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The Business Of Schooling: Private Companies Offer Instructional Services

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This article is the eighth in an occasional series.

By Mark Walsh

BURKE, VA.--The customers start trickling into the Sylvan Learning Center here shortly after 3 P.M., just after school lets out in this Washington suburb.

Over the next four hours, more than two dozen students will arrive for hourlong tutoring sessions in reading, mathematics, or college-admissions-test preparation. Their goal is to get up to speed in their regular classwork or to gain the edge they want on the path to higher education.

Diane Fields, a pediatric nurse from nearby Springfield, Va., pays $35 an hour for twice-a-week sessions for her son Kevin, a 4th grader.

"Kevin is here to strengthen his reading ability and his attitude,'' Ms. Fields explained to a recent visitor at the center. "Also, to get the attention he can't get in a classroom of 28 [students].''

The extra attention and coaching in basic subjects that Ms. Fields and other, mostly middle-class parents are able to purchase for their children at the private, for-profit Sylvan centers will soon be available to more than 600 lower-income children in the Baltimore public schools.

In an agreement that officials of Sylvan Learning Systems see as the first of many similar arrangements with other school districts nationwide, the company will take over federal Chapter 1 remedial services for some of the eligible students in five Baltimore elementary schools on a pilot basis.

Under the plan, which was approved last week by the city's Board of Estimates, the firm will be paid $1.4 million for a one-year contract to establish satellite Sylvan Learning Centers in the schools.

"The idea is to make the Sylvan methodology available to kids who can't normally afford it,'' said Douglas Becker, Sylvan's president and chief executive officer. "Chapter 1 is the most likely and convenient place to make that happen. It identifies the children with the greatest need and provides a funding source.''

Although the five schools have yet to be chosen, the firm plans to start building the in-school centers soon and will begin offering instruction to the 660 participating students by early May.

Companies Gain Foothold

Sylvan's contract with the Baltimore district represents an expansion of the foothold that a number of commercial chains specializing in tutoring, supplemental instruction, and admissions-test preparation have gained in public schools in recent years.

Chains offering after-school academic help, including Sylvan, Huntington Learning Centers, and test-preparation specialists such as Stanley H. Kaplan Educational Centers and Princeton Review, have been called the American version of juku--the cram schools where Japanese parents send their children to prepare for national tests.

These American juku have largely been a suburban phenomenon--opened in shopping centers and professional buildings in areas where parents are able to pay sizable fees to give their children an academic boost beyond what they feel is available in their regular schools.

But the companies have also targeted the public schools themselves as a potentially lucrative market. (See Education Week, June 7, 1989.)

For Sylvan Learning, a division of Sylvan/KEE Systems, based in Columbia, Md., providing Chapter 1 services in public schools is a logical step. Sylvan has supplied the federally funded remedial instruction to students in several private schools in recent years.

Mr. Becker stresses that his company is not seeking to take over Baltimore's entire Chapter 1 program--the district has 79 schools serving eligible students. Nor does the contract call for Sylvan to serve all Chapter 1 students at the pilot schools.

"We are starting with some students at five schools,'' Mr. Becker said. "If we do a good job, they may add five more next year.''

Stretching Resources

Walter G. Amprey, the Baltimore superintendent, called the agreement with Sylvan "an exciting partnership'' that "allows us to stretch our resources as we could never do alone.''

"The federal government is demanding dramatic change and improvement in its Chapter 1 schools,'' Mr. Amprey said in a letter to the public released last week. "We in Baltimore have a vision that could bring dramatic results for our economically disadvantaged children and put us in the forefront of national program change.''

The Sylvan plan for Chapter 1 services includes maintaining a low pupil-teacher ratio--no more than three to one, the same as that offered in Sylvan's own centers--and the use of the firm's diagnostic tests and motivational techniques.

The contract also calls for Sylvan to significantly increase the math and reading scores of participating students; otherwise, the firm will provide a six-week remedial program in the summer of 1994 at no extra charge.

School officials will remain responsible for final standardized testing of the students and other qualitative assessments. The contract will be evaluated after one year.

The arrangement in some ways resembles the Baltimore district's much-discussed five-year contract with Education Alternatives Inc., under which that private firm is fully managing nine of the city's schools. (See Education Week, Sept. 16 and Oct. 14, 1992.)

While supporters of the Sylvan agreement see it as a chance to give less-advantaged youngsters the same kind of help more affluent students can obtain, some educators criticize such arrangements.

"I find it outrageous that it is the school districts with the most vulnerable children that are casting about like jumping beans for some magic bullet,'' said Bella Rosenberg, an assistant to Albert Shanker, the president of the American Federation of Teachers. "This would never happen in a middle-class community.''

Test-Coaching Classes

Another kind of for-profit service that has been controversial among educators--coaching for college-admissions tests--has also found a niche in public schools.

Stanley Kaplan, an industry leader in offering preparation courses for the Scholastic Aptitude Test and the American College Testing examination, among others, in its 150 centers nationwide, also has more than 200 in-school satellite programs taught by its instructors, company officials say.

"When I have approached schools, there is sometimes resistance based on the notion that this is an elitist thing,'' said Katherine Bredemeier, the director of Kaplan's Colorado regional office in Denver. "They say they don't want to support a company that charges for test preparation.''

"But that is usually just the start of a discussion,'' she said.

Kaplan and its competitors charge some hefty fees for test preparation. Kaplan offers a basic S.A.T. course for $150, a longer S.A.T. course for $565, and an A.C.T.-preparation course for $395.

