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Published in Print: August 7, 2002, as Phila. Lines Up Outside Groups To Run Schools

Phila. Lines Up Outside Groups To Run Schools

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With one of urban education's heavy hitters at the helm, the Philadelphia school district is getting down to the nuts and bolts of the biggest school privatization experiment in the country. But with only a month to go before schools open, the path to improvement is anything but smooth.

Paul G. Vallas, the straight-talking budget whiz who ran Chicago's schools for six years, took over as the Philadelphia schools' chief executive officer on July 17. He made good on his vow to "get in the middle of everything," meeting with parents and visiting classrooms even before his suitcases were unpacked.

Mr. Vallas assembled a transition team to help him evaluate the district's $1.7 billion budget and draft educational and financial plans. He said he intends a "radical reprioritization" in district finances, shifting money from administration to programs he believes raise student performance, such as summer school, universal preschool, and an extended school day.

Steering the Chicago district's restructuring from 1995 to 2001 has made Mr. Vallas no stranger to conflict and controversy. He found plenty of both the minute he arrived in Philadelphia: State and city leaders were bickering over how to distribute the state money pivotal to the overhaul of the 200,000-student district. And none of the seven outside managers set to take over 45 schools had a signed contract.

Five-year contracts totaling $120 million were not final until July 31, only five weeks before school starts on Sept. 5. The outside groups, which had hoped for signed contracts last spring, scurried to ready their schools for opening.

Mr. Vallas reacted to the tumult with determination and humor. Quoting an actor in the film "Apollo 13," the movie buff said simply: "Failure is not an option."

'Stakes Are High'

Finances and test scores in the nation's eighth-largest school system are so battered that the state of Pennsylvania took the district over last December, replacing its school board with a five-member School Reform Commission appointed by the city and the state. The improvement plan has sparked both support and intense opposition because of the unusually large role given to private school managers. ("Groups Named to Lead Dozens of Ailing Phila. Schools," April 24, 2002.) The plan calls for the 264-school district to hand over 45 of its lowest-performing schools to outside firms or managers, the largest-scale such undertaking ever attempted. Another 25 struggling schools will be converted to charters or reconstituted and run by the district. Another 16 that are lagging but making progress will receive additional financial help.

Three for-profit companies will be paid a total of $18 million this coming school year to run 30 Philadelphia schools. Edison Schools Inc., the nation's largest private operator of public schools, gets the lion's share: $11.8 million for managing 20 schools. Victory Schools—based, like Edison, in New York City—and Chancellor Beacon Academies, based in Miami, will each operate five.

Fifteen schools will be managed by four nonprofit groups or institutions: Temple University; the University of Pennsylvania; Universal Companies, a local neighborhood-redevelopment group; and Foundations Inc., a Mount Laurel, N.J.-based provider of after-school programs. They will be paid a total of $3.7 million this year.

As the dysfunction of many urban schools rises higher on the nation's radar, experts across the country are watching with interest—and, in many cases, skepticism—as yet another big American city mounts a major effort to improve its schools.

"This is the most exciting thing going in education since Chicago," the scene of an ambitious reform drive in the mid-1990s, said Wilbur C. Rich, who focuses on education governance as a political science professor at Wellesley College in Wellesley, Mass.

"Everyone agrees that urban education is not working, and we're trying a variety of things to see what works," Mr. Rich said. "So the stakes are very high in Philadelphia. How are they going to implement this stuff? What looks good on paper might not work in reality."

To ensure improvement at the 70 targeted schools, and to finance other district-wide endeavors such as new textbooks and teacher training, the city of Philadelphia committed $45 million in new money to the schools. The state approved $83 million, despite the grumbling of many lawmakers who view the district as a money pit and whose own home-district school funding was flat-lined in a tight budget year.

Strings Attached

But as the city soon learned, state Secretary of Education Charles B. Zogby had tied a big string to the money: The schools managed by outside groups must get first crack at $55 million of it. In a scathing July 18 letter to the chairman of the school reform commission, Mr. Zogby insisted that those schools receive a higher funding level to ensure real improvement.

That condition prompted cries of cronyism, since Edison has long- standing ties to the Republican Pennsylvania governor's office.

"Even if there hasn't been any impropriety, it sure looks that way on the surface," said George P. White, a professor of educational leadership at Lehigh University in Bethlehem, Pa.

