be predictive of economic
growth. When ratios are high, you have a
high percentage of people out of the work
force and a relatively small percentage of
people trying to cover the costs of their
education, retirement and health care.
*The age dependency ratio is derived by dividing the
combined under 18 and 65-and-over populations by
the 18-to-64 population and multiplying by 100.
GROWTH OF SCHOOL-AGED AND ELDERLY POPULATIONS
The 5-17 population grouping available from Census data most closely approximates the public school population. It is
clear a massive inﬂux of new students is on the way. Coupled with the vast increase in the elderly population, state
policymakers should expect to wrestle with increased demand for public education and health care spending
compounded by slower tax revenue growth.
2010
2015
2020
2025
2030
APPROX. SCHOOL-AGED POP.
(Age 5-17)
ELDERLY POP.
(Age 65+)
NORTH CAROLINA
+1775%
58%
U.S. Census Bureau Projected Growth of North Carolina’s Youth & Elderly Populations
U.S. CENSUS BUREAU, POPULATION DIVISION, INTERIM STATE POPULATION PROJECTIONS, 2005

03
Simultaneous to the growth in the elderly population,
projections also foresee an increase of 559,425
children in North Carolina’s youth population.8
The
young and the old generate per-person tax revenues
below the statewide average and generate above-
average costs to the state budget. Put differently, the
working-age population at any given point in time
bears most of the tax burden for services to the young
and old. North Carolina, along with the rest of the
nation, faces an especially challenging future.
We can predict the coming societal strain caused by
shifting age demography through what demographers
and economists call “total age dependency ratios.” To
calculate a state or nation’s total age dependency ratio,
you add the number of people aged 65 and older to
those below the age of 18, and divide by the number
of 18-64 year old residents. The basic concept is that
elderly and the young consume state services at a
higher rate, while working-aged people generate the
tax revenue to provide vital state services like health
care and education.
Broadly speaking, one can think of a total age
dependency ratio as the number of people riding in
society’s cart based upon age compared to every 100
people pushing the cart. This is not to say that every
person over the age of 65 is “dependent” or anything
of the sort. Demographers look at these figures
broadly rather than deterministically.
Generally, a low age dependency ratio entails many
working-age people and relatively few young/elderly
people. Not surprisingly, this translates to faster
rates of economic growth. Conversely, a high total
age dependency ratio translates to fewer working-
age people supporting services for a larger number
of young and elderly people.9
In the 1980s and the 1990s, the baby boom
generation tended to be in their prime earning years,
making lots of money and paying lots of taxes.
Because the baby boom had turned to baby bust in
the 1960s, there were more adults paying taxes per
children attending school in the past. The size of the
elderly population had been much smaller in the
past than what looms in the future. North Carolina
had one of the lower state total age dependency
ratios in 2010, but it will increase year by year.10
The United States Census Bureau projects North
Carolina’s total age dependency ratio to increase
from 58 percent in 2010 to 75 percent in 2030.11
AGE DEPENDENCY RATIO*
(2010 VS 2030)
Age dependency ratios serve as a
measure of societal strain because both
younger and older people utilize public
services for education and health care.
Essentially, it is a measure of the number
of people riding in the cart compared to
the number pushing the cart.
Economists have found dependency
ratios to be predictive of economic
growth. When ratios are high, you have a
high percentage of people out of the work
force and a relatively small percentage of
people trying to cover the costs of their
education, retirement and health care.
*The age dependency ratio is derived by dividing the
combined under 18 and 65-and-over populations by
the 18-to-64 population and multiplying by 100.
GROWTH OF SCHOOL-AGED AND ELDERLY POPULATIONS
The 5-17 population grouping available from Census data most closely approximates the public school population. It is
NORTH CAROLINA
+1775%
58%
AUTHOR CALCULATION USING U.S. CENSUS BUREAU, POPULATION DIVISION, INTERIM STATE POPULATION PROJECTIONS, 2005
* The age dependency ratio
is derived by dividing the
combined under 18 and
65-and-over populations
by the 18-to-64 population
and multiplying by 100.
North Carolina Age Dependency Ratio* (2010 vs 2030)

04
In 2010, for every 100 working-age people, North
Carolina had 58 people under 18 and over 65. In
2030, the Census Bureau projects that North Carolina
will have 75 young/old for every 100 working-age
people. However, the North Carolina Office of State
Budget and Management developed a separate set
of estimates for North Carolina’s age demography.
The Office of State Budget and Management foresees
a larger increase in elderly residents than the
Census Bureau, and a smaller increase in the youth
population. The figure above presents the Office of
State Budget and Management projections.
Under the Office of State Budget and Management
projections, North Carolina’s total age dependency
ratio moves to 68 percent in 2030.12
Assumptions
regarding a variety of factors (birth and death rates,
domestic migration, foreign immigration) drive the
projections, and in the end we have little alternative
but to wait and see which projection proves more
accurate. The Census Bureau has a strong overall
track record and the Office of State Budget and
Management has more recent information than
the Census Bureau possessed when it created its
projections in 2005. Ultimately only time will tell.
We find the largest difference between the Census
Bureau and Office of State Budget and Management
projections at the youth level. The Census Bureau has
released some more recent age population estimates
based upon the 2010 Census. The Census Bureau for
instance believed that North Carolina had 1,680,073
residents aged 5-17 in 2014.13
This figure is close to the
Office of State Budget and Management estimate for
5-17 year olds in 2025.14
The United States Department of Education has a
different set of estimates published in 2015 for North
Carolina’s public school population stretching out to
2024. Note that estimates for public school enrollments
vary substantially from those of the number of 5-17
year olds for a variety of reasons, including the fact
that many 18 year olds still attend K-12 schools and
children with special needs sometimes attend public
schools before age 5 and until age 21. Nevertheless, the
Department of Education estimates foresee an increase
of over 170,000 students by 2024.15
North Carolina Office of State Budget and Management Projected Growth of
North Carolina Youth (5-17) and Elderly (65+) Population
NORTH CAROLINA OFFICE OF STATE BUDGET AND MANAGEMENT, PROJECTED COUNTY TOTALS – STANDARD AGE GROUPS, 2015
1,700,767
1,653,922
1,506,953
1,243,888
1,700,951 1,778,807
1,691,266 2,061,814
1,709,697 2,314,988
2010
2015
2020
2025
2030
APPROX. SCHOOL-AGED POP.
(Age 5-17)
ELDERLY POP.
(Age 65+)

