[Congressional Record Volume 140, Number 8 (Thursday, February 3, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 3, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                    GOALS 2000: EDUCATE AMERICA ACT

  The Senate continued with the consideration of the bill.
  Mr. SPECTER addressed the Chair.
  The PRESIDING OFFICER. The Senator from Pennsylvania


                           amendment no. 1384

(Purpose: To encourage local educational agencies and schools to enter 
 into a contract with a private management organization for the reform 
                              of schools)

  Mr. SPECTER. Mr. President, I send an amendment to the desk and ask 
for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Pennsylvania [Mr. Specter], for himself 
     and Mr. Dole, proposes as amendment number 1384.

  Mr. SPECTER. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 66, line 23, strike ``; and'' and insert a 
     semicolon.
       On page 67, line 2, strike the period and insert ``; and''.
       On page 67, between lines 2 and 3, insert the following:
       (15) quality education management services are being 
     utilized by local educational agencies and schools through 
     contractual agreements between local educational agencies or 
     schools and such businesses.
       On page 90, line 10, strike ``and''.
       On page 90, between lines 10 and 11, insert the following:
       (I) supporting activities relating to the planning of, 
     start-up costs associated with, and evaluation of, projects 
     under which local educational agencies or schools contract 
     with private management organizations to reform a school;
       On page 90, line 11, strike ``(I)'' and insert ``(J)''.
  Mr. SPECTER. Mr. President, in consultation with the managers of the 
bill, I had arranged to submit this amendment next and will not take a 
great deal of the Senate's time because it has been agreed to by both 
managers. I consider this to be a very important amendment, Mr. 
President. I am sure all my colleagues will want to hear the details of 
this amendment.
  This amendment provides for the private administration of public 
schools. It may turn out to be a very important experiment which could 
materially improve the educational system in the United States.
  More accurately, and with some elaboration, it provides that funding 
under this bill may be allocated by local school boards, at their own 
discretion, to hire private management organizations to administer the 
operation of their schools.
  This is an idea which has been gaining currency in the United States 
with a company known as Education Alternatives, Inc., which has 
established contracts for the private administration of schools in 
Baltimore, MD, Minnesota, Arizona, and Florida.
  The activities of Education Alternatives, Inc., in some 9 schools in 
the city of Baltimore is most impressive. The Appropriations 
Subcommittee on Labor, Health, and Human Services and Education, held a 
hearing on January 25 and heard extensive testimony on this subject. 
Those offering testimony at the hearing included the superintendent of 
schools for the city of Baltimore, Mr. Walter G. Amprey, and the chief 
executive officer of Education Alternatives, Inc. Mr. John T. Golle, 
who testified about their experience with the nine Baltimore schools. 
On the surface, this testimony was very impressive.
  On a dissenting note, Ms. Bella Rosenberg, assistant to the president 
of the American Federation of Teachers, did offer a challenge to this 
testimony calling for an objective evaluation of what has happened in 
the Baltimore schools. However, based on the testimony of the 
superintendent of schools and the chief executive officer of Education 
Alternatives, Inc., the early results have shown substantial promise.
  An important thing to note on this amendment is the fact that it is 
not mandated, it is not Federal policy. Instead, it is only an 
alternative which the school administrators may consider when they 
receive funding under this legislation.
  Mr. President, the issue of public administration received quite a 
boost, at least publicly, when the president of Yale University, Dr. 
Benno C. Schmidt, left that prestigious position to take a position 
with the Edison Project. When I noticed that Benno Schmidt had 
undertaken this type of activity, I sought a meeting with him, and 
after some considerable discussion was very much impressed with the 
undertaking.
  When I first heard about administration of public schools for profit, 
it, frankly, was somewhat surprising, and very unusual. But after 
careful consideration, it seemed to me that if the private 
administration of public schools could attract people of the caliber of 
Benno Schmidt, and we could have the advantage of his insights, his 
initiative, and his experience, it was certainly an idea worth 
pursuing.
  In addition to Dr. Schmidt, Mr. Golle, Mr. Amprey, and Ms. Rosenberg, 
we also heard testimony from the superintendent of the schools of 
Washington, DC, Dr. Franklin L. Smith, who testified about the deep 
interest of Washington, DC officials in experimenting with this 
program.
  We also heard testimony from Mrs. Patricia Parham, with experience in 
Dade County schools in Miami, FL, from Mr. Dennis Doyle of the Hudson 
Institute, who testified that it was a matter worth experimenting, and 
from Mr. Thomas Payzant, Assistant Secretary for the Department of 
Education.
  The bulk of their testimony was to the effect that private management 
is something which should be looked at closely.
  That, Mr. President, is the essence of the amendment. We will, 
however, have to have further tests, in greater detail, to see 
precisely how it is working. But with this bill in the Senate it seemed 
to me this was a good opportunity to include private management as an 
alternative which school boards may explore with the funding provided 
in this bill. It is for those reasons I have offered the amendment and 
have sought the agreement of the managers of the bill.
  Mr. President, I believe that widespread public concern about the 
inadequacy of our education system demands that we test any and all 
promising avenues for school reform. The challenge is to find new and 
better ways to teach our Nation's 43 million schoolchildren. This takes 
new and innovative ideas. It also means finding new approaches to free 
up teachers and school administrators from noninstructional 
duties, allowing them to devote more time and resources to the task of 
educating our children. As a member of the U.S. Senate subcommittee 
that last year appropriated more than $28.7 billion for education 
programs, I take this challenge seriously. That is why I recently 
called a Senate hearing to learn more about an idea now being tested by 
a handful of school districts--contracting with private firms to manage 
some facets of public school education.
  The past few years have seen the emergency of a number of private 
firms offering to assume certain aspects of school operations, 
including day-to-day administration, teacher training, and other 
noninstructional activities. Typically, these companies will manage the 
school for the same average cost, about $5,900 per pupil, incurred by 
public schools. Initially, the companies invest their own capital in 
securing and upgrading the learning environment by repairing and 
modernizing the school building, and installing state-of-the-art 
computers. After that initial investment, the onus is on the companies 
to reduce school operating costs while maintaining quality educational 
results. A portion of the money saved through management efficiencies 
is reinvested in the school. Since the remaining allocation is profit 
to the management firm and there is a presence of competing firms, the 
incentive for accountability is likely to be greater than that of our 
present system of monopoly.
  Among those at the hearing were school superintendents, union 
representatives, education policy experts, and the heads of two private 
management firms. Each lent his or her own unique perspective on the 
idea.
  Former Yale President Benno Schmidt explained the Edison Project's 
school design which calls for a longer schoolday and year, a student 
teacher ratio of 17 to 1, and innovative teaching ideas to foster long-
term sustainable relationships between teachers and students, and 
teachers and parents, by having students taught by the same teacher for 
a period of 3 to 4 years. But Mr. Schmidt also talked of strict 
accountability--accountability that is different from the current 
school systems and that is--if the private firms fail to deliver and do 
not improve educational services to students, then they will be fired.
  John D. Golle, CEO of Education Alternatives, Inc. [EAI], the firm 
currently managing schools in Maryland, Minnesota, Arizona, and 
Florida, told the committee that companies like his aim to do for 
public schools what Federal Express and the United Parcel Service did 
for the U.S. Postal Service--they introduced competition, and made mail 
service in the United States the best in the world.
  In Baltimore, where nine schools are being run by EAI, preliminary 
results are encouraging. Student test scores are beginning to show 
improvement, absenteeism is on the decline, and school facilities are 
gradually being transformed. Baltimore City Superintendent Dr. Walter 
Amprey reported seeing an increased level of parental involvement and 
greater interest in computerized instruction. Perhaps most importantly, 
Dr. Amprey views the link between public education and business as a 
way to untie the hands of educators and at the same time instill 
accountability in our education system.

