While there is still no official national formula for calculating graduation rates, the work of the National Governors Association (NGA) will have 39 states using the same formula by 2010, and the U.S. Department of Education (through NCES) has been mounting an effort to create one as well. (NCES formed a task force to consider the issue, which in February 2005 concluded that states and federal statisticians should work together to devise data-collection systems that can track individual students through their high school years.)

According to "Diplomas Count" by Education Week, states are currently using seven different methods to report graduation rates for NCLB. The majority of states use one of the two methods outline below.

1. Thirty-three states use the Leaver Rate, which is the NCES method. This method calculates graduation rates by dividing the number of students who received standard high school diplomas by the total number of students who have dropped out, graduated with a standard diploma and graduated with other completion credentials. This method is sometimes called the departure-classification index.

2. Ten states use the Cohort Rate, a true longitudinal graduation rate, which calculates the percent of students from an entering ninth grade cohort who graduate with a regular diploma in four years. Adjustment to the original cohort may be made for students who join or leave the school system at grade level during that four-year period. While this method most accurately captures the true four-year graduation rate of a school, it can only be implemented if the state data system is capable of tracking individual students over time to accurately distinguish among a number of student outcomes (e.g., diploma recipient, recipient of credentials, dropout, transfer from school or district).

The remaining states use an assortment of indicators that include completion ratios, grade-to-grade promotion rates and dropout rates as proxy for graduation rates. States that incorporate dropout rates into their graduation rate formulas produce a higher estimate of the state graduation rate compared with other methods because dropout counts tend to be underreported. As a result of these varied approaches, the graduation rates reported for NCLB purposes are not comparable across states. That different states use different methods of calculation highlights the confusion that exists among graduation rates, dropout rates, and high school completion rates, each of which measures something unique.

This is changing, though, as states adopt the NGA formula, which follows a Cohort Rate. Thus, the number of states using each rate will likely shift in the coming years. 2006 is the earliest states have committed to report rates using NGA’s common formula, and as this report is being written, these numbers are not yet in. Thirteen states will soon release their rates using the NGA formula. By 2010, 39 states plan to use the same calculation, which should ease the comparison-making process.

The table below defines the differences among graduation rates, dropout rates and high school completion rates and what they measure:

Graduation Rate (4-year completion)	Status Dropout Rate	Event Dropout Rate	Completion Rate
Measures the percentage of ninth graders who left school with a diploma four years later.	Measures the percentage of 16- to 24-year-olds not in school and without a diploma.	Measures the percentage of students leaving high school each year without a diploma.	Measures the percentage of 18- to 24-year-olds who have a diploma.

These definitions and data are cited in an NCES-commissioned report "Dropout Rates in the United States: 2001," by Philip Kaufman and Martha Naomi Alt, MPR Associates Inc., and Christopher D. Chapman, NCES (November 2004). Event dropout rates, status dropout rates, and status completion rates count GED recipients among those with diplomas and capture both public and private school students; four-year completion rates capture public school students only.