Education Alternatives wins New York State Contract

Business Wire,  Feb 13, 1996  

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MINNEAPOLIS--(BUSINESS WIRE)--February 13, 1996--Education Alternatives Inc., the nation's largest enterprise specializing in private-public educational partnerships won its first New York state contract last night.

The Wappingers Central School District, with a $99 million annual budget and 11,000 students, outside Poughkeepsie, NY, awarded Education Alternatives a contract to develop an annual budget that cuts $5 million from next year's spending plan beginning July 1, 1996, while maintaining or improving the educational achievement of students.

The EAI proposal approved by the Wappingers Central Board of Education encompasses 8 different programs to be addressed over the next 3 months including establishment of financial controls; review of prior spending plans and compliance with state and federal regulations; consideration of privatization of non-instructional services; preparation of a zero-based, programmatic budget tied to instructional objectives; and evaluation of new program strategies to improve the quality of service and reduce costs in areas such as special education, management information systems, and staffing levels.

Education Alternatives will be paid a consulting fee of $100,000 for these initial services and has notified the Board of Education that it is eager to enter into a subsequent management contract with the district effective July 1, 1996 to implement the recommendations made in the 1996-1997 budget it is developing.

Dr. Philip E. Geiger, EAI president, will be the project leader. EAI expects the work to be completed by the end of April 1996 in time for the Board of Education to reduce taxes to local citizenry. Board president Peter Donnelly called the contract, "a wonderful beginning of what we hope to be an excellent relationship with Education Alternatives Inc. in bringing the school system's finances under control and providing additional educational resources and systems to improve the performance of Wappingers' students."

Wappingers Central School District is the first suburban school system to employ EAI since the company announced its expanded scope to include suburban school sites in addition to the urban areas it now serves in Baltimore, Maryland and Hartford, Connecticut.

Baltimore City officials are now in negotiations with EAI to continue through June 1996 the services the company brought to the City in 1992 leading to significantly improved student performances since 1993 on the Comprehensive Test of Basic Skills and the Maryland State Performance Assessment Program as well as facility and safety improvements. In addition, the Hartford, Ct. Mayor, Michael Peters, has recently recommended that EAI manage the school district's finances under City authority.

EAI will commence the contract in Wappingers Falls effective immediately upon signing the contract, which is expected later this week.

CONTACT: Wes Truesdell

Matthew Swetonic

The Dilenschneider Group

(212) 922-0900

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