Overview

During the last two decades, when compared with the rest of the nation, North Carolina has made tremendous strides in improving public education from grades PK through high school. Recognizing that public education is inextricably linked to the economic health of the state, the state's governors and the legislature, in concert with elected and appointed educational leaders, enacted a plethora of initiatives to elevate the quality of public education. On most of the national indicators of school quality, the state no longer languishes near the bottom. Due to the development and implementation of a rigorous state-wide district and school level accountability program, North Carolina now is recognized as one of the states that has led the nation in effecting state-wide school improvements. As a result, the North Carolina school accountability program was often cited, along with several others, as a model to borrow from as the "Federal No Child Left Behind" law, enacted in 2002, was being developed.

Nevertheless, like most other states, North Carolina still faces some profound challenges in the ongoing quest to improve the quality of education offered to students. Given the diverse character of the state in terms of population demographics, local property values, poverty, economic growth, technological advances, and shifting labor force needs, the vast majority of the state's schools are challenged to adequately and effectively educate all students. Although some students are achieving far above their grade levels, others are behind and struggling. A disproportionate number of the latter students are poor and members of minority groups, particularly black, American Indian, and Hispanic. This results in a troubling achievement gap between white and minority students. State and local policy makers and school leaders also face ongoing challenges in providing adequate financial resources for schools and in employing and retaining highly qualified teachers and school administrators.

	Education Demographics School Personnel Public School Expenditures Indicators of Student Progress Current Issues and Challenges Summary Watch Video on North Carolina Public Education
Pam Addington's kindergarten class at Carr Elementary School
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Education Demographics

Table 1 shows some of the important facts and figures regarding the North Carolina Public schools during the 2002-2003 school year. At that time, the largest school district was Charlotte-Mecklenburg's, with 109,594 students, and the smallest was Hyde County, with 681 students (Figure 1). Although North Carolina has four of the largest 100 school districts in the nation, the average school district in the state enrolled only 6,576 students.

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North Carolina joined the national movement to establish charter schools when the General Assembly passed legislation in 1996 to allow their creation. Charter schools are alternative public schools operated by a group of parents, teachers, or community groups. These schools are allowed to operate under a charter approved by the North Carolina State Board of Education to operate in a semi-autonomous fashion and to be exempted from some of the rules and regulations under which regular public schools normally operate. The primary purpose of charter schools is to give parents the option of enrolling their children in a school with a special focus and in which they have a greater role in determining how it operates. Funding in the amount of the average per pupil expenditure allocated to the public school system that charter school students would normally attend is transferred to the charter schools. The enabling legislation under which charters were created stipulated that a maximum of 100 charter schools could be approved to operate at a given time. As of the 2003-2004 school year, 93 charter schools were in operation, supported by $94,286,726. At that time, 124 charter schools had been approved, 113 had opened, 20 had closed, and 10 had relinquished their charter without ever opening.

Table 2 shows the number of public school students enrolled in grades kindergarten through grade 12 at the end of the first school month and the number enrolled at the end of the first semester of the 2002-2003 school year, including ethnic percentages represented.

Table 3 below shows the number of students who were involved in non-public schooling in North Carolina during the 2001-2002 and 2002-2003 school years. At the end of this time, slightly less than 93,000 were enrolled in non-public private or religious schools and nearly 52,000 students were being home schooled. For both of these years, slightly less than 10% of the students in the state were participating in a schooling alternative other than the public schools. It should be noted that charter schools are considered public schools; therefore, students attending them are not included in the numbers shown here.

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School Personnel

To operate its public schools during the 2003-2004 school year, North Carolina employed a certified staff of 105,884 and a non-certified staff of 63,225, which totaled a workforce of 169,109 people (Table 4). Nearly 76% of the staff was paid from state funding, almost 16% were paid from local (county) funding, and slightly more than 8% were paid from federal funds to staff categorical programs.

Table 5 shows the highest professional degrees held by personnel employed in the public schools of North Carolina during the 2002-2003 school year. For nearly 64%, the baccalaureate is the highest degree held, while nearly 34% hold the masters degree.

Public School Expenditures

In North Carolina, the state pays the greatest proportion of the cost to educate students in the public schools. As a consequence, the largest portion of the state's annual budget is allocated to public school students in grade K-12. Nevertheless, while the amount of state funding for public education has continually increased from 1983-1984 through 2003-2004, the public schools have been receiving a decreasing percentage of the state's General Fund appropriations, declining by 11.6% from 1970 through 2003. As of the 2002-2003 school year, North Carolina ranked 5 th in the nation and 1st in the South in terms of the percentage of funds from state revenues. From this, one might conclude that state policy makers have demonstrated a substantial commitment to support K-12 education on a state-wide basis. Figure 2 shows the major state expenditures by function for the fiscal year ending June, 2001.

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The total expenses to operate the public schools in North Carolina are grouped into two major categories-- current expense expenditures and capital expense expenditures. Current Expense are those expenditures that are spent for daily operations in the public school of the state. Since these amounts are based on and driven by the number of students enrolled in the schools each year, these numbers tend to be fairly stable, rising (or declining) commensurately with student enrollment. The aggregate amount for current expenses comes from state, federal, and local sources. However, the largest proportion (approximately 67%) comes from the state (Figure 3). In contrast, capital expense expenditures are used to construct new buildings or reconstruct and repair existing buildings and to acquire equipment with a lifetime expectancy of greater than one year. Thus, in comparison with current expense expenditures, capital expense expenditures fluctuate considerably from year to year. Funding for capital expense expenditures comes primarily from the local level by allocations from the board of county commissioners in each of North Carolinas 100 counties. Exceptions occur periodically when the state issues bonds to obtain the revenue needed to construct or renovate school facilities. This began with a School Facilities Appropriation in 1949, and has been supplemented by school bonds in passed in 1949, 1953, 1963, 1973, and 1996.

Figure 4 shows the percentage of funds from the three major sources for current expenses in 2002-2003.

The state portion for current expense expenditures rose from $5.9 billion for 2002-2003, to $6.1 billion in 2003-2004 .

Figure 5 shows public school expenditures in 2002-2003. By far, the largest amount of public school funding (91.2%) supported salaries and benefits for school employees, while the remaining sources combined made up less than 9%. Since portions of the funding for transportation and staff development may also be used for salaries and benefits, it is evident that the vast majority of school funding is expended in salaries and benefits. Given these constraints, school leaders have limited resources to expend for purposes other than personnel.

Table 6 shows the expenditures for capital outlay, spent primarily for school construction and renovations for the period from 1999 to 2002-2003. These data show that the principal source (over 73%) for capital outlay was from the local (county) level; slightly more than a fourth (26%) came from state funds, and the federal government provided less than one-half of one percent.