05
Uncertainty regarding the size of the student population
reinforces the desirability of allowing for K-12
education options that provide seats without public
investment in new school facilities. The Census Bureau
and the Office of State Budget and Management both
foresee large increases in North Carolina’s elderly
population. This will not only impact North Carolina’s
budget directly, but seems likely to impact it indirectly
through the federal government, as discussed in the
next section.
PARENTAL CHOICE
COOLS DISTRICT
OVERCROWDING
If the Census Bureau scenario plays out and North
Carolina has an additional 550,000 5-17 year old
residents to educate (or anything remotely close to
it), taxpayers will be financially hard pressed to build
new district school space. Home schooling, charter
schools and private choice programs can all serve as a
pressure relief valve in a high student-growth scenario
as the legislature faces the challenge of increasing
pressure for additional health care spending.
Indeed there is evidence from news reports on
individual North Carolina districts that the pressure
relief dynamic has already begun. The Dec. 8, 2015
edition of the News Observer reported that while
North Carolina’s Wake County school system added
3,880 students over the past two years, the growth has
been 1,000 students fewer than projected for each of
those years due to the growing popularity of charter
schools, home schooling and school vouchers. The
News Observer noted that the growth of alternatives
to traditional public schools has accelerated in the past
few years since North Carolina’s General Assembly
lifted a cap on the number of charter schools and
provided vouchers for students to attend private
schools under the Opportunity Scholarship Program.
The News Observer also quoted new Wake County
school board chairman Tom Benton pledging that his
district would rise to the challenge in competing for
students. “In the past, public schools could assign
students to wherever they wanted to because parents
couldn’t make a choice to leave the public schools,”
Benton said. “Now we’re trying to make every school
a choice of high quality so that parents don’t want to
leave.”16
This sentiment sits comfortably with a large
amount of empirical research showing improved
public school outcomes in schools facing increased
competition.17
For our current purposes, we move forward with the
assumption that something in between the Office
of State Budget and Management projections and
the Census Bureau projections will likely occur, with
North Carolina’s total age dependency ratio falling
somewhere between 68 percent and 78 percent, up
from 58 percent in 2010. The fact that both forecasts
foresee large increases in the elderly population will
create public funding challenges.
The Census and Office of State Budget and Management
projections contain large differences in the scale of the
increase in youth population. The experience on the
ground suggests continued enrollment growth that
is only partially offset by current choice and charter
laws. Under normal circumstances this might seem
quite satisfactory. Given the aging of the population,
normal circumstances may be in short supply in the
North Carolina budget process.
United States Department of Education
Projections on North Carolina Public
School Population, 2013-2024
Public
School
Population
School
Year
Fall 2013 1,530,600
Fall 2014 1,538,600
Fall 2015 1,546,800
Fall 2016 1,555,100
Fall 2020 1,617,500
Fall 2024 1,717,900
1,530,600
1,538,600
1,546,800
1,555,100
1,617,500
1,717,900
2013 2014 2015 2016 2020 2024
School Year (Fall)
Public
School
Population
UNITED STATES DEPARTMENT OF EDUCATION, NATIONAL CENTER
FOR EDUCATION STATISTICS, DIGEST OF EDUCATION STATISTICS
TABLE 203.20, 2015

06
THE NORTH CAROLINA
BUDGET AND UNCLE
SAM’S BALANCE SHEET
The federal government provides over 30 percent of
the total funding by state governments nationwide in
the form of matching and categorical grants. In Fiscal
Year 2014, 31.5 percent of the funds spent by the North
Carolina budget came from federal funds.18
Needless
to say, North Carolinians pay federal taxes and thus
participate in joint federal/state spending initiatives
like all other states. The ability of the state to maintain
current levels of spending, however, would be impacted
by a tightening of federal spending absent a substantial
increase in state taxes. The looming retirement of the
baby boom generation raises large questions regarding
the ability of the federal government to maintain state
spending programs.
The federal government currently carries $16 trillion
in debt and has unfunded entitlement liabilities of
$55 trillion, according to estimates from the Office
of Management and Budget and the United States
Department of Treasury, respectively.19
Ten thousand
baby boomers a day reaching retirement age raises
substantial uncertainty regarding the stability of
federal funding in the provision of vital state services
such as education and health.20
How the federal government will manage an ever-
growing cohort of individuals eligible to draw upon
Medicare and Social Security looms large over most
discussions of American age demography. It remains
an open question of how long the federal government
will maintain financial assistance for major state
spending initiatives. Lawmakers would be prudent to
expect a diminished ability for Uncle Sam to maintain
the current level of state spending.
Exactly how the federal budget drama plays out is
both uncertain, and beyond the scope of the present
paper. The looming need for the federal government
to balance expenditures, spending, taxes and
commitments alone should be enough to spur North
Carolina policymakers to seek policy innovation. These
same age demographic forces plaguing the federal
government will independently impact North Carolina.
Even if the federal government were able to maintain
current levels of financial aid to states, North Carolina
would still face increasing challenges in the form of
decreased state revenue and increased demand for
health care and education services.
STATE HEALTH CARE
SPENDING AND THE
ELDERLY
The tension between health and education spending
has already been playing out in North Carolina’s
annual budget battles, and health care spending has
been squeezing out a great deal of other spending in
advance of Hurricane Gray. Medicaid became the single
largest spending program in most state budgets years
ago, eclipsing K-12 education.21
DEAD HEAT:
NORTH CAROLINA’S
RACE TO SERVE ITS
NEW POPULATION