When it contracts with schools, however, Kaplan usually offers discounts, and the schools themselves often pay all or some of the per-pupil bill, thus eliminating or further reducing the cost to students. The courses are taught by Kaplan personnel.

"We looked at doing it with our own people, but Kaplan has been doing it for many years,'' said William C. Larson, the principal of Ponderosa High School in Parker, Colo.

Ponderosa High pays for the instructors and offers the course during study halls and after school for a fee of about $40 per student, he said.

Mr. Larson said the school's arrangement with Kaplan has made test coaching accessible to more students, both by lowering the cost and eliminating the need to travel to Denver to take the course.

Foreign-Language Teachers

Remediation and test preparation are not the only educational services for which schools are seeking outside help.

Berlitz International Inc., which specializes in foreign-language instruction for business professionals, tourists, and students, has been signing up schools for five years for its Berlitz Jr. program.

More than 100 schools nationwide have hired Berlitz instructors on a part-time basis. Berlitz serves mainly private schools, especially Roman Catholic ones, but public schools have also contracted with the company.

"The flexibility for our clients is that they don't have to hire a full-time teacher,'' said Margaret Sapir, the managing director of the Berlitz Jr. program.

High Tech High School, a magnet program in the Hudson County, N.J., school district, hired Berlitz last year to teach Japanese, and this year added Spanish.

"The prospect of hiring a teacher full time to teach two sections of Japanese was difficult for us financially,'' said Karol Brancato, the principal. "Berlitz was very cost-effective for us.''

She also praised the company's commitment to using native speakers of the language being taught.

But because the Berlitz instructors at High Tech High School are not state-certified, students do not get high school credit for the coursework, Ms. Brancato noted. The school has arranged for them to receive college credit, however.

Sylvan's Growing Presence

Sylvan Learning's foray into public education comes after a series of significant business developments for the company, which has annual sales of about $100 million and serves some 100,000 students.

A parent looking for tutoring services in the the local Yellow Pages in recent years would likely have found, alongside the listings of individual tutors and small local centers, an advertisement from at least one of three nationally franchised chains: Sylvan, Huntington, and Britannica Learning Centers.

The chains varied in their approach, to some degree, but all charged parents for diagnostic tests and anywhere from $21 to $38 an hour for help in reading and mathematics. Students generally received help at a pupil-teacher ratio as low as three to one. Sylvan had about 460 centers last year, Huntington had 90, and Britannica, 85.

Last year, however, Sylvan bolstered its dominance in the field when Encyclopaedia Britannica U.S.A. sold off the Britannica chain. The new owner, American Learning Inc., decided to convert most of the 85 centers to Sylvan franchises, while closing or merging those that were already near a Sylvan outlet.

The shift gives Sylvan a stronger presence in key markets in California and suburban New York City.

"In essence, what A.L.I. is becoming is the largest franchise owner of Sylvan Learning Centers,'' said Paula Singer, the executive vice president and general manager of American Learning, which is based in Chicago.

"Right now, the business is really changing,'' she said of Sylvan's push for public school contracts and other initiatives.

"We think we can contribute in the public sector,'' Ms. Singer said. "It's nice to reach out into areas where students might not be able to afford our services, where's it's not just suburban kids.''

Eventually, about 50 Britannica centers will end up becoming Sylvan centers, pushing the total above 500 in the United States and Canada.

That leaves Sylvan in the marketplace with only two other major chains--Huntington and a newer entry in the field, the Kumon Educational Institute Ltd.

The Japanese-owned Kumon primarily offers a drill-and-practice system of teaching math that has been growing in popularity among American educators. (See Education Week, May 17, 1989.)

Kumon sells its materials to schools and to its estimated 800 U.S. franchisees. The firm now also offers an individualized reading program.

Computer-Based Services

Two years ago, KEE Systems, a computer-training firm, acquired a 50 percent stake in Sylvan from Kinder-Care Learning Centers Inc., the child-care firm. Mr. Becker took management control of the Sylvan centers in the merged company.

Earlier this year, Sylvan/KEE Systems raised the capital to buy out the rest of Kinder-Care's stake in Sylvan.

A number of the company's outlets, including the one in Burke, Va., have added areas full of personal computers for training classes and standardized testing. They are known as Sylvan Technology Centers.

Through contracts with the Educational Testing Service, Sylvan now offers computerized versions of the Graduate Record Examination and the Praxis teachers' test. It also offers some Federal Aviation Administration exams and a major nursing test.

Sylvan does not offer a computerized S.A.T. or A.C.T.--yet. But Mr. Becker said that the E.T.S. may soon pilot its computer S.A.T., now under development, at a few Sylvan centers.

Sylvan Learning executives, meanwhile, express high hopes for making further inroads in the public school market. In addition to Baltimore, 15 or so urban school systems have held discussions with the company about contracting for Chapter 1 services, according to Mr. Becker.

Even some state Chapter 1 coordinators have looked at whether Sylvan could aid in the "program improvement'' requirements under the federal program, he added.

Seeking a Wider Market

Mr. Becker said he envisions creating mini-Sylvan Learning Centers in public schools, with the same look and features of the company's retail outlets.

He also pictures guaranteeing academic improvement for public school pupils served by Sylvan. At its existing learning centers, Sylvan promises to raise a student's performance in math or reading by one grade level in 36 hours of instruction, with free extra instruction until the goal is met.

Mr. Becker also suggested that, in addition to serving Chapter 1 students, school-based Sylvan centers could be opened to local communities at lower rates than those charged in suburban centers.

"We serve about 100,000 kids from a well-to-do, suburban, middle-class background,'' Mr. Becker added, "but there are five million kids who have an equal need whose parents don't have the means to pay for it.''

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