69ý

Assessment

States Writing Penalty Clauses Into Testing Contracts

By Lynn Olson — November 30, 2004 4 min read
  • Save to favorites
  • Print
Email Copy URL

With so much now riding on student test results, states are introducing stiff penalties and other provisions into assessment contracts to provide an incentive for publishers to deliver results on time and error-free.

See Also

“Statewide testing programs are much more visible to the public, and so I would say there is a heightened sensitivity to any glitches,” said Jeff Galt, the president and chief executive officer of the San Antonio-based Harcourt Assessment. “Where there used to be some collegiality, or an understanding that it’s still a process dependent on human beings, subject to mistakes, there’s very little tolerance for that.”

Hawaii, for example, is negotiating a partial reimbursement from Harcourt for errors in the state’s spring 2004 state testing materials. The company reviewed test scores last summer, to ensure that none of the mistakes in the test booklets or administration manuals would harm students or schools. And it has worked out new quality-control processes with the state to ensure that the problem won’t happen again.

“There’s no question: The biggest change we see is the terms and conditions,” said Stuart R. Kahl, the president of the Dover, N.H.-based Measured Progress. “They include penalties and damages and also requests, in some cases, for performance bonds. A performance bond is almost like an insurance policy, where you name the state as the beneficiary.”

It’s a real problem for small companies without deep pockets, he added, that cannot always carry such liability costs.

Providing Incentives

Georgia is a case in point. The state had experienced numerous problems with the timely delivery of test results, scoring errors, and the inadvertent release of secure test items dating back to 2001 and spanning contracts with several test publishers. (“Ga. Suspends Testing Plans in Key Grades,” April 16, 2003.)

Since the spring of 2003, however, the state has taken aggressive steps to address the issue.

Kathy B. Cox

“I had to realize that part of the problem was here,” said Kathy B. Cox, Georgia’s state superintendent of education. “It wasn’t just the contractors. Part of the problem was the maintenance of the contract, and the oversight of the contract with the contractors, and the mixed messages that contractors had gotten.”

Ms. Cox has reorganized the testing division within the state education department, including paying more to attract well-qualified people. Georgia has staggered its requests for proposals, so that the testing and legal divisions are not forced to negotiate several contracts simultaneously, each worth tens of millions of dollars.

Its new contractor for standards-based tests in grades 1-8, Riverside Publishing, faces heavy penalties for potential failures, ranging from the late delivery of test results to the administration of an invalid exam. The penalties, starting at $5,000 a day, top out at 30 percent of the overall value of the contract.

The state department of administrative services also requires companies to post a performance bond for any contract in excess of $100,000. The insurance basically guarantees that, in case of a breach of contract, the state can recoup its costs.

Georgia’s contract with the Itasca, Ill.-based Riverside, a division of the Boston-based Houghton Mifflin Co., also establishes a payment schedule, in which more than half the fees are paid upon the receipt of essential services, such as getting the testing blueprints on time or a smooth administration of the exams.

“If they fail to meet these key delivery dates,” said Ms. Cox, “at any point along the way, we have the option of not paying them, and that was not real clear in the other contracts.

“So we’ve really increased the incentives for these companies to meet their deadlines, and that was a huge problem before,” she added. “They didn’t have an incentive.”

‘Too Risky’

Other states, such as Michigan, have reduced the number of penalty clauses in their contracts but made the ones they have heftier for failure to meet crucial deadlines.

“The states have either gotten burned themselves by delivery problems or errors in the past, or they’ve read about other states that have had those problems,” said John H. Oswald, the senior vice president and general manager for elementary and secondary education at the Princeton, N.J.-based Educational Testing Service. “And they have added some very, very strict penalties.”

“If we see a contract that looks too risky because the penalty clauses are just way out of line with the timelines,” he added, “then we’ll just pass on it, which is why we don’t bid on that many contracts.”

But David M. Taggart, the president of CTB/McGraw-Hill, based in Monterey, Calif., argued that, while some states have incorporated steep penalties into their programs, “I don’t see it as a trend.”

“I think most state departments recognize this is a collaborative effort,” he said, “that there are a lot of things that can happen outside our control.”

And although state requests for proposals have become more sophisticated, Mr. Taggart said, there’s still a wide range.

Eduventures, a Boston-based firm that tracks education-related businesses, also predicts that with the increased stakes attached to state assessment results, states will begin to pay more attention to such issues as provider qualifications and experience, and not just award contracts to the lowest bidder. The freedom to do so varies across states.

A version of this article appeared in the December 01, 2004 edition of Education Week as States Writing Penalty Clauses Into Testing Contracts

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Artificial Intelligence Webinar
AI and Educational Leadership: Driving Innovation and Equity
Discover how to leverage AI to transform teaching, leadership, and administration. Network with experts and learn practical strategies.
Content provided by 
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
School Climate & Safety Webinar
Investing in Success: Leading a Culture of Safety and Support
Content provided by 
Assessment K-12 Essentials Forum Making Competency-Based Learning a Reality
Join this free virtual event to hear from educators and experts working to implement competency-based education.

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.

Read Next

Assessment Opinion 'Academic Rigor Is in Decline.' A College Professor Reflects on AP Scores
The College Board’s new tack on AP scoring means fewer students are prepared for college.
4 min read
The United States Capitol building as a bookcase filled with red, white, and blue policy books in a Washington DC landscape.
Luca D'Urbino for Education Week
Assessment Opinion 69ý Shouldn't Have to Pass a State Test to Graduate High School
There are better ways than high-stakes tests to think about whether students are prepared for their next step, writes a former high school teacher.
Alex Green
4 min read
Reaching hands from The Creation of Adam of Michelangelo illustration representing the creation or origins of of high stakes testing.
Frances Coch/iStock + Education Week
Assessment Opinion Why Are Advanced Placement Scores Suddenly So High?
In 2024, nearly three-quarters of students passed the AP U.S. History exam, compared with less than half in 2022.
10 min read
Image shows a multi-tailed arrow hitting the bullseye of a target.
DigitalVision Vectors/Getty
Assessment Grades and Standardized Test Scores Aren't Matching Up. Here's Why
Researchers have found discrepancies between student grades and their scores on standardized tests such as the SAT and ACT.
5 min read
Student writing at a desk balancing on a scale. Weighing test scores against grades.
Vanessa Solis/Education Week + Getty Images