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For-Profit Company Seeks Contracts To Run Districts

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A for-profit firm whose president is a former Tennessee commissioner of education is promoting itself as "the first American company whose sole goal and purpose is the privatization of the American public education system."

The firm, Education Enterprises of America, is pursuing contracts with local school boards to run individual schools or entire school districts using management techniques common to large corporations.

"We believe there are school systems across the country who have tried and failed to make the progress they would like to make, and who would be interested in determining whether or not the private sector can do better than they've been able to do," Sam H. Ingram, Tennessee's school chief from 1975 to 1978, said in an interview last week.

"It's time we answered the question that private businessmen are continuing to ask," he said, "and that is, 'Why don't we run schools like a business?"'

Mr. Ingram spent the past 11 years as president of Middle Tennessee State University before becoming the company's president and chief operating officer in January.

The firm, based in Nashville, was founded in 1988 by Willis C. Nowell, a former director of psychological services and federal programs for the Tennessee education department. Mr. Nowell is the company's chairman and chief executive officer.

Educational Enterprises announced its plans at a press conference last month in Nashville.

According to Mr. Nowell, the company expects to sign its first management contract--to run a division of a Tennessee school district--within the next month. A school district in Mississippi has also expressed interest, he said.

The firm, which also owns several day-care centers in Tennessee, currently provides training in teacher motivation and parent involvement for five school districts in the state.

Precedents Elsewhere

By using "central planning, mass purchasing, and the elimination of bureaucratic waste," the firm pledges to run schools more efficiently, according to its promotional materials.

But the company's focus will be on improving a school or district's instructional program, Mr. Nowell stressed, not on management techniques alone. Educational Enterprises is primarily interested in elementary education, he said, and advocates such techniques as having students tutor one another.

To help accomplish its goals in cases where funding may be lacking, the firm proposes to set up local foundations to channel corporate donations to schools under its management.

While many districts contract with for-profit companies to provide food, janitorial, and transportation services, the idea of turning over a public school system's entire instructional program to an outside company is relatively new.

The Dade County, Fla., system is expected to sign a contract in June with a profit-making Minneapolis firm to design and manage an elementary school in partnership with the district. The firm, Education Alternatives, is a spinoff of the Control Data Corporation. It operates private schools in Minnesota and Arizona.

Perhaps the best-known example of turning control of a public system over to an outside entity is Boston University's contract to manage the troubled Chelsea, Mass., district.

In Chicago, corporations have provided money for a tuition-free private school, the Corporate-Community School, which is run using corporate management techniques.

Private 'Mystique'?

In Tennessee, meanwhile, the reaction to the "privatization" approach being advanced by Mr. Nowell and Mr. Ingram is mixed.

"I'm going to be surprised if we have a great line of people waiting to take advantage of their services," said Dan Tollett, executive director of the Tennessee School Boards Association.

"But I'd be in favor of giving it a fair shake," he added. "We can't afford to be so protective of our own territory that we aren't interested in looking at other solutions."

The company officials said they would not seek exemptions from local teachers' contracts or from state or federal laws regulating schools.

"We'd have to answer to the school board," Mr. Ingram said, "but we would not accept a contract without the kinds of provisions to enable us to do what we believe would need to be done."

Given the fact that Educational Enterprises would operate under existing constraints, said Cavit Cheshier, executive secretary of the Tennessee Education Association, it is not clear how its proposed arrangement would improve schools.

"Just the fact that [the company] is a private enterprise doesn't mean that it has a corner on honesty, integrity, or ability," Mr. Cheshier said. "We'd better look very carefully before we jump to the mystique that because it's run privately, it is automatically better."

Thomas A. Shannon, executive director of the National School Boards Association, also cautioned that Mr. Ingram and Mr. Nowell's background with a state department of education was "worlds apart from being in the rough-and-tumble world of local district administration."

Myron Lieberman, an education consultant and author of Privatization and Educational Choice, voiced another reservation.

Mr. Lieberman, who advocates privatizing the management of education to leave school boards free to devote themselves to educational policy, asserted that Education Enterprises' proposal to manage instructional programs "is not the strongest argument for contracting out management."

"The choices about curriculum stand in a little different context than having a database about energy use," he said.

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