For the past decade, federal funding for education has been based on student performance on annual standardized tests. Now the Obama Administration is giving states more flexibility in measuring achievement.

In the U.S. state of Colorado, a new measurement tool calculates academic growth as well as achievement, by factoring in a number of elements - such as test scores, family income levels, school size and student ethnicity.

Great expectations

It's an assessment tool that works for West Denver Prep principal Josh Smith, who greets his middle school students every morning by shaking hands with each one of them.

"I am a firm believer that, when you're 11 years old," Smith says, "it means a great deal if the principal knows your name."

Smith also believes in teachable moments, so he invites students to expand their vocabulary, with a synonym for saying, 'I'm good.'

"How are you this morning?" he asked one student.

"Phenomenal," the student replies.

"Phenomenal!" Smith says. "I love it."

Since many of these students come from homes where parents don't speak English, this word game can be challenging. But it's fun, says eighth grader Juan Soltero, who adds that these games, along with studying hard, have given him high expectations.

"I want to be an electrical engineer," Juan says. "The teachers, they really want you to learn. They really do love you. They give you support and talk you through things. It's not just about academics. You have to be comfortable in learning so you can just, stick it in your head."

Gaining ground

Most students at West Denver Prep don't start out this confident. On average, students enter 6th grade lagging academically. However, just three years later, most are outperforming their peers statewide.

The new assessment method shows the typical West Denver Prep student learns more math each year than 94 percent of all students in Colorado. Reading and writing scores also show growth.

"This is an incredible number really," says Bill Bonk, one of the creators of the measurement tool, called the Colorado Growth Model. "This is a place where there's a lot of learning going on."

The results of the Colorado Growth Model calculations are posted in an online graph.

West Denver Prep's principal, Josh Smith, likes to fire up his students by showing them the graph - and how far they've come.

"Every child wants to be successful," he says. "Every person wants to be successful."

Good fit

The Colorado Growth Model also fits Smith's philosophy about motivating kids.

"You praise them like crazy when they make a good decision, when they get an 'A' on that quiz, or when they get a 'D' on that test and they got an 'F' on that test the week before," Smith says. "It's the same level of success, they feel good about doing good, and they want to continue to do better."

While West Denver Prep sets high standards for its middle school students, Smith thinks believing in the students is a big reason for the school's academic success.

"They're middle schoolers. They roll their eyes and think, 'Oh, crazy Mr. Smith talking again about how brilliant I am,'" Smith says. "I hope that someday, they look back and see me as the crazy guy that kept telling them, every day, 'You're amazing! You're amazing!' And they thought I was wacky and they got so sick and tired of it. But somewhere along the line, they believe it, right? They believe it and they know it. That's the goal."

And by focusing on academic growth - not just achievement - Colorado schools are helping more students reach that goal.