07
The federal government provides more of the total
funding for Medicaid than K-12, but this should not
comfort anyone. North Carolinians of course pay
federal taxes in addition to state taxes, so rapidly
increasing Medicaid costs hit them on both sides.
Moreover, the federal government’s own looming
need to cope with the retirement of the baby boom
generation creates a systemic source of risk.
People often confuse the Medicaid and Medicare
programs, and this is especially apt to happen
when discussing the elderly. In the broadest terms,
Medicare is a federal health care program for the
elderly. States do not play a role in financing or
administering the Medicare program. States do,
however, finance Medicaid. Most understand Medicaid
as a program for the poor, but a great deal of
Medicaid spending goes to the elderly.
Nationwide Medicaid spending per enrollee in
2009 was $2,313 for children and $2,926 for non-
disabled adults. Per enrollee, spending for the elderly
($13,186) stood at about seven times the per Medicaid
enrollee spending for children and adults. The elderly
and disabled have higher utilization and intensity
of use for acute care services, and the elderly and
disabled are more likely to use long-term care
services.22
Congress took action in 1988 to require states
participating in the Medicaid program to cover
health costs not covered by Medicare for low-income
residents and those holding below a certain level of
financial assets.23
One can only describe the interaction between
Medicaid and Medicare as complex. Many elderly
Americans access Medicaid in addition to Medicare.
States and the federal government jointly finance
Medicaid through a system of federal matching grants
to the states. An aging population will impact state
finances in a variety of ways, but most obviously
through the demand for Medicaid spending.
A recent analysis by Moody’s Investors Service found
that several states will face mounting demands
for health care spending due to population aging.
Moody’s identified states at particular risk due to the
size of their elderly population projections and their
current credit rating:
Controlling long-term care costs
will be a challenge for all states.
Those most at risk for higher costs
owing to projected rapid growth
in their geriatric population and
highest per-capita spending are:
Alaska (Aaa negative), Delaware
(Aaa stable), Maine (Aa2 stable),
Minnesota (Aa1 stable), New
Hampshire (Aa1 stable), North
Carolina (Aaa stable) and Oregon
(Aa1 stable).24
In 2011, only 17 percent of Medicaid spending
in North Carolina was consumed by the elderly,
compared to the national average of 21 percent.25
This in part owes to North Carolina’s relatively
small elderly population at the time. In 2010, the
percentage of the North Carolina population aged
65 and older and 85 and older both stood below
the national average.26
As detailed above, North
Carolina’s elderly population will expand steadily in
coming years.
Moody’s notes that cost control of elderly health care
has proven difficult politically. Changes to Medicaid
services at the state level require approval by the
federal government while politics in the state can
make cost containment difficult. “The electoral
power of a growing elderly population and the
political influence of long-term care providers are
hurdles to reform,” Moody’s noted.27

08
In 2000, North Carolina spent 23.6 percent of the
state budget on K-12 education and only 19.4 percent
on Medicaid. In 2014, the state spent 30.4 percent
of the budget on Medicaid and 22.4 percent on K-12
education.28
The figure to the left shows that Medicaid
funding increases have eclipsed all other spending
trends in North Carolina’s budget during this period.
K-12 has fallen slightly as a percentage of the budget.
The large increase in Medicaid spending has come
primarily at the expense of the “All Other” category
employed by the National Association of State Budget
Officers (NASBO). “All Other” spending represented
almost 27 percent of the budget in 2000, but only
17 percent in 2014. NASBO includes many types of
spending in this category, including the Children’s
Health Insurance Program (CHIP), institutional
and community care for the mentally ill and
developmentally disabled, public health, some employer
contributions to pension and health benefits, economic
development, environmental spending, state police,
parks and recreation, housing assistance and aid to
local government.29
Many North Carolinians care very deeply about these
policy areas in addition to K-12. Note that more
efficient delivery of such services deserves celebration,
especially if taxpayers experience gains in quality to
accompany efficiency gains. For instance, the aim of
a K-12 system is not to spend money but rather to
educate students to the highest possible levels with
the resources available. The budget trends leave little
room for doubt that increases in Medicaid spending
have had a “crowding out” effect on other types of
state spending—creating a need for efficiency gains in
service delivery in order to maintain the same or better
results.
As North Carolina’s population ages and its school-aged
population expands, additional pressure will be brought
to bear on K-12 budgets. Research by Massachusetts
Institute of Technology economist James M. Poterba
regarding district bond and override elections may be
of additional concern. In school spending data, Poterba
found that an increase in the elderly population in a
jurisdiction leads to a decrease in school spending per
child. Many elderly people live on fixed incomes and
thus may possess a preference to avoid tax increases.
More ominously however, Poterba’s research found a
more pronounced effect when the ethnic profile of the
elderly people varied from that of the students.30
Categories of Major Change in North
Carolina State Budget from 2000 to 2014
NATIONAL ASSOCIATION OF STATE BUDGET OFFICERS, STATE
EXPENDITURE REPORT: EXAMINING FISCAL STATE SPENDING, 2015
AND STATE EXPENDITURE REPORT, SUMMER 2001
MEDICAID
11%
2014
30%
2000
1
9%
HIGHER EDUCATION
2%
2014
15
%
2000 13%
ALL OTHER
-10%
2014
1
7%
2000
27%
K-12 -2%
2014
22%
2000
24%

