Adults are considered functionally illiterate if they have trouble doing such things as comprehending bus schedules, reading maps and filling out job applications.
The study by the State Education Agency, a quasi-governmental office created by the U.S. Department of Education to distribute federal funds for literacy services, was ordered by Mayor Anthony A. Williams in 2003 as part of his four-year, $4 million adult literacy initiative.
The growing number of Hispanic and Ethiopian immigrants who aren't proficient in English contributed to the city's high functional illiteracy level, which translated to 170,000 people, said Connie Spinner, director of the State Education Agency. The report says the district's functional illiteracy rate is 36 percent and the nation's 21 percent.
Adults age 65 and older had the lowest literacy score of any group, the report found.
The District of Columbia Chamber of Commerce, which contributed to the report, said the city lost up to $107 million in taxes annually between 2000 and 2005 because of a lack of qualified job applicants.