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Audit Reveals Inaccuracies and Lack of Oversight in California’s Graduation Rates

A new federal audit found significant problems with the way the state of California lets school districts calculate graduation rates.

Superintendent Cindy Marten delivers her State of the School District address. / Photo by Jamie Scott Lytle

California’s high school graduation rate rose steadily between 2011 and 2016, but a new report from the U.S. Department of Education’s Office of Inspector General says those numbers aren’t reliable.

The California Department of Education lacks sufficient controls to ensure graduation rates are accurate and complete, according to the report.

It also said the state does not calculate graduation rates in accordance with federal requirements.

Much of the report focuses on the way in which the state’s education department calculates “adjusted cohort graduation rates,” or ACGRs, a uniform way of measuring groups of students who enter high school at the same time and graduate within four years.

“We found that CDE’s system of internal control did not provide reasonable assurance that reported graduation rates were accurate and complete during our audit period. In addition, CDE did not calculate its ACGR in accordance with Federal requirements,” reads the report.

The findings raise questions about the accuracy of statewide graduation rates. Had CDE properly calculated graduation rates in 2013-2014, for example, the graduation rate would have dropped from 81 to 79 percent.

The audit’s findings also reflect similar issues Voice of San Diego has detailed with the San Diego Unified School District’s graduation rate for the class of 2016.

That year, the district reached a graduation rate of 91 percent – an all-time high.

But 35 percent of San Diego Unified’s class of 2016 transferred out of district-run high schools before they completed their senior years – a higher rate of departure than any other large, urban school district in the state.

A large number of those students – namely, those least likely to graduate due to low GPAs – left San Diego Unified en route to charter schools, sometimes at the urging of school staff. Students who leave district schools for charter schools are excluded from the district’s overall graduation rate.

The charter schools to which most students transferred are considered alternative schools, where students can graduate with diplomas that require them to earn fewer credits.

Along the way, San Diego Unified officials have maintained they followed “strictly administered guidelines set by the California Department of Education.” That’s true.

However, some of those guidelines may contradict federal guidelines.

The audit did not specifically mention students who were removed from a district’s graduating class because they transferred to alternative charter schools. However, the audit found that the state does not strictly monitor the graduation rates that districts report.

The Office of Inspector General recommended the state review its graduation rates from previous years and correct them – or at least note the graduation rates were not accurate.

Those recommendations are addressed to the U.S. Department of Education, which would decide whether to take any action if California ignored the auditors’ recommendations, said Catherine Grant, public affairs liaison for the U.S. Department of Education Office of Inspector General.

Auditors found problems at all three entities they reviewed, including Los Angeles Unified, Los Angeles County Office of Education and the state’s largest directly-funded charter school, Baldwin Park. Each is considered a distinct type of local education agency, or LEA, and is responsible for reporting its graduation numbers to the state.

The gist of the audit indicates the California Department of Education does not do enough to oversee the process school districts use to calculate and report graduation rates to the state, or to ensure the data’s accuracy. And because it doesn’t adequately monitor the accuracy of data school districts report, CDE has overlooked errors in the data.

“Specifically, CDE did not detect that Los Angeles Unified, Los Angeles County, and Baldwin Park erroneously reported students as graduates who did not complete graduation requirements, and Los Angeles Unified included students as graduates who did not complete graduation requirements before the cohort cutoff date,” the report states.

Elsewhere, auditors found CDE didn’t calculate graduation rates in accordance with federal requirements. For example, in 2013-2014 the state improperly removed from its graduation cohort 10,543 students who transferred to adult education programs or community colleges, as well as those who didn’t complete graduation requirements. If corrected, the 2014 graduation rate would drop by two percentage points.

In response, CDE agreed with some, but not all, of the audit’s findings and recommendations.

The department acknowledged that it does not monitor the processes school districts use to report graduation rates, but said this is less of an oversight or deficiency as it is a feature of local control. In other words, local school boards are responsible for making sure its students meet graduation requirements and superintendents are responsible for making sure data is accurate, CDE said.

All three entities auditors reviewed – Los Angeles Unified, Los Angeles County Office of Education and Baldwin Park – are the largest entities of their kind in the state. While auditors didn’t mention any other school districts, they may have also reported inaccurate data, including San Diego Unified.

Ron Rode, the San Diego Unified’s director of research and evaluation, said the district will monitor the situation and update its procedures should the state change its guidance to school districts. Rode emailed the following statement:

“The report appears to highlight a dispute between the state and federal agencies and does not mention San Diego Unified. Should the state alter its guidance to LEAs, we will obviously update our own procedures to ensure compliance. In the meantime, we continue to have a high degree of confidence in local graduation rates, as each graduation certificate is personally approved by two individuals, including principals who would be subject to professional misconduct charges were they to allow unqualified students to graduate.”

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