09
In conclusion, North Carolina faces foreseeable
additional demand for health spending and uncertain
mid-to-long run questions concerning the supply of
federal funds. This problem looks to grow more acute
over time. Pressures will rise steadily for a higher
return on investment on K-12 spending.
NORTH CAROLINA’S
SCORES SURGED BUT
STALLED AFTER 2003
A review of the recent past may inform us to the
possibility of improving education outcomes. The good
news for North Carolinians is this has been achieved in
the past. An early adopter of academic standards and
accountability, North Carolina earned a reputation for
improving public school outcomes in the 1990s and
into the new millennium.
NAEP reports both scores and the percentage of
children reaching various achievement levels —
Below Basic, Basic, Proficient and Advanced. The
figure to the right shows proficiency rates from the
National Assessment of Educational Progress (NAEP)
on the mathematics exams for fourth and eighth
graders. Proficiency on NAEP represents a relatively
high academic bar, but one that you want as many
students as possible to clear. For some perspective,
Massachusetts achieved the highest state proficiency
rate on any NAEP exam in 2011 and 2013 with rates
of 58 percent on the NAEP fourth-grade mathematics
exam. Massachusetts has the highest NAEP scores
on all four tests and ranks relatively high among
European and Asian countries in equating studies
linking NAEP scores with international exams.31
In 1992, only 13 percent of North Carolina fourth
graders scored proficient on the NAEP mathematics
exam, and 12 percent of eighth graders scored
proficient. The performance of North Carolina students
fell well below the national average on both tests.
By the year 2003 the rate of fourth-grade math
proficiency had more than tripled, up from 13 percent
in 1992 to 41 percent in 2003. The proficiency rate
tripled at the eighth-grade level from the 1992 levels
in 2009, when the rate reached 36 percent. Looking at
the entire 1992-2015 period, North Carolina went from
being below the national average on both exams to
above the (much improved) national average at fourth-
grade math and tied with it on eighth-grade math.
North Carolina’s Statewide 4th and 8th
Grade Math NAEP Proficiency Rates
1992-2015
U.S. DEPARTMENT OF EDUCATION, INSTITUTE OF EDUCATION
SCIENCES, NATIONAL CENTER FOR EDUCATION STATISTICS, NATIONAL
ASSESSMENT OF EDUCATIONAL PROGRESS DATA EXPLORER, 2015
1992
13%
12%
21%
20%
25%
27%
41%
32%
40%
32%
41%
34%
43%
36%
45%
36%
44%
37%
1996
2000
2003
2005
2007
2009
2011
2013
1992
25%
30%
27%
30%
32%
32%
33%
29%
29%
27%
29%
28%
34%
31%
32%
29%
1994
1998
2002
2003
2005
2007
2009
2011
38%
30%
35%
33%
2013
2015
The average scale score for North Carolina students
increased between 1992 and 2003, but the pace of
improvement then slowed. North Carolina students
gained 29 points in fourth-grade math and 23 points in
eighth-grade math. The NAEP exams have a 0-500 point
scale, but even so, these gains are very impressive.
A gain of 10 points approximately equals an average
grade level worth of progress on the NAEP. So if we
gave a group of fifth graders the fourth-grade math
exam, we would expect them to do about 10 points
better than a similar group of fourth graders. Thus
during the 1992 to 2003 period, North Carolina students
succeeded in learning a great deal more math during
elementary and middle school than their predecessors.
After 2003, however, the rate of improvement slowed.
Between 2003 and 2015, mathematics improved by
two points at the fourth-grade level, and zero points at
the eighth-grade level. The momentum established in
the 1990s eventually waned in terms of spurring new
improvement. It did however succeed at moving North
Carolina from behind the national average in math to

10
ahead of it at fourth grade and tied with it at the eighth-
grade level in the most recent exam. If the state had
maintained even half of the rate of improvement seen
during the 1992 to 2003 period, North Carolina would
have boasted the highest mathematics NAEP scores in
the nation in 2015.
North Carolina students have also demonstrated
progress on the NAEP reading exams, although of
a more modest nature. On the positive side, North
Carolina displayed the highest fourth-grade reading
proficiency rate in state history in 2015. Between 1992
and 2015, North Carolina fourth graders gained 14
scale points on the fourth-grade reading test. Thus
the fourth graders of 2015 were reading at a level that
we might have seen from the average mid-year sixth
grader in 1992. In 1992 on the eighth-grade exam,
North Carolina’s proficiency rating stood unchanged
between the earliest measure, both 30 percent in 1998
and 2015. 32
The improvements in NAEP scores mirror other
improvements seen in North Carolina schools. The
four-year cohort graduation report for the Class of
2006 was 68.3 percent, but for the Class of 2014
equaled 83.9 percent.33
Higher high school graduation
rates over time have also moved to greater levels of
post-secondary success. More than 30 percent of North
Carolina residents ages 25 to 44 have a bachelor’s
degree or higher, as do 27.5 percent of residents ages
45 to 64. In comparison, only 21.6 percent of North
Carolinians age 65 or older have a bachelor’s degree or
a higher level of education.34
Without these improvements, North Carolina would
have far less shelter from Hurricane Gray. The task
ahead however remains daunting. North Carolina
needs further academic gains and needs them in
a cost effective manner. This does not necessarily
mean spending less money, but it does mean that the
state faces a growing need to increase the return on
investment for spending—the bang for the education
buck.
Some will question whether this is remotely possible.
However, North Carolina has already achieved it with
charter schools.
CHARTER SCHOOL
SUCCESS IN NORTH
CAROLINA
Academic comparisons between charter and district
schools can be fraught with peril. Apparent differences
in scores can be the result of differences in student
demographics, which cannot be perfectly controlled for
in the absence of a well-designed and executed random
assignment study. In a random assignment study, the
impact of an intervention (such as attending a charter
school) can be isolated in the random assignment of
students into a control and experimental group. In the
case of charter schools, this would entail examining
both those students who applied for admission to
45%
36%
44%
37%
2011
2013
1992
25%
30%
27%
30%
32%
32%
33%
29%
29%
27%
29%
28%
34%
31%
32%
29%
1994
1998
2002
2003
2005
2007
2009
2011
38%
30%
35%
33%
2013
2015
North Carolina’s Statewide 4th and 8th
Grade Reading NAEP Proficiency Rates
1992-2015
U.S. DEPARTMENT OF EDUCATION, INSTITUTE OF EDUCATION
ASSESSMENT OF EDUCATIONAL PROGRESS DATA EXPLORER, 2015

