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School Board Votes to Let Private Firm Manage Schools

By Mary Jordan
The Washington Post

The Minneapolis School Board has voted to turn over management of all city schools to a private consulting firm in a novel arrangement believed to be the first in the country.

Other cities, including Baltimore, have hired outside consultants to run a few schools, but Minneapolis' attempt to change school management is the most sweeping to date. Late Wednesday night, the board voted, 6 to 0 with one abstention, to hire Public Strategies Group Inc., to manage its 75 schools and $220 million budget.

Peter Hutchinson, president of the group and an expert in running public organizations, would replace the school superintendent, if the state, as expected, grants a waiver to allow a non-educator to head the school system.

"There is a feeling here in Minneapolis and all over the country that the current bureacratic system of running a school is antiquated," said Babak Armajani, chief executive officer for Public Strategies Group Inc.

The Minneapolis plan differs from other attempts to have private firms run one or more public schools because all of the city's 44,000 students would be involved and because the school board would continue to set school policy.

Under the proposal, Public Strategies is to receive a flat fee and would not earn a profit if it operates the system less expensively. In fact, Hutchinson has agreed that he should not be paid unless certain student performance goals are met.

Details of the contract, including Hutchinson's salary and what student achievement goals will have to be met, are being negotiated, Nicol said.

Minneapolis has been without a permanent head of its schools since May, when Robert Ferrara resigned after criticism of financial mismanagement.