Troubled Districts Face Takeover . . . By Private Firms

Troubled Districts Face Takeover . . . By Private Firms
April 1, 2000



While it's relatively easy for state policy makers to identify a failing school district and then take it over, legislators around the country are beginning to realize it's another matter entirely to turn the performance of that district around.

As a result, private firms like the Edison Company, Mosaica, and Advantage Schools are increasingly being viewed and courted, not only as a source of the expertise needed to run school districts more efficiently, but also to establish clear accountability for getting the job done.

Because of the way their contracts were written, Education Alternatives, Inc. (EAI) --now the TesseracT Group, Inc.--was unable to exercise the control it needed during the 1990s to turn around the Hartford school system in Connecticut or a group of schools the company had taken over in Baltimore, Maryland. However, since the company was ousted, little improvement has been achieved under the new management.



Few Results Seen in Hartford

For example, the state-appointed overseers of the Hartford school system last summer gave themselves two more years of control to initiate what Chairman Robert Furek called "programmatic goals" after initiating "substantial changes" since the takeover of the financially and academically troubled district in June 1997.

Although EAI was criticized for not raising test scores, the accomplishments claimed by the new trustees are devoid of academic achievement:

  • paying outstanding bills;
  • securing money for school repairs; and
  • hiring a new superintendent.



Even Fewer Results in Newark

Those responsible for the Newark, New Jersey, school district--the State Department of Education--achieved even less than the Hartford trustees in the four years since 1995, when the state appointed Superintendent Beverly L. Hall to run that financially and academically troubled district.

In January, State Education Commissioner David C. Hespe reported that poor bookkeeping had led to a $58 million hole in the district's almost $500 million budget. While there's no evidence of criminal wrongdoing, Hespe is seeking further explanations for the shortfall.

"What we don't know is what other problems in the business office may have contributed to this," Hespe told the New Jersey Star-Ledger. "And we don't know what problems were reported by who and when and what actions did take place."

Republican Senator Robert J. Martin, chairman of the Senate education committee, expressed shock, telling Education Week, "I never expected we'd see anything like this [deficit] with a state-run school district."

But an outside study of the state Department of Education found such an array of managerial shortcomings in the agency that its effectiveness was compromised. The study, conducted by the Washington, DC-based Council of Chief School Officers and made available in early February, revealed an agency understaffed for the magnitude of the tasks it was charged with: responsibility for implementing reforms, running three of the state's largest school districts, and overhauling budgets in 30 others.

"If you're going to bring change to 420 schools, you have to look at whether you have the staffing to provide the assistance . . . [and] I don't think you do," Council advisor Jack MacDonald told the New Jersey Star-Ledger. "You have to put the resources there, the best quality of people you have in the state," he added.