Thumbing its nose at President Bush's No Child Left Behind (search) education law, Utah this week enacted legislation to give its own state education standards priority over federal rules.

"This clearly is a signal that local leadership, local decision-making are extremely important when it comes to education policy," said Utah's Republican Gov. Jon Huntsman (search).

Utah is one of 16 states challenging or considering challenges to NCLB. Many state officials say they think the law is too rigid in measuring student proficiency and often conflicts with how states track their own progress.

"Our state felt to say 'enough is enough,'" said Utah Superintendent of Public Instruction Patti Harrington.

Education Secretary Margaret Spellings (search) says that the action by Utah's largely Republican Legislature could cost the state $476 million in federal aid if it strays too far from the law. Educators in Utah and other states say they are willing to take that gamble.

"It's a good idea in principle, but it doesn't fit for each child," said Vae View Elementary School teacher Judy Chesley.

The problem, many educators say, is that even if a school comes jut under the bar, it's still inadequate in the eyes of the federal government.

Vae View Elementary, located near Salt Lake City, is considered a failed school despite passing 39 out of 40 subjects. Under NCLB, it must offer parents the option of transferring their students to a better-performing school.

"To lose it on one, no, we don't think that's fair. Our parents don't think that's fair," said school principal Eric Holmes.

Last week, Bush insisted that America's schools are closing the learning gap between white and minority, poor and middle-class students.

Of Utah's decision, Spellings said in a statement: "Turning back the clock and returning to the pre-NCLB days of fuzzy accountability and hiding children in averages will do nothing to help the students who are currently in Utah's schools."

Many educators say while they agree with the intent of NCLB, its pass-fail approach ignores progress, especially that made by students with developmental disabilities. Spellings recently loosened the requirements on those students, but states like Utah say they still need more sovereignty.

Click in the box near the top of the story to watch a report by FOX News' Alicia Acuna.