11
a charter school but lost the admission lottery (the
control group) to those whole applied and won.
Random assignment eliminates the possibility of large
group differences, but is very difficult to perform. A
meta-analysis of random assignment charter school
studies nationwide recently found a large majority of
studies found statistically significant test score effects
associated with charter school attendance.35
We can compare scores without a random assignment
study but must employ caution. Preexisting differences
between students can explain differences in scores.
Despite the fact that charter schools require a random
process for student admission when applications
exceed available spots, differences in application rates
can lead to differences in attendance rates across
student groups. This can be especially the case when
the charter sector is relatively small.
The National Alliance of Public Charter Schools reveals
that while North Carolina charter schools enrolled a
slightly higher percentage of black students during the
2012-13 school year, district schools enrolled a higher
percentage of Hispanic students and a somewhat
lower percentage of white students than North Carolina
charters.36
Given widely acknowledged achievement
gaps, we would expect these differences in student
populations to advantage the charter school sector all
else being equal.
Some other sources of bias in test scores cut against
charter schools however. Students tend to take a
temporary academic hit when they transfer between
schools. Schools, like most organizations, don’t tend
to have the best results from a new school in year one
as routines are established. When you have an entire
sector with many brand new schools full of students
who just transferred in, a snapshot look at test scores
can contain what may ultimately prove to be an optical
illusion of lower scores.37
As a charter sector matures,
however, and new schools come to constitute a smaller
percentage of the total sector, we will have a more
accurate reading of aggregate performance.
North Carolina’s charter sector is still relatively small,
educating only 3.4 percent of students. New schools
full of recently transferred students will continue to
loom large in the sector for some time. NAEP testing
involves taking a random selection of students across
states for each test and grade level, and thus the ability
to look at subgroup performance in the charter sector
will continue to have constraints until the charter
sector grows larger. Some states with large charter
sectors, such as Arizona and Florida, displayed NAEP
scores for charter school students that ranked them
with the highest performing states in 2015 across a
variety of subgroups—including states with substantial
student demographic advantages vis a vis the charter
school students.38
In other words, in Arizona we can
go directly into the NAEP data and compare charter
and district scores across a variety of factors—family
income, parental education, race, special program
status and others. Unfortunately the small size of the
North Carolina charter sector does not yet allow such
comparisons.
With these important caveats in mind, we can say that
what we would like to see in the 2015 NAEP data is
relatively high scores for North Carolina charter school
students. In future years, we hope to see additional
research and better data to inform our understanding
of which factors explain how much of the difference
between district and charter schools, but first you need
to see a difference to explain. At the moment, North
Carolina charter schools have higher NAEP scores
than district schools, but we lack the ability to explore
deeply whether this owes to differences in student
special population status and/or demographics.
Special Program status is one of the few factors that
the 2015 NAEP does allow for subgroup comparisons.
Unlike student subgroups based on parental education,
income or race, a large majority of students in both
district and charter schools are general education
students. Some differences in district and charter
school scores could be accounted for by differences
in the percentages of students with special needs
or those requiring English as a Second Language
services. The 2015 NAEP however does allow for
comparisons between general education students
in North Carolina charter schools. The figure below
presents those scores: North Carolina general
education students attending charter schools
compared to statewide averages for general education
students on the 2015 NAEP mathematics exam.
While currently our ability to make comparisons in the
NAEP data faces limits—making the above comparison
far from definitive—we have reason to feel cautiously
optimistic about North Carolina charter schools. The
states with average scores higher than North Carolina
charter school students, for instance, have significant
student demographic advantages. North Carolina’s
charter school general education students for instance

12
narrowly edged out their peers in Maine. The reader
should note that Maine is far less ethnically diverse
than North Carolina charter school students (91.5
percent of Maine students are White) and the state
spends $12,500 per student in Maine compared to only
$8,300.
Meanwhile, North Carolina charter schools get fewer
public dollars per pupil and demonstrated the same
or higher NAEP scores on the 2015 NAEP exams.
Examining general education students alone, North
Carolina charter schools scored five points higher on
fourth-grade reading, three points higher in eighth-
grade reading, tied in fourth-grade math and scored
seven points higher in eighth-grade mathematics.39
None of these differences can be described as earth
shattering, but given the prevalence of new schools
and new transfers in the North Carolina charter
sector, higher scores despite the possible “optical
illusion” of a growing sector with new schools and
recent transfers provide cause for cautious optimism.
Consider a revenue level of $8,277 per child in charter
schools compared to $9,999 in district schools.40
We
can safely conclude that North Carolina’s charter
schools have managed to get their students into the
same (and perhaps better) academic ballpark as their
district peers at a smaller overall financial cost for
taxpayers. Moreover, through the charter renewal
process, authorities will have the opportunity to shut
down low-performing charters over time. Hopefully
with maturation North Carolina charter schools will
begin knocking the ball out of the park regardless of
the comparisons used.
High-quality charters succeed despite a lower overall
funding level because they have greater flexibility to
pick the curriculum, special programs and facilities that
meet their students’ unique needs. Providing parents
with the freedom to match the focus and strength
of schools with the individual interests and needs of
their child represents the “secret sauce” of parental
choice programs. Charters are a part of a suite of
novel practices searching for ways to show parents
greater autonomy within an updated framework of
public education. Great test scores are not an indication
of these schools being better per se, but rather an
indication that they were a good fit for many of the
students whose parents selected these schools to
educate their child. Operating at a lower overall cost
represents a welcome additional benefit for taxpayers.
Minnesota
New Jersey
New Hampshire
Vermont
Washington
Wisconsin
North Carolina (Charter)
Maine
North Dakota
Indiana
Colorado
Virginia
Iowa
Montana
Nebraska
Wyoming
Utah
Ohio
Connecticut
Kansas
Pennsylvania
Alaska
Texas
Rhode Island
South Dakota
Maryland
Illinois
Oregon
Arizona
Idaho
North Carolina
New York
Hawaii
Delaware
Missouri
California
Tennessee
Georgia
Nevada
Michigan
Kentucky
Oklahoma
Florida
South Carolina
Arkansas
New Mexico
West Virginia
Mississippi
Louisiana
Alabama
Minnesota
0 100 200 300 400 500
NORTH CAROLINA
NORTH CAROLINA (CHARTER)
SOURCE: U.S. DEPARTMENT OF EDUCATION, INSTITUTE OF EDUCATION
ASSESSMENT OF EDUCATIONAL PROGRESS DATA EXPLORER
NAEP 2015 8th Grade Math Scores-
Statewide Averages and North Carolina
Charter School Students

13
BEATING THE HEAT:
Discussions of parental choice can sometimes incite
an unjustified level of excitement. Mindful of this,
let us note here that the North Carolina Constitution
guarantees a public education system and the public
strongly supports it. Thus far, North Carolina has
successfully created alternatives to school districts,
but these alternatives have not and will not replace
school districts. With hundreds of thousands of
additional students and an aging population on the
way, district schools will be full of students and
teachers for as far as the demographer’s eye can
project. Our preoccupation should be “How can we
maximize the number of students attending high-
quality schools?”
EXPANDED PARENTAL
OPTIONS
In recent years, North Carolina lawmakers have
removed a cap on the number of charter schools
and created ways to offer students the opportunity
to attend private school through the Opportunity
Scholarships for low-income students and Children
with Disabilities Scholarship Grants. Choice programs
have the ability to deliver quality schools, higher rates
of parental satisfaction and free up resources for other
critical state activities. These programs represent
crucial steps toward expanding the universe of schools
from which parents can choose in searching for the
best available fit for their child. Parental choice should
be viewed as a fundamental parental right regardless
of a state’s circumstances. Given North Carolina’s
circumstances, it should be understood to have large
practical benefits in addition. Lawmakers can and
should do more to benefit students and taxpayers on
the parental choice front.
Education Savings Accounts (ESAs) represent a
next-generation choice model. Five states—Arizona,
Florida, Mississippi, Nevada and Tennessee—have
adopted ESA programs since 2011. An ESA program
adopts an account-based approach, managed by
parents and overseen by state authorities. Accounts
have limited but multiple uses: private school tuition,
individual public school courses, community college
and university tuition and fees, services from licensed
therapists, online education programs, transportation,
books and curriculum and savings for future higher
education use. The last use creates an incentive
for parents to carefully manage funds and seek the
biggest bang for the education buck.
North Carolina’s school voucher program includes
multiple uses for parents, a unique feature when the
program passed that foreshadowed the advent of
account based programs. The North Carolina voucher
programs do not however allow saving of funds from
one year to the next in an account like fashion.
North Carolina lawmakers however had wisely
recognized the need for multiple options for parents
and had effectively foreshadowed the move into
account type choice programs.41
INCREASING K-12
OPPORTUNITIES INSIDE
OUTSIDE OF THE DISTRICTS

