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This is the 12th annual report on conditions affecting the Racine Unified School District (RUSD). This year, the analysis again focuses on the long-term historical trends in RUSD. The analysis compares RUSD data to data of nine peer school districts as well as statewide data. The peer districts are defined as those Wisconsin districts with enrollments most similar to the enrollment in Racine. In addition to enrollment trends, the findings pertain to three RUSD quality objective measures: operational efficiency, student engagement, and student achievement. Operational efficiency includes finance data, student engagement includes attendance and disciplinary data, while student achievement includes test scores and graduation rates. Major findings include: (1) RUSD enrollment declined for the second year in a row; (2) RUSD jumped up in the peer rankings, from seventh to fourth, in terms of operations revenue per pupil (now at $11,222); (3) The 2007-08 drop-out rate in Racine was 6.6%, the highest rate since 1999-00; and (4) Racine’s test scores lag behind the state average in all grades and subjects examined: third grade reading, fourth grade reading and math, eighth grade reading and math, and 10th grade reading and math. (Contains 33 tables and 23 figures.) [This paper was commissioned by Education Racine, Inc.]