The New Jersey Department of Education (NJDOE) is removing thousands of special education students from its calculation of the state’s high school graduation rate for the federal government. While these students can continue to earn state-endorsed diplomas if they satisfy the requirements in their Individual Education Plans (IEP), many will no longer be included in New Jersey’s official federal graduation rate.

The change, which will affect thousands of students and hundreds of New Jersey high schools, is the result of two factors:

  • New Jersey is one of the few states that requires a separate “exit test” to earn a high school diploma; and
  • The U.S. Education Department (USED) will no longer allow special education students who receive an IEP waiver from the testing requirement to be included in the federal graduation rate.

The USED ordered the change as part of a 2019 Federal Performance Review of the NJDOE. As a result, beginning with the class of 2021, the NJDOE has begun calculating two graduation rates: a state version that includes all graduates, and a federal version that excludes students who receive modifications or exemptions in their IEPs.

The federal rate is used for accountability purposes and is one of the metrics used to identify high schools for intervention by the state under the Every Student Succeeds Act (ESSA). In an April presentation on the new graduation rate formula to the State Board of Education, the Department said it anticipates an “increase in the number of schools identified in this category next year.” Schools and districts that serve large numbers of special needs students will be most affected.

The change was first applied to the graduation rate for the class of 2021, released in April. The graduation testing requirement was suspended due to the Covid-19 pandemic for students in the class of 2021. But 2200 special education students were still excluded from the federal graduation rate because of their IEP exemptions for other things, including attendance or credit requirements. As a result, the “state graduation rate” was 90.6%, while the “federal rate” was only 88.5%.

The effect on the graduation rate for the subgroup of special education students was even more striking. The 2021 state rate for students with disabilities was 79%; the federal rate, with exempt students excluded, was 67%. Under the new formula, 63% of New Jersey high schools have a lower federal rate than their state rate. For about 5% of those schools the difference in the two rates is more than 10%.

The impact of this change will grow over the next year because New Jersey’s graduation testing requirement is being enforced for the class of 2022. Therefore, students with IEP testing exemptions will be excluded for the first time when the 2022 federal rate is calculated and released next spring.

Typically, there are about 5-7,000 New Jersey students who receive IEP exemptions each year, many related to the graduation testing requirement. That means the state’s federal graduation rate, which for years has been near the top in the nation, will likely drop below 90% into a lower tier.

Another effect will be increased pressure on special education students to take and pass the New Jersey Graduation Proficiency Assessment (NJGPA), and, if they do not pass, to take one of the designated alternative tests or use the portfolio assessment to meet the testing requirement. Only special education students who successfully complete a graduation assessment can be included in a school’s official graduation rate. To avoid being classified for intervention under ESSA, schools will be under pressure to get more special education students over the diploma testing hurdle.

These new rules make it especially important that special education students and families make sure that the requirements for high school graduation are clearly written into a student’s IEP. This should be done as soon as a student enters ninth grade.

There is also another, more direct solution.

“New Jersey’s 40-year-old law requiring exit testing should be repealed,” said Stan Karp, Director of Education Law Center’s Secondary Reform Project. “There is no federal mandate that requires extra testing for diplomas and no good reason to exclude from the state’s graduation rate thousands of students who properly earn regular diplomas. It’s an example of bad policy producing negative results.”

“New Jersey already has far more standardized testing than required to meet federal accountability requirements,” Mr. Karp added. “The state should remove this extra, unnecessary layer of high stakes graduation testing which the State Board of Education and the NJDOE have been making a mess of for far too long.”


Press Contact:

Sharon Krengel
Policy and Outreach Director
973-624-1815, x 240


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Press Contact:
Sharon Krengel
Director of Policy, Strategic Partnerships and Communications
973-624-1815, x240