For the Record: Turnarounds and no-bid contracts

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Concerns about conflicts of interest with the Academy for Urban School Leadership and CPS were raised once again in recent letters to the inspectors general of CPS and the U.S. Department of Education. But one point raised by critics has not been explored much, even though it is central to the question of potential conflicts.

“Why are these [contracts] put out on a no-bid basis?” asked Austin community activist Dwayne Truss at a Monday press conference held in front of the building that houses the regional offices of the U.S. Department of Education. “AUSL has an exclusive, no-bid contract with CPS. Competing organizations are not taken seriously.”

This year, three schools are slated to be turned around, a process that entails firing the entire staff and replacing them. AUSL, which will handle the turnarounds, is a non-profit teacher training program and receives $300,000 in upfront funding as well as an additional $420 a year per student for five years.

AUSL is awarded turnarounds through a “School Management Consulting Agreement.” Such an agreement is unique and CPS officials say they are not legally compelled to put out a Request for Proposals (nor does anything prevent them from seeking multiple proposals).

Board member Jesse Ruiz says CPS “should always critically review all of our contracts… We should always be reviewing alternatives to make sure we provide the best for children and the City of Chicago.”

No way to benefit financially 

According to district officials, AUSL’s big selling point this year was that 13 of the 16 turnarounds that the organization has managed for more than a year posted higher-than-average academic growth. Yet Valerie Leonard, another West Side activist fighting against the turnarounds, notes that many non-turnaround schools have shown similar progress.

Further, under Mayor Rahm Emanuel, the ties between CPS and AUSL have become stronger, which may be another good reason to make sure the process of awarding the contract is competitive and fair. Emanuel appointed former top AUSL officials David Vitale as board president and hired Tim Cawley as chief administrative officer.

Hood notes that Vitale and Cawley have no way to financially benefit from the contract.   

The letters also say that board member Carlos Azcoitia might have the most to gain from CPS contracting with AUSL. He is a professor at National-Louis University, a college that trains teachers working in AUSL-managed schools. However, Azcoitia recused himself from the vote to give control of the three schools to AUSL, though he did vote separately in favor of the turnaround in general.

Truss also alleges that campaign contributions from AUSL board members and their partners totaling more than $60,000 might be influencing Emanuel. AUSL has 33 board members that range from a managing director of the Boston Consulting Group to the vice president of personal wealth management at Goldman Sachs.

Not the only group

Though it seems like a given these days, AUSL was not always seen as the preferred turnaround provider.

In 2006, AUSL was one of five vendors given pre-approved status to undertake “new school models.” Three of the vendors, including AUSL, were supposed to do a mix of turnarounds and “new starts,” while two were just to do “new starts.” AUSL was supposed to have 2,000 students in the schools it managed. Today, some 19,000 are in AUSL schools.

The other vendors were charter school operators. None of them ever took over schools. CPS tried in 2008 to get charter operators to handle turnarounds. But the operators were concerned that they couldn’t be successful without the autonomy of being a charter school, and the plans never went through.

The landscape has changed since then. Under the federal School Improvement Grant program, school districts had to find outside partners to work with to improve schools. More groups stepped up and Illinois now has 13 approved vendors.

One of the vendors, Atlantic Research Partners, might be open to doing turnarounds in CPS but has never been given a chance to bid, says Atlantic’s Todd Zoellick, who works with schools elsewhere in Illinois.

CPS spokesman Joel Hood says the district would have to look carefully at other groups that purport to be able to do turnarounds, and that CPS is happy with AUSL’s results.

Though he has been impressed with AUSL’s results at Marquette Elementary, Azcoitia says he would like for CPS to develop its internal capacity to overhaul struggling schools. He notes that with budget constraints, the district’s new Office of Strategic School Support Services, known as OS4, is less expensive than contracting out the service.

OS4, Strategic Learning Initiatives

Rather than firing an entire school staff and starting from scratch, OS4 offers professional development and training for existing employees and oversees school improvement funds at these “reinvestment schools.” It also oversees the implementation of the federal School Improvement Grant program.

Another alternative is Strategic Learning Initiatives, which also works with existing teachers and staff. SLI’s model costs less than $200,000 per year and includes a school leadership team and on-site coaching for teachers and principals.

Last week, parents, faculty and community members from four schools slated for turnaround assembled at AUSL headquarters to ask CPS to approve the SLI School Transformation Process instead. Faculties at Barton, Carter, Dewey and Louis elementary schools have voted overwhelmingly to use SLI instead.

“CPS has already invested in a transformation plan developed by Strategic Learning Initiatives,” said Jesse Sharkey, vice president of the Chicago Teachers Union, in a press release. “It is highly effective, already proven in CPS schools, and can save an enormous amount of money. We urge CPS to embrace this option.”

John Simmons, president of SLI, says his group wants to work with CPS but would resist doing turnarounds in which the entire staff are to be replaced. Turnarounds are “not a cost effective model for transforming a whole set of schools,” Simmons says.

He notes that across the country few school districts are using the turnaround model and instead are now pursuing the less-drastic transformation model, bringing in outside partners to help a school improve.