How Much Does North Carolina Spend to Produce one High School Diploma?

How Much Does North Carolina Spend to Produce one High School Diploma?
K-12 public education remains one of the most talked about policy issues in North Carolina. Public interest derives not only from the importance of the task, but also the level of public spending.   In the 2010-11 state budget, 37 percent of state spending approximately $7.1 billion is devoted to K-12 public education. In 2008-09, state, federal and local expenditures for K-12 public education totaled $12.2 billion on a student population of 1.4 million. The economic challenges facing North Carolinians underscore the importance of understanding how much North Carolina is spending for education and how well our institutions are performing.  One question that flows from this discussion is:   How much does it cost to produce a high school graduate in North Carolina?¹

Methodology
To answer this question, annual per student average expenditures were gathered for 13 years (1996-97 to 2008-09) grades K-12) for the 10 largest local education agencies (LEAs) in North Carolina.²  In 2008-09, the ten largest LEAs accounted for approximately 40 percent of all K-12 students enrolled in North Carolina public schools. Annual per student expenditure figure sum  state, local and federal per pupil expenditures  The figures are then adjusted for inflation. Annual totals are then divided by the LEAs 2008 graduation rate. Since the costs of a diploma should accurately reflect all educational costs, the costs of those who fail to graduate are included.   According to Department of Public Instruction data, 70 percent of 9th grade students who enrolled as freshmen in 2005-06, graduated four years later in 2008-09. 

Data for this study is from the Education Statistics Access System (ESAS), available on the North Carolina Department of Public Instruction web site. 

Results
Table I lists the inflation-adjusted dollar cost of a High School Diploma in the 10 largest LEAs in North Carolina.  The cost of a diploma ranges from a low of $110,262 (Union County) to $197,648 (Durham County).  The median spending level for the ten largest LEAs was $122,478.  

Table I High School Diploma: How Much Does it Cost? Ten Largest LEAs in North Carolina
LEA	(A) Total  of Ave. Annual Expenditures Per Pupil, K-12 (1996-97-2008-09) (Inflation Adjusted Dollars)	(B) 4 Yr. Graduation Rate  2008-093	(C) Cost of High School Diploma (A/B)4 (Inflation-Adjusted Dollars)
Cabarrus	$85,092	72.9	$116,724
Char.-Mecklenburg	$101,586	66.6	$152,531
Cumberland	$89,740	71.3	$125,862
Durham	$124,321	62.9	$197,648
Forsyth	$102,379	70.8	$144,603
Gaston	$86,970	72.3	$120,290
Guilford	$101,585	79.5	$127,779
Johnston	$90,629	75.1	$120,667
Union	$85,123	77.2	$110,262
Wake	$96,277	78.8	$122,178
Median of of Ten Largest LEAs	$93,453	72.6	$122,478

Is $122,478 too much spend on a high school diploma?  Thats the inflation-adjusted median value of the cost per-diploma for the 10 largest LEAs in North Carolina.  Determining whether that cost is too high is a question North Carolinians should ask themselves. When doing so, we should remember, that figure is a conservative estimate. On average, per student cost figures reflect normal operating expenses only. These figures do not include the costs of  capital expenses, debt services, equipment purchases, transportation costs or the cost of community service programs. Adding in these costs can typically raise per pupil spending by nearly 25 percent.⁵ 

Determining an acceptable level of education spending also involves an understanding of the return for that spending. How do students perform on state tests?  What is the graduation rate?   These are some of the questions that can help produce answers and ensure our schools are educating our young people in the most cost-effective manner.

Click here to view the PDF of the 10 largest LEAs in North Carolina.

---