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City school officials have underreported the number of students who dropped out of high school in the past by reclassifying some of them, according to a report released by the State Comptroller today.

The report, which comes out of an audit completed by Comptroller Tom DiNapoli’s office in January, examines a group of students that are labeled as “discharged,” meaning they have left the school system for legitimate reasons, such as moving to another state or deciding to enroll in a G.E.D. program. It finds that some of these students should actually have been labeled as drop-outs, but because of paperwork errors or school officials’ failure to follow state regulations in certain cases, they were counted as discharged.

Students who are discharged don’t count towards the city’s drop-out rate and some advocates have argued that principals can misuse the discharge code, entering students who simply dropped out in order to inflate their graduation rate artificially. Overall, the comptroller’s report found that even with the improper discharge classifications taken into account, the city’s graduation rate was “generally accurate.”

To determine whether the city’s Department of Education was improperly classifying drop-outs as discharges, auditors in the comptroller’s office examined the records of students who started high school in 2004 and should have graduated in 2008, but were discharged along the way. They randomly chose 500 of the 17,025 general education students who were discharged and 100 of the 1,923 discharged special education students. (more…)