  D.C. School Superintendent Franklin Smith, also testified concerning 
preliminary plans to turn over a portion of the District's schools to a 
private firm. Smith views private firms as a way of avoiding the slow-
moving school bureaucracy and quickly pumping money into schools for 
facility improvements.
  Bella Rosenberg, assistant to the president of the American 
Federation of Teachers told the committee that the AFT has been 
``willing to entertain any idea, within the bounds of mortality, to 
reinvent our public schools and to make them first and foremost more 
effective and more efficient.'' She also stated that the federation was 
not opposed in principle to a role for private management companies in 
public education. However, she expressed reservations regarding the 
results these management companies could produce in education in terms 
of effectiveness or efficiency.
  When I first thought of the concept of schools for profit, I found it 
different, if not disquieting. And then, after careful consideration, I 
said, ``Why not?'' I think we ought to be looking at every alternative 
we can find, which offers any prospect for improving our educational 
system in this country.
  I am not the only one considering this alternative. During his State 
of the Union Address, President Clinton endorsed the idea of private 
school management companies when discussing the Goals 2000 legislation. 
He talked of ``empowering individual school districts to experiment 
with ideas like chartering their schools to be run by private 
corporations.''
  Accordingly, I am offering an amendment to the pending legislation to 
ensure that private management companies will have an opportunity to 
form partnerships with public schools and give school administrators an 
option thought he use of funds awarded to them by the Federal 
Government. My amendment would not require, but allow funds under this 
legislation to be used to support activities for planning, startup 
costs, and evaluations for school systems that wish to contract with 
private management companies.
  Although this amendment addresses only one possible method of 
reforming our schools, I believe that it merits a thorough review 
process. I urge my colleagues to support this amendment to ensure the 
most efficient and accountable educational system for today's students, 
and to provide the next generation with the most promising 
opportunities to learn.
  The PRESIDING OFFICER. Is there further debate?
  Mr. KENNEDY. Mr. President, just very briefly, we urge the Senate to 
accept this amendment. It is supported by the administration. I believe 
there was this kind of flexibility in the legislation initially. This 
makes it more explicit, and we support the amendment.
  Mr. JEFFORDS. Mr. President, I also want to join in commending the 
Senator for his amendment, and I know of no objection on this side. I 
think it is an excellent addition to the bill.
  The PRESIDING OFFICER. If there is no further debate--
  Mr. SPECTER. Mr. President, I ask unanimous consent that Senator Dole 
be listed as an original cosponsor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SPECTER. One further comment is in order, Mr. President. That is 
that a commendatory reference was included in the President's State of 
the Union speech, as Senator Kennedy has stated. There is support by 
the administration, by the President himself in that speech.
  The PRESIDING OFFICER. If there is no further debate, the question is 
on agreeing to the amendment offered by the Senator from Pennsylvania.
  The amendment (No. 1384) was agreed to.
  Mr. SPECTER. Mr. President, I move to reconsider the vote.
  Mr. DODD. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Mr. President, I ask unanimous consent that I be allowed to 
proceed as if in morning business for 3 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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