September 4 Policy Updates

This week, North Carolina celebrated its highest graduation rate in history, along with achievement gains across nearly all grades and subjects. While the results offer important signs of progress, they also come as state leaders consider how to modernize North Carolina’s complex school funding system. The Blue Ribbon Commission on Public Education met this week to discuss potential changes to school finance–a process that could reshape how resources are distributed across the state.

School Accountability

Wednesday’s State Board of Education meeting included the release of the 2025-26 accountability results. Several notable trends emerged from the annual testing report:

• North Carolina’s four-year graduation rate reached a historic high of 88.8%
• 59.2% of students were proficient on state EOG/EOC assessments–the highest overall proficiency rate in the past three years.
• 14 of 15 reading and math assessments had their highest proficiency rates of the past three years, and results for every racial/ethnic subgroup also reached three-year highs.
• The percentage of English Language Learners who showed progress or exited the program reached its highest point in three years.
• The percentage of schools receiving a D or F dropped from 31% to 23%, with 162 fewer schools designated as low-performing.

While there is much to celebrate, DPI noted that achievement and access remain inconsistent across schools, regions, and student groups. Continued growth in grade-level proficiency and reductions in achievement gaps remain important priorities. DPI also highlighted the need to increase the number of students earning College and Career Ready scores (Levels 4 and 5 on EOG/EOC assessments). While 59.2% of students are grade-level proficient, only 37.5% are considered “on track for the future,” highlighting the difference between meeting grade-level expectations and being prepared for what comes next.

School Funding

The Blue Ribbon Commission heard presentations on school finance this week and discussed several factors that could shape future funding decisions. Redesigning how schools are funded appears to be a growing state priority, with the General Assembly establishing a Weighted Student Funding Work Group in the recently passed budget. 

The Public School Forum recently released a report exploring how North Carolina could modernize its school funding system through a weighted student funding (WSF) approach. In simple terms, WSF directs additional funding toward students who may require greater resources and support. The report examines several potential models and identifies key considerations for any transition.

Does More Funding Improve Outcomes?

The relationship between school funding and student achievement is more complicated than simply asking whether “more money” produces better test scores. Research consistently shows that greater investment in public education leads to stronger academic and life outcomes, but how those resources are invested also matters.

One compelling example is Title I, a federal program that provides additional funding to schools and districts serving students experiencing poverty. Research on the long-term effects of Title I found that increases in funding were associated with higher educational attainment and high school graduation rates, as well as higher adult earnings. The effects were particularly strong for students from low-income families.

This research illustrates why the question is not simply whether schools receive more money, but whether funding is adequate, equitable, and directed toward the students and resources that need it most. This is an important consideration as North Carolina evaluates potential changes to its funding formula. A weighted student funding model could make it easier to direct resources toward students with greater needs and give districts more flexibility in how those resources are used. But no funding formula can substitute for adequate overall investment. As the state considers how to distribute education dollars more effectively, the larger question is whether there are enough dollars to distribute in the first place.