14
A landline phone is an amazing piece of technology
that does one function reliably and well. Someone
from the 19th century would be astounded by a
landline phone and what it can do. An ESA however
more closely resembles a smart phone: while it can
still make calls, it can do multiple things. Just like
the smartphone created the platform to create useful
apps, lawmakers have already devised new uses
for programs for inclusion in the accounts. Nevada
lawmakers first introduced transportation with a
dollar limit into the accounts in 2015, addressing a
major concern of school choice equity in the process.
ESAs move closer to a system of full parental control
over education and create proper incentives for
service providers to deliver the best possible products
at the lowest possible price.
Facing a huge overcrowding problem, with district
schools unable to either build enough space or hire
enough public school teachers, Nevada lawmakers
created the nation’s most robust choice program in
2015. Nevada’s ESA program passed as part of a
comprehensive set of policies aimed at improving
education outcomes. The law makes all public school
students eligible to transfer into the ESA program, and
addresses equity concerns by providing higher levels
of subsidy for low-income students and students with
disabilities. Striking an appealing balance between
the need for academic transparency to the public and
the independence and diversity of private education
providers, the bill requires ESA students to take a
nationally normed reference test (e.g. the Stanford 10
or Iowa Test of Basic Skills).
Nevada’s program was scheduled to launch in January
2016, and before that the state was taking early
applications. As has been the case for every private
choice program, no mad exit from the public school
system has ensued. The state received 4,100 pre-
applications for participation in the ESA program—
less than one percent of the total public school
population.42
Private choice programs have always
started small and grown incrementally over time
with increasing public awareness and incremental
increases in private school supply.
North Carolina policymakers should carefully study
Nevada’s law and the implementation process carried
out by Nevada State Treasurer Dan Swartz that
included the state contracting with a private firm
experienced in the management of health savings
accounts.
A broadly available ESA program
could slow the rate of district
enrollment growth, and increasing
and saving the state money could
benefit North Carolina students and
taxpayers. Nevada has set a high
bar, but North Carolina could create
an even more powerful mechanism
for parental control of education.
INCENTIVE FUNDING
Another example of additional spending with a
potentially high return on investment involves the
provision by the state of school bonuses for the
earning of college credit by exam and/or high-demand
professional certifications. The policy provides a
significantly greater bonus for low-rated schools that
help students earn college credit by exam and created
a partnership with a non-profit to identify and recruit
students from student groups under-represented
in Florida universities to seek credit-earning
opportunities.
As a result of these policies and practices, Florida saw
a substantial increase in students passing Advanced
Placement exams. In 2014, Florida ranked third
overall on the percentage of graduates passing an
Advanced Placement exam.43
The College Board found
that the state ranked second on the overall increase
in Advanced Placement passing rates between 2003
and 2013.44
African-American and Hispanic students
not only participated in this increase, they helped to
lead the charge. Since the advent of the program, the
number of African-American and Hispanic students
passing Advanced Placement exams has more than
quadrupled.45
Students taking Advanced Placement
exams have shown a greater level of persistence in
college, including students who failed to pass the
exams. While Florida adopted both an Advanced
Placement and industry certification incentive, other
states have also seen how these types of incentives can
work for students.

15
Lawmakers want to support the long-term success
of students by providing them with real-world
skills that employers value. In Kansas, legislators
created a similar bonus program to reward school
districts for students who earn industry-recognized
certifications in high-demand fields. The incentive
was passed in 2012 and took effect in 2012-2013.
Prior to the incentive, 548 students earned industry
credentials. Three years later,
Kansas saw an increase of over
205 percent, with 1,670 students
earning industry credentials in
2014-2015.46
In this way, Kansas
lawmakers have invested in the
career success of students.
In facing a future with more elderly and young
residents, North Carolina lawmakers need to
take strong action to equip every student with the
opportunity to enjoy success in college, a career, or
in both. We should regard each and every student
that fails to graduate or graduates without the skills
to succeed in either college or the workplace as a
tragic waste of human potential. The state cannot
afford to make this mistake now, and the cost will rise
dramatically in the future.

16
CONCLUSION:
INNOVATION NEEDED
FOR CONTINUED
SUCCESS
Past success in policy innovation should inform future action because the path will become increasingly
rocky. In the worst-case scenario, North Carolina would experience slowing economic growth, and young
and old people would set about fiercely battling over limited resources for health care and education
funding. This scenario can be avoided, but improved K-12 outcomes must play a role in securing the
prosperity needed to successfully navigate the future.
Specifically, North Carolina needs both improved outcomes and cost efficiencies in K-12 to cope with K-12
enrollment growth and the pressure for increased health care spending. K-12 reform alone cannot hope to
address this crisis, but it is also the case that we cannot hope to address the challenge without substantial
K-12 improvement.
North Carolina students should not be graduating from high school without being prepared for success
in college or else equipped with marketable job skills. Policymakers should craft high-impact policies to
create financial incentives for students to achieve one or both of these merits.
Enrollment growth projections make a powerful case for strengthened parental choice policies.
Thousands of North Carolina parents sit unhappily on waitlists for charter schools in search of a school
that fits their child’s needs.47
Policymakers should pursue policies to help high-quality school operators
expand the number of seats they can offer to parents. In addition, the state should put private education
within the reach of a larger number of North Carolina parents. The vast majority of North Carolina
students will continue to attend district schools regardless of what options policymakers create.
Challenges loom large, but our opportunities are larger still. North Carolina’s only palatable path out
of the challenge of age demographic change involves innovation. The state has a successful track
record to build on. It’s time to get North Carolina scores moving again. Some will emotionally cling to an
unsustainable status quo, but the need for improved outcomes in education and health care spending will
become increasingly impossible to ignore or deny.
It’s time to go all in to secure a better state than the one North Carolinians inherited. North Carolinians
today can and should work to improve the status quo for the generation coming next.

