States are helping public schools escape potential penalties by skirting the No Child Left Behind law’s requirement that students of all races must show annual academic progress.

With the federal government’s permission, schools deliberately aren’t counting the test scores of nearly 2 million students nationwide when they report progress by racial groups, an Associated Press computer analysis found.

Minorities – who historically haven’t fared as well as whites in testing – make up the vast majority of students whose scores are being excluded, AP found. And the numbers have been rising.

Under the law championed by President Bush, all public school students must be proficient in reading and math by 2014, although only children above second grade are required to be tested.

Schools receiving federal poverty aid also must demonstrate annually that students in all racial categories are progressing or risk penalties that include extending the school year, changing curriculum or firing administrators and teachers.

The U.S. Education Department said it didn’t know the breadth of schools’ undercounting until seeing AP’s findings.

“Is it too many? You bet,” Education Secretary Margaret Spellings said in an interview. “Are there things we need to do to look at that, batten down the hatches, make sure those kids are part of the system? You bet.”

Students whose tests aren’t being counted in required categories include Hispanics in California who don’t speak English well, blacks in the Chicago suburbs, American Indians in the Northwest and special education students in Virginia, AP found.

Bush’s home state of Texas – once cited as a model for the federal law – excludes scores for two entire groups. No test scores from Texas’ 65,000 Asian students or from several thousand American Indian students are broken out by race. The same is true in Arkansas.

The law originally created the exemptions to make sure schools didn’t unfairly fail schools or compromise student privacy when they had just a small number of students in one racial category.

One consequence is that educators are creating a false picture of academic progress, but state educators defend the exemptions, saying minority students’ performance is still being included in their schools’ overall statistics even when they aren’t being counted in racial categories. Excluded minority students’ scores may be counted at the district or state level, officials said.

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