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Tutoring becomes a hot commodity

No Child Left Behind has opened up a potential $2 billion bonanza for companies tutoring students in troubled schools.

Note that one of the entrepreneurs says that "We're pretty well poised to capitalize on [the market], and I say capitalize, but I mean helping kids." Indeed. Tutoring companies are not held accountabile. No guarantees from private, for-profit companies. Only schools are required to furnish guarantees.



Russ Miller, a tutoring company executive, says he is pretty excited about the business these days. It's not hard to be when he sees a potential $2 billion market up for grabs.

No Child Left Behind, the federal law enacted to improve the quality of public schools, has given private tutoring companies a potentially huge new source of income by requiring some troubled schools to contract with tutors for low-income, low-performing students, using money set aside for poor schools.

Industry revenues from NCLB-mandated services more than doubled this past school year from 2003-2004 and are expected to grow by at least 20 percent this year. At Baltimore-based Educate Inc., one of the largest for-profit tutoring companies, revenue from work with troubled schools jumped 402 percent in 2004 - to $27.6 million from $5.5 million.

"We're pretty excited about that from a business perspective," said Miller, vice president of business development for Huntington Learning Centers Inc., based in Oradell, N.J. "We're pretty well poised to capitalize on [the market], and I say capitalize, but I mean helping kids."

But the anticipated annual market of $2 billion has been only about one-eighth that much, mostly because thousands of students eligible for free tutoring are not signing up, according to Eduventures, a Boston-based education information company.

Mark Jackson, director of kindergarten through 12th grade research at Eduventures, said a high estimate of the number of eligible students receiving services is about 200,000, or 12 percent.

"What's going on in the industry is there are companies who are very eager to enroll students, more eager than students are to enroll in the programs," Jackson said. "The challenge is even with the funding available, ... parents have to say, 'Yes, I want my child to take advantage of this opportunity.'"

Tutoring companies see the NCLB market as a way to give low-income students the advantages they've offered for years to middle-class children needing extra help in school or to students from affluent families trying to boost their test scores to get into top colleges or secondary schools.

"This is not a get-rich-quick program," said Steve Pines, executive director of the Education Industry Association, a trade group for education companies. "It's wonderful that high- quality tutoring companies have their services available to kids who normally could never afford it. It's great."

But some educators are critical of the program because tutoring providers, unlike schools and teachers, are not accountable under the law for the students being able to pass standardized tests. The providers say they ensure that most students will at least make some improvement - which they maintain is better than nothing.

No Child Left Behind, enacted in 2002, mandates that nearly all children in public schools reach proficiency in reading and math. The law requires annual testing that determines how much students, individual schools and school districts have improved year over year.

Schools that do not meet standards for two years in a row are placed in the "school improvement" category, which means parents can transfer their kids to a better-performing school or schools must offer free tutoring for students.

Tutoring lists

Parents choose a tutor from lists compiled by the states. Approved tutoring providers can range from schools, to nonprofit groups and faith-based organizations, to small startup businesses and nationwide, for-profit companies such as Catapult Learning, a division of Educate Inc., and Huntington. Maryland's list of approved tutors includes more than three dozen providers who offer small group, one-on-one or online services.

Companies don't receive a set price for the tutoring services; the federal government provides $900 to $2,500 a year per student, depending on the state and school district, Pines said.

Providers then determine the length and frequency of tutoring sessions based on students' needs and the money available. Huntington, which normally charges about $40 an hour for retail tutoring, often receives a similar rate for its NCLB services, Miller said.

In the three years since the program started, providers and schools have been figuring out how to set up the services, Pines said. In some parts of the country, parents don't sign up their children for the tutoring programs because tutors are too far away or because kids have other after-school activities.

Maryland has a different problem: The state has funding for only about 12,000 of the 30,500 students who are eligible for tutoring services - and only 6,000 are using it, said Ann Chafin, chief of program improvement for the Maryland State Department of Education. In Baltimore, where a high number of schools fail to meet the No Child Left Behind standards, some children were denied free tutoring because of high demand and not enough supply.

Educate Inc., which also operates Sylvan Learning Centers, started Catapult Learning, its vendor-to-school division, about a decade ago, years before the federal government made such services mandatory, said Jeffrey Cohen, Catapult's chief executive. School districts have used federal money for Catapult programs over the years.