17
1. See Colby, Sandra and Jennifer Ortman. 2014. “The Baby Boom Cohort in the United States: 2012 to 2060.” Report of the United States Census Bureau,
available on the internet at https://www.census.gov/prod/2014pubs/p25-1141.pdf.
2. For a discussion of the looming aging crisis, see Jeff Wheelwright.2012. “The Gray Tsunami: The world faces a wave of aging, and with it wrenching
social and economic changes. An Arizona retirement community hints at things to come.” Discover (Oct. 2014) http://discovermagazine.com/2012/oct/20-
the-gray-tsunami.
3. Paul Taylor and Pew Research Center, The Next America: Boomers, Millennials and the Looming Generational Showdown (New York, NY: PublicAffairs,
2014), p. 17.
4. United States Census Bureau. 2005. “Interim Projections of the Population by Selected Age Groups for the United States and States: April 1, 2000
to July 1, 2030.” Publication of the United States Census Bureau, available on the internet at https://www.census.gov/population/projections/data/state/
projectionsagesex.html.
5. National Association of State Budget Officers. “State Expenditure Report.” Publication of the National Association of State Budget Officers, available on
the internet at http://www.nasbo.org/sites/default/files/State%20Expenditure%20Report%20%28Fiscal%202013-2015%29S.pdf, page 8.
6. See Brownstein, Ronald. 2015. “‘Brown and Gray’ Dynamics New Census data reveal divergent age profiles for a youthful population of color and an
aging white population.” Article in the National Journal, available on the internet at http://www.nationaljournal.com/next-america/early-childhood/brown-
gray-dynamics.
7. United States Census Bureau. 2005. “Table 5. Population under age 18 and 65 and older: 2000, 2010, and 2030.” Available on the Internet at https://
www.census.gov/population/projections/data/state/projectionsagesex.html.
8. Ibid.
9. See Ladner, Matthew. 2014. “Turn and Face the Strain: Age Demographic Change and the Near Future of American Education.” Publication of the
Foundation for Excellence in Education and the Friedman Foundation for Educational Choice, available on the internet at http://static.excelined.org/wp-
content/uploads/ExcelinEd-FaceTheStrain-Ladner-Jan2015-FullReport-FINAL2.pdf, page 25.
10. Ibid.
11. Ibid.
12. North Carolina Office of State Budget and Management. 2015. Projected County Totals – Standard Age Groups. Available on the internet at http://www.
osbm.nc.gov/demog/countytotals_standardagegroups.
13. United States Census Bureau. 2015. “Annual Estimates of the Resident Population by Sex, Age, Race, and Hispanic Origin for the United States and
States: April 1, 2010 to July 1, 2014.” Publication of the U.S. Census Bureau, Population Division, available on the internet at http://factfinder.census.gov/
faces/tableservices/jsf/pages/productview.xhtml?src=bkmk.
14. North Carolina Office of State Budget and Management. 2015. Projected County Totals – Standard Age Groups. Available on the internet at http://www.
osbm.nc.gov/demog/countytotals_standardagegroups.
15. United States Department of Education, National Center for Education Statistics. 2015. Digest of Education Statistics Table 203.20. Enrollment in
public elementary and secondary schools, by region, state, and jurisdiction: Selected years fall 1990 through fall 2024.” Publication of the National Center for
Education Statistics, available on the internet at https://nces.ed.gov/programs/digest/d14/tables/dt14_203.20.asp.
16. Hui, T. Keung. 2015. “Wake County school system seeing fewer new students than expected.” Article appearing in the December 8, 2015 edition of the
News and Observer, available on the internet at http://www.newsobserver.com/news/local/education/article48670670.html.
17. Forster, Greg. 2013. “Win-Win Solution: The Empirical Evidence on School Choice.” Publication of the Friedman Foundation for Educational Choice,
available on the internet at http://www.edchoice.org/wp-content/uploads/2015/07/2013-4-A-Win-Win-Solution-WEB.pdf#page=1, pages 10-13.
the internet at http://www.nasbo.org/sites/default/files/State%20Expenditure%20Report%20%28Fiscal%202013-2015%29S.pdf, page 8.
19. De Rugby, Veronique. 2013. “The U.S. Debt in Perspective.” Publication of the Mercatus Center, available on the internet at http://mercatus.org/
publication/us-debt-perspective.
20. Pew Research Center. 2010. “Baby Boomers Retire.” Available on the internet at http://www.pewresearch.org/daily-number/baby-boomers-retire/.
SOURCES

