Millions of Dollars Made From Teacher Evaluation Programs

Companies and nonprofits are making millions out of teacher effectiveness evaluations, sparking worries about quality of service.

As more than half of states have changed, or are in the process of changing, their laws to factor student test scores into teacher evaluations, a movement to overhaul the teaching profession is creating a new source of revenue for those in the business of education as ed reforms often translate into big money for private groups, writes Sarah Garland at the Hechinger Report.

One early outcome of recent legislation that aims to help identify teacher quality is a booming new market services and products to help states and school districts scrambling to meet the new legal requirements.

“It’s an incredibly heavy lift for states,” says Sandi Jacobs, vice president of the National Council on Teacher Quality, a Washington, D.C.-based advocacy group. “Some have contracted out big pieces of it, whether it’s someone internal in the state or an outside provider.”

Nonprofit groups and for-profit companies alike are going after public contracts to design evaluations, train teachers and principals in how to use them, and set up online platforms to help sort all of the new data that schools will be collecting, writes Garland.

“Private foundation money is subsidizing some of the contracts, but districts are also spending millions of public dollars, much of it from the Obama administration’s $4.3 billion “Race to the Top” initiative.”

This summer, New York also signed a contract with the American Institutes for Research to design its value-added system, for $2.7 million over three years, according to the state. The state is requiring school districts to hire state-approved contractors to design their observation rubrics, which schools may pay as much as $4,500 per day for training in how to use them.

According to a 2009 Government Accountability Office report, under No Child Left Behind, states spent more than $600 million annually on standardized tests, with the vast majority of the money going to the private sector.

Now, states say they are relying more on work by teachers, unions, school board members, principals and even parents as they design new teacher evaluations, writes Garland.

Nonprofits like the National Institute for Excellence in Teaching are offering their technical expertise to states.

As is Mathematica, a research group that was paid more than $500,000 to design the value-added model for the Washington, D.C. public schools. Despite, in 2010, publishing a study warning about the use of value-added modeling in high-stakes decisions because of high error rates, according to a DCPS spokesman.

Some observers worry that the fiscal crisis battering school districts could encourage administrators to seek out lower-quality products.

“There are real dangers,” said Monty Neill, director of FairTest, a group critical of standardized testing. “While observations make good sense, if you start bringing in outside people… you’re more likely to end up with arbitrary and capricious decisions from which someone makes money.”

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