Now, parents of eligible students can choose among a variety of providers selected by each state, which has given tutoring companies access to customers they would have served, Cohen said.

The issue is reaching out to them. Some providers use direct advertising, school promotions, name recognition or word of mouth.

"It's the obligation of the providers as well as the schools to work together," Miller said. "The money's not being spent because we need to communicate better with parents."

Some experts said school districts have not done a good job of promoting programs or increasing parental awareness of the services.

"We're seeing an accelerated growth, but we are causing that because we are aggressive," said Miller.

Chafin said her office has tried to help school districts market the services better, for example, by altering the language of letters sent to parents from phrases like "In pursuant of NCLB regulations ... " to "Good news! Your child qualifies for free tutoring."

"Why would we not try to make this work for our children?" she said. "It's not a punishment. It's an opportunity."

Gloria Maddox signed up two of her grandchildren after hearing about the program at back-to-school night at Rognel Heights Elementary and Middle School in Baltimore last fall. She remembers educators emphasizing the free part.

"All you had to do was sign up," she said. The money part is important to her. "I've talked to other parents who have to pay, so yes," it makes a difference.

One of her grandchildren, Bria Gordon, 8, has always had trouble in math.

"I felt like I was the only one who didn't know math," said Bria, who will be a fourth-grader next fall. "Every time I would try to sit there and work it out, everybody's hands would fly in the air."

Bria's twice-weekly, 1 1/2 -hour sessions gave her a chance to ask questions and work slowly. She said she started to understand math and her grades got better. "The teachers had the time to help me figure out the math problems," she said.

Under NCLB, school districts are in charge of monitoring how much progress is made by students like Bria.

But there are few, if any, requirements of what the tutoring firms must produce in terms of student achievement. Most tutoring companies tell parents to expect some form of improvement but won't guarantee that a child will achieve a particular score on a standardized test.

Educate, for example, says children can jump one grade level in a particular subject after 36 hours of instruction. Huntington boasts of being able to help a child improve by two grades after 12 weeks or 40 hours of instruction.

"Our promise is not a guarantee," Miller said. "We promise that they will improve, but how much depends on their skill level when they come in."

That troubles Penelope Earley, professor and director of center for education policy at George Mason University in Fairfax, Va.

"There's no accountability other than the marketplace," Earley said. "It is quite ironic and quite paradoxical that the accountability standards that are imposed on teachers, on schools and on districts are not imposed on the tutoring firms in the same manner."

Chafin, of the Maryland State Department of Education, said educators don't expect tutors to usurp their role in educating students or that tutors alone can do the job.

"We should be giving [children who are behind] more than what they are getting in their regular classroom to make up for the deficit," she said. "The challenge is to keep track of assessments."

Tutoring providers assess pupils when they sign up, and periodically to track their progress. Those assessments are often based on the providers' materials or curriculum - not the school district's. Some students might show improvement, but still not be able to reach the proficient level on state tests.

"I don't think the expectations are that we are going to take a whole school and bring them up to standards in 10 to 12 weeks," Miller said. "We're not magicians, we're educators." He said many students are behind and continue to fall behind, so just stopping a child from regressing is progress.

Many school districts do not have the resources to properly monitor tutoring services, said Jack Jennings of the Center on Education Policy, a think tank in Washington.

"With companies seeing all the money they can make, there is a possibility of a great deal of abuse," he said.

Some abuses

Some abuses have occurred in places like Las Vegas, where students were registered for services by more than one provider, but only received services from one, according to a report by the policy center. Another example from the report showed that parents who selected online services were forced to pay for hidden costs such as a computer or Internet access.

While acknowledging some abuses, for-profit providers say they have to keep consumers - in this case school districts, parents and students - happy as any other business must.

"We're directly accountable to the schools and from a fiduciary standpoint, also to our shareholders," Cohen said. "The way we grow our business is by providing good educational services. It's a mission of scale. The idea is to reach as many students and school districts as we can."

The idea of No Child Left Behind is to bring every student and school up to a level where, presumably, the need for tutoring would disappear.

Cohen said that will probably not happen, making Catapult's business model sustainable for decades to come. "Unfortunately, we face a situation today where there are so many schools in distress and students in need," he said. "I don't foresee that need going away."

— Blanca Torres
Baltimore Sun
2005-07-24
http://www.baltimoresun.com/business/bal-bz.tutoring24jul24,1,4938363.story?coll=bal-business-headlines


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