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Like it or not, the financial landscape of educational technology is changing. Technology Counts 2005鈥攖he eighth edition of 91制片厂视频 Week鈥檚 annual report on educational technology鈥攖racks the economic and policy forces that are converging to push those changes, which are happening at the federal, state, and local levels.

Technology Counts 2005
Electronic Transfer
NCLB Focuses on Data Tools
State Support Varies Widely
Federal Role Seen Shifting
Schools Eye Future Costs
State Data
State Snapshots
Table of Contents

States and school districts are spending millions of dollars to build online student-data systems that will offer teachers what policymakers hope will be the information needed to craft clear-cut strategies for raising achievement. The biggest impetus for putting money into such data systems is arguably the expansive reporting requirements and ambitious student-achievement goals set forth in the federal No Child Left Behind Act.

Today鈥檚 growing emphasis on data-management technologies is overshadowing the priorities of past years, when states and schools focused on putting better instructional technologies鈥攕uch as personal computers and learning software鈥攊nto classrooms.

鈥淭his is a new phenomenon based on NCLB,鈥� says Irene K. Spero, the vice president of the Consortium for School Networking, or CoSN, a Washington-based advocacy group for the use of technology in education.

In a survey of state officials conducted for Technology Counts by the 91制片厂视频 Week Research Center, 15 states reported that the 3-year-old No Child Left Behind Act had influenced their decisions to put in place bigger and better data-collection systems.

Underlying the trend is a major philosophical shift in the White House concerning the role of technology in education. During the Clinton administration, federal leaders largely viewed technology as a way to open new educational horizons. Now, under the current administration and the demands of the education law championed by President Bush, the emphasis is on technology as a tool for analyzing achievement data.

At the same time, continuing budget deficits in many states are forcing them to focus their technology spending more narrowly.

Technology directors in 44 states and the District of Columbia say inadequate funding or competition from other spending priorities are the biggest challenges they face in trying to pay for K-12 technology, according to the 91制片厂视频 Week Research Center survey. Of those states, 16 pointed to recent cuts in federal aid, while 14 states said lack of state money was a great challenge. Ten states also mentioned a lack of sustained funding for K-12 technology as a main problem.

Another reason for the dip in funding is that technology no longer generates the buzz it did in the high-flying years of the tech boom, suggests Michael Griffith, a senior policy analyst for the 91制片厂视频 Commission of the States. In the 1990s, national and state attention focused on equipping schools with computers and wiring them to the Internet. But now, almost all schools are connected to the Internet, and the number of school computers has reached a critical mass, Griffith says.

Still, he cautions that technology costs have not gone away. Money is needed to upgrade networks and computers, train teachers in uses of technology for raising student achievement, and build the data-management systems states need to keep up with the reporting requirements of the No Child Left Behind law.

Meanwhile, the increasing popularity of state-sponsored virtual schools raises questions about spending priorities. So far, 22 states have established virtual schools, and more may be on the way. The largest state-sponsored online school, the Florida Virtual School, achieved greater financial stability when it became the Sunshine State鈥檚 73rd school district during the 2003-04 school year. It now gets state aid through a set per-pupil amount, just like any other district.

But virtual schools run by other states have not achieved that status, and instead have to rely on a mixture of federal, state, and private aid to stay afloat. And some of those funding sources have dwindled in recent years.

鈥淔or state virtual schools to truly become established, 鈥� there needs to be a reliable funding stream,鈥� says William R. Thomas, the educational technology director for the Southern Regional 91制片厂视频 Board. 鈥淭hey can鈥檛 go out every year with their hands out to ask for funding. In good times, that works just fine. In bad times鈥攐h boy, you鈥檙e in trouble.鈥�

And some tough times may be ahead, especially for states that rely heavily on federal aid to sustain or start educational technology programs.

In February 2005, the Bush administration asked Congress to wipe out all the money for the major federal grant program that, in several versions over the past decade, has provided nearly a half-billion dollars annually in support of schools. The proposed zeroing-out of the $500 million technology-grant fund represents the lion鈥檚 share in President Bush鈥檚 suggested fiscal 2006 cuts to education, which could be docked by $530 million overall.

Even if Congress refuses to eliminate the grants, the proposal makes clear the administration鈥檚 view that most targeted federal spending on most forms of technology used in schools has run its course.

Federal officials are also scrutinizing the E-rate program鈥攚hich provides more than $2 billion a year for telecommunications services and equipment in schools鈥攖o decide whether it needs to be overhauled or even ended.

At the local level, Technology Counts 2005 examines some important school district angles on technology spending, such as the growing use of a business-style approach, called 鈥渢otal cost of ownership,鈥� to predict the future costs of technology. The report looks as well at the technology spending priorities of some of the biggest districts.

For the first time ever, the report also ranks the states based on a number of educational technology factors, such as students per instructional computer, student technology standards, e-learning initiatives, and the technology requirements included in certification for teachers and administrators.

Those state rankings and the spending theme of Technology Counts 2005 are supplemented by annual features of the report, such as a review of national trends in the use of educational technology, snapshots of the steps states have taken to use such technology more effectively, and recent state budget pictures. Data tables with state-by-state statistics on technology in schools are also included.

We hope you鈥檒l find information here that will help you understand how economic and policy forces are changing the financial landscape of educational technology, and how those changes could affect schools in your state and community.

鈥擳HE EDITORS