18
the internet at http://www.nasbo.org/sites/default/files/State%20Expenditure%20Report%20%28Fiscal%202013-2015%29S.pdf.
22. Kaiser Family Foundation. 2012. “5 Key Questions about Medicaid and its role in State/Federal Budgets and Health Reform.” Available on the internet
at https://kaiserfamilyfoundation.files.wordpress.com/2013/01/8139-02.pdf.
23. Rowland, Diane and Barbara Lyons. 1996. “Medicare, Medicaid, and the Elderly Poor.” Article in Health Care Financing Review, Winter 1996 Volume 18,
number 2. Available on the internet at http://www.ssa.gov/history/pdf/RowlandandLyons.pdf, pages 65-66.
24. Moody’s Investor Service. 2015. “Moody’s: Aging population driving increases in state Medicaid long-term care spending.” Publication of Moody’s
Investor Service, available on the internet at https://www.moodys.com/research/Moodys-Aging-population-driving-increases-in-state-Medicaid-long-term--
PR_325875.
25. Kaiser Family Foundation. “Medicaid Spending by Enrollment Group.” Publication of the Kaiser Family Foundation, available on the internet at http://
kff.org/medicaid/state-indicator/medicaid-spending-by-enrollment-group/#.
26. United States Census Bureau. 2011. “The Older Population: 2010.” Publication of the United States Census Bureau, available on the internet at https://
www.census.gov/prod/cen2010/briefs/c2010br-09.pdf.
27. Ibid, Wiles.
28. Ibid NASBO, page 19.
29. Ibid NASBO, page 3.
30. Poterba, James M. 1996. “Demographic Structure and the Political Economy of Public Education.” National Bureau of Economic Research Working
Paper number 5677, available on the internet at http://www.nber.org/papers/w5677.
31. Peterson, Paul E., Ludger Woessmann, Eric A. Hanushek and Carlos Xabel Lastra-Anadón. 2011. “Are U.S. Students Ready to Compete?” Publication in
the Fall 2011 edition of Education Next, available on the internet at http://educationnext.org/are-u-s-students-ready-to-compete/.
32. North Carolina 8th graders took the 8th grade reading exam for the first time in 1998.
33. North Carolina Department of Public Instruction. “Cohort Graduation Rates.” Available on the internet at http://www.dpi.state.nc.us/accountability/
reporting/cohortgradrate.
34. Tippet, Rebeca. 2015. “NC in Focus: Increasing Educational Attainment.” University of North Carolina Carolina Demography Blog, available on the
internet at http://demography.cpc.unc.edu/2015/12/10/nc-in-focus-increasing-educational-attainment/.
35. Cheng, Albert, et al. 2015. “No Excuses Charter Schools: A Meta-Analysis of the Experimental Evidence on Student Achievement.” EDRE Working
Paper No. 2014-11, available on the internet at http://www.uaedreform.org/downloads/2014/12/no-excuses-charter-schools-a-meta-analysis-of-the-
experimental-evidence-on-student-achievement.pdf.
36. See National Alliance of Public Charter schools Public Charter School Dashboard at http://dashboard.publiccharters.org/dashboard/students/page/
overview/state/NC/year/2013. For the 2012-13 school year North Carolina district schools enrolled 51.8 percent White students, 26.1%, 14.3% Hispanic
students. North Carolina charters enrolled 60.7 percent White students, 26.4% Black students and 6.4% Hispanic students.
37. Peterson, Paul E. 2010. “Charter Schools and Student Performance.” Column appearing in the March 16, 2010 edition of the Wall Street Journal,
available on the internet at http://www.wsj.com/articles/SB10001424052748703909804575123470465841424.
38. See Ladner, Matthew. 2015. “Slice and Dice the Data but Arizona Charters Continue to CeleNaep Good Times.” Publication on the Jay P. Greene Blog,
available on the internet at http://jaypgreene.com/2015/11/16/slice-and-dice-the-data-but-arizona-charters-continue-to-celenaep-good-times/. See also
Ladner, Matthew. 2015. “Florida Charter Schools: We’re going to CeleNAEP and Have a Good Time!” Publication on the Ed Fly Blog, available on the internet
at http://www.excelined.org/2015/11/20/florida-charter-schools-were-going-to-celenaep-and-have-a-good-time/. See also Ladner, Matthew. 2015. “AZ
Charter Scores are Real, and They’re Spectacular.” Publication on the Jay P. Greene Blog, available on the internet at http://jaypgreene.com/2015/12/08/az-
charter-scores-are-real-and-theyre-spectacular/.
39. National Center for Education Statistics. 2015. National Assessment of Educational Progress. Available on the internet at https://nces.ed.gov/
nationsreportcard/.
40. Batdorff, Meagan, et al. 2014. “Charter School Funding: Inequity Expands.” Publication of the University of Arkansas Department of Education Reform,
available on the internet at http://www.uaedreform.org/wp-content/uploads/2014/charter-funding-inequity-expands-nc.pdf, page 2.

19
41. For details on the uses for North Carolina’s voucher program for special needs students, see http://www.ncga.state.nc.us/EnactedLegislation/
Statutes/HTML/BySection/Chapter_115C/GS_115C-112.6.html.
42. Office of the Nevada State Treasurer. 2015. “Treasurer’s Office Says Last Minute Enrollment “Glitch” Fixed-Extends Deadline Until 5:00 P.M.
Wednesday.” Press Release by the Nevada State Treasurer Office, available on the internet at http://www.nevadatreasurer.gov/PublicInfo/PR/2015_
News_Releases/.
43. Postal, Leslie. 2015. “Florida Ranked Third for AP Success.” Article in the April 8, 2015 edition of the Orlando Sentinel, available on the internet at
http://www.orlandosentinel.com/features/education/school-zone/os-florida-class-of-2014-ap-scores-post.html.
44. College Board. 2014. “The 10th Annual AP Report to the Nation.” Publication of the College Board, available on the internet at http://media.
collegeboard.com/digitalServices/pdf/ap/rtn/10th-annual/10th-annual-ap-report-to-the-nation-single-page.pdf, pages 12-13.
45. Foundation for Excellence in Education. 2013. Florida’s Education Revolution. Publication of the Foundation for Excellence in education, available
on the internet at http://excelined.org/wp-content/uploads/Floridas-Education-Revolution-Summary-2013.pdf, page 7.
46. Kansas State Department of Education. 2015. 2015 Credential Incentive Report. Publication of the Kansas Department of Education, available on
the Internet at http://www.ksde.org/Portals/0/CSAS/CSAS%20Home/CTE%20Home/Initiatives/2015%20Credential%20Incentive%20Report.pdf.
47. Parents for Educational Freedom in North Carolina. 2015. “Public Charter Schools.” Publication of Parents for Educational Freedom in North
Carolina, available on the internet at http://pefnc.org/resources-research/public-charter-schools/.

ExcelinEd.org
About the Author
Dr. Matthew Ladner is the Senior Advisor of Policy and
Research for the Foundation for Excellence in Education.
Ladner has written numerous studies on school choice, charter
schools and special education reform and coauthored Report
Card on American Education: Ranking State K-12 Performance,
Progress and Reform for the American Legislative Exchange
Council. Ladner has testified before Congress, the United States
Commission of Civil Rights and numerous state legislative
committees. Ladner is a graduate of the University of Texas
at Austin and received a Ph.D. in Political Science from the
University of Houston. Ladner is a Senior Fellow with the
Foundation for Educational Choice. He lives in Phoenix with his
wife Anne and children Benjamin, Jacob and Abigail.

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