The present study investigates the overall quality of basic schools located in the capital of the Brazilian states, between 1996 and 2005, taking into account the extensive changes throughout Brazilian education system, specially major improvement in the Brazilian educational flux, the roll of municipal administration on education, as well as the different ways in which each of the aforementioned factors influenced municipal and state schools. At first, our study not only analyses the evolution of three basic schools quality indexes - school performance, retention rates, and overage rates - of both municipal and state schools located in capital of the Brazilian states, but also the mapping of government implemented education policies in the mentioned period. Subsequently, we study the relationship between the public policies on schools performance, using the available information of Brazilian Assessment of Educational Progress (SAEB), 4th grade, in data base for 1999, 2001, and 2003. The multi- level estimation results showed that policies related to schools principals choosing process, teachers´ education and childhood education are associated to an increased schools performance. Another object of analysis is the quality of education for the cohort of 10 year-olds. The results indicate stability for 10 year-olds advancement performance to the capital of the Brazilian states. Consequences for educational policy are discussed.