PRIVATIZED LIVES

By ELIZABETH GLEICK

THE SALES PITCH WAS DAZZLING, THE promises irresistible. Dilapidated school buildings would be renovated, and fancy computer labs installed. Class size would go down, and test scores up. Less money would be spent on the bureaucracy, and more where it counted: on the students. And Hartford's public schools would maybe slowly raise themselves out of the gutter of the Connecticut school system. All this, and more, was hoped for last year when Education Alternatives, Inc. landed a five-year contract to run Hartford's entire 32-school district and its $200 million budget.

A few years ago, the concept of privatization--in which a for-profit company takes over the management of some, or all, school functions--seemed like it might be a magic bullet for the nation's ailing, bureaucratically entrenched public schools. Now it appears that the champions of privatization may have seriously underestimated the challenges--political, organizational and financial--of such radical change. Christopher Whittle's highly touted Edison Project has only four schools in operation. Education Alternatives, Inc., based in Bloomington, Minnesota, has signed no new clients in more than a year. Its contract to manage an elementary school in Miami Beach, Florida, expired last June; its nine-school project in Baltimore, Maryland, remains controversial, and its high-stakes deal in Hartford, the largest privatization experiment in the nation, is on the verge of collapse.

In fact, the problems in Hartford could cripple EAI. Because the company agreed to assume all costs of reform up front in return for one half of every dollar it saved the school district, EAI is now out about $10 million, and the company's stock, which has fallen to $7.50 from a historic high of $48.75 in 1993, reflects that loss. EAI's chief operating officer, William Goins, stepped down last week, claiming differences in "leadership styles." Meanwhile, the Hartford Board of Education, which has already wrested back control of 26 out of 32 schools, is so unhappy with the company's performance that it refuses to allow EAI to manage the school budget and insists that because there have been no savings, there will be no reimbursement of expenses. Unless EAI supporters win three out of the five open seats in this week's school-board election, the company's contract will probably be terminated altogether. Still, EAI chairman and CEO John Golle downplays the trouble. "The press is making this out as Waterloo," he says. "I don't think so at all. School reform is a freight train moving down the track."

There is no doubt that school reform is necessary, but EAI's brand of change makes some educators and parents explode with words like "imbeciles" and "swindlers." "They talk the talk in terms of education, but their delivery is always short," says Leo Canty, executive vice president of the Connecticut State Federation of Teachers. "EAI has come in and done so many things that have divided the community." In particular, educators express frustration with the cutbacks in special education--which the U.S. Department of Education is currently investigating at EAI schools in Baltimore--and with EAI's teaching program, called Tesseract. Named after a magical pathway in the children's classic A Wrinkle in Time, Tesseract stresses small classes and individualized lesson plans. But, says Joe Nathan, director of the Center for School Change at the University of Minnesota's Humphrey Institute of Public Affairs, who turned down a chance to sit on EAI's board, "I'm not convinced they know a good deal about how to improve what happens between teachers and kids, and that's pretty basic." A common complaint is Tesseract's reliance on computer drills. "They are using technology as a baby sitter rather than as a teacher or a creative tool," says Linda Buchanan, who took her two oldest children out of the EAI-run Eleanor B. Kennelly School in September. An EAI spokesperson agrees that students use the computers for drills, but insists the approach is effective.

As for test scores, Baltimore students attending a control group of non-EAI schools have shown a steady improvement in math and reading scores since 1992, while EAI school scores lagged behind not only the control group but the city as a whole. EAI officials, using a different yardstick, dispute these figures and note that it will take some time for scores to show improvement.

Golle says many of the criticisms are the inevitable backlash from unions and city government. "There are a whole bunch of people who like it just the way it is and would prefer that people believe that we've not been successful--when in fact we have." And it is true that some officials would like to continue the EAI experiment. Baltimore schools superintendent Walter Amprey says the company has cleaned up some of the schools, maintained appropriate class sizes and promoted healthy competition to provide better school services.

Diane Ravitch, senior research scholar at New York University, who was an Assistant Secretary of Education under George Bush, is worried that these temporary setbacks will sour people on the idea of contracting private companies to run public schools. In fact, says Ravitch, schools need "an arsenal of approaches" to blast away at the public education crisis, including magnet and charter schools. "You can't tell kids in poor schools to hang on and five years from now the school will turn around," says Ravitch. "Their time is now."

--Reported by Marc Hequet/Minneapolis and Ann M. Simmons/Baltimore and Hartford

With reporting by MARC HEQUET/MINNEAPOLIS AND ANN M. SIMMONS/BALTIMORE AND HARTFORD