If you didn't catch the statistical error in the news report, re-read it. Mr. Albertson wants more than half of the students in his state to score above the 50% mark. This does not mean answering more than 50% of the questions correctly. It means he wants more half the students taking the test to do better than 50% of the students that take the test. (If that last sentence didn't make since don't blame me, blame Mr. Albertson's bill)
I haven't spent a lot of time reading about ways to improve public schools - I figure I'll think about it more once I have kids. However, when that day comes, I'll probably start with the Cato Blog.