Edison officials dismissed allegations of unfair play. The undisclosed amount of money offered by the school reform commission was insufficient to fully implement Edison's program, so company officials let state leaders know how much money they needed, said company spokesman Adam Tucker.

When the dust cleared, a compromise emerged. Edison and most of the other private providers will get higher per-pupil funding than other schools, but they will not get all of the $55 million. They will share it with a list of low-performing schools that expanded from 70 to 86. The rest of the $83 million in state aid, combined with district money, will finance districtwide improvements, such as summer school and literacy programs.

Edison, which has endured steady and vocal opposition from Philadelphians opposed to the private management of public schools, has watched its stock value fall as its role in the city of Brotherly Love has dwindled.

Last winter, Gov. Mark S. Schweiker proposed that Edison operate the entire district, but opposition snuffed out that plan. The company then hoped to run 45 schools and land a six-year, $101 million contract to act as a management consultant.

By the spring, the school reform commission offered Edison the chance to serve as a consultant and to run 20 schools. Dollar figures on those two proposals were not publicly revealed, but sources told Education Week that Edison wanted $18 million to $24 million for the consulting contract.

But after Mr. Vallas arrived in Philadelphia, he put the kibosh on the consulting arrangement.

"We don't need a 'lead education consultant,'" said Mr. Vallas, who is earning $225,000 a year as CEO. "That's what I'm here for."

Teacher Vacancies

As education leaders in the district wrestled over how to implement the massive restructuring, community members, teachers, and parents were trying to adapt to the changes, with a mix of optimism, doubt, and anger.

Officials of the Philadelphia Federation of Teachers, which represents the city's 13,000 teachers, expressed worries that the 70 target schools will not be properly staffed when school opens. They noted that of the approximately 275 current teacher vacancies in the district, more than half were in those schools.

But the outside providers said they were confident they would have the openings filled by the first day of school.

The union, an American Federation of Teachers affiliate that has opposed private management of the schools, was also concerned that teachers at the 45 schools to be run by Edison and other providers had too little information about their assignments and curricula to operate effectively.

"Many teachers still don't know what the program is," said PFT spokeswoman Barbara Goodman. "There is the potential for utter chaos when school opens."

Judy Sweeney doesn't expect chaos, but she confesses to some anxiety. She teaches at one of the schools Edison will run, Penn-Treaty Middle School, which serves 800 predominantly Hispanic children from low-income families in the city's Kensington neighborhood.

Edison's approach "sounds good," she said, and most teachers in the building have attended Edison training, but she and other teachers still are uncertain what their duties will be.

"We met with the principal, and we had some questions he couldn't answer," said Ms. Sweeney. "One algebra teacher wanted to know if she would still be teaching that. We wanted to know if there was going to be an extended day. We just don't have answers yet."

At another Edison school, Gillespie Middle School in North Philadelphia, the early signs of Edison's management are receiving high marks from Principal Romesa Scott. A tractor-trailer pulled up last month and unloaded new books, science equipment, and other supplies in a "precision operation," she said. Leaders of the 700-student school were flown to Atlanta in mid-July for training.

"Edison's program proposes to attack the very issues we have identified at the school," Ms. Scott said, such as stronger discipline and better parent outreach. "What this will take is a real concentrated effort to do things differently," she said. "The people I have been interacting with believe it can happen, but it's going to be difficult."

Some city residents complain that the outside groups have not reached out adequately to involve community groups or inform parents. The state takeover plan envisioned that each school under outside management would "partner" with a community organization; the role was seen as pivotal enough that the 70 schools on the list were referred to as "partnership schools."

A number of groups sought permission from the reform commission to play that role, but as of the last week of July, no groups had been chosen as partners.

Some parents reported feeling out of the loop. Benita Clark, who lives in southwestern Philadelphia, said a nephew who lives with her is slated to attend a middle school being taken over by Edison, but she has heard nothing from the company and doesn't know what to expect.

Mr. Tucker, the Edison spokesman, said the company sent several letters home with students last spring describing the company's plans and providing the company's Web address and toll- free telephone number.

"They promised a partnership that would gather parents so we are informed and active," said Ms. Clark, who also has a daughter in high school. "But my neighbors and myself, no one's been contacted. Parents don't know what's going on. We're concerned."

Associate Editor Mark Walsh contributed to this story.

Vol. 21, Issue 43, Pages 1,18-19

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