Yesterday the School Reform Commission terminated contracts for six education management organizations (EMOs), and put another 20 on one-year probation with plans to closely scrutinize how money is spent. The District formerly had 38 schools in a “multiple” provider model with for-profit companies, non-profits and universities in the mix.

Edison Schools, Inc., the largest provider with 20 schools, lost 25% (four) of its contracts, and saw another twelve put on probation. Temple University lost one contract at Dunbar Elementary; and Victory Schools lost its contract with the all-boys school Fitzsimons.

Interestingly (or predictably), local providers Foundations Inc. and Universal Companies lost no contracts, although Foundations saw three of four of its schools placed on probation. Universal has one of its two contracts also on probation.

Only 12 schools, less than a third of the EMOs, received a multiple year contract from the District.

Although at first glance, the effort is a modest one, it’s potentially a blow to the privatization movement nationally and marks a rethinking of the role of EMOs in Philadelphia under the administration of new CEO Arlene Ackerman. More important, it should highlight the work of grassroots parent and student groups, like the Philadelphia Student Union and Parents United for Public Education, who have kept this issue on the front burner as a question of quality school choice vs. multiple school choice.

In 2001, EMOs came to Philadelphia as a condition of the state takeover of the public schools. A previous state takeover in Chester the year before had esconced Edison Schools Inc., the largest private manager of public schools nationwide, in nine out of ten Chester schools.

Initially, Edison Schools had a deal to manage the entire Philadelphia school system, news that sparked international interest and fired up a grassroots movement led mostly by students and unions as well as citizens. Hundreds of people took to the streets, walked out of schools, and blocked schools and the administration building; in the end, only one-sixth of the public schools were turned over to EMOs. Edison Schools, once a darling of Wall Street, was brought down to pennies a share and eventually went private – bought out, by the way, by the Florida Teachers Union as a pension investment.

Since then, the EMO “experiment” in Philadelphia has read as a case study of what has gone wrong with EMOs nationally: exorbitant management fees, lack of accountability, sweetheart contracts, non-enrollment based funds, concerns about adequate delivery of services to special needs students and English language learners, political intervention, etc. Four out of five studies of EMOs in Philadelphia showed that they did no better academically than the average district-managed school, despite five years and more than $107 million in management fees.

Parents United contrasted the financial burden of EMOs (between $18-25 million annually) as well as their academic failures, with the decline in classroom resources and rising class sizes across the district.

Nationally, we’ll have to look to see whether this action has an impact on privatization. Philadelphia is Edison Schools Inc.’s largest contract. To have two-thirds of Edison Schools either terminated or on watch is a major blow to a company that has consistently lost contracts around the nation.

Second, we hope that this is a positive move by Dr. Arlene Ackerman, who came in promising to "hold adults accountable." In a challenging political environment, Ackerman made a gutsy move to establish herself in the take-charge role, to demand accountability, and send a strong message that poor contracts need to go. EMOs are the most potent symbol of why contracts drain the district, but they are only one small piece of many contracts that warrant scrutiny and public accountability.

Read today's Inquirer story.
Read Nijmie Dzurinko’s excellent post on Philly Student Union’s statement on EMOs.
Read Parents United’s statement on the EMO decision.