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N.M. Ruling Rejects Protest of Pearson's Common-Core Testing Contract

By guest blogger Sean Cavanagh. Cross-posted from Marketplace K-12.

The state purchasing office in New Mexico has rejected a closely watched protest of a potentially enormous contract for common-core testing to Pearson, ruling that the bidding process was structured in a "careful and thoughtful" way, despite a rival organization's claims.

The decision by New Mexico State Purchasing Agent Lawrence O. Maxwell is a defeat for the American Institutes for Research, a Washington-based organization that argued that the bidding process was skewed to favor Pearson.

And it marks a victory for the Partnership for Assessment of Readiness for College and Careers, one of two main consortia of states creating online tests aligned with the common-core. The dispute had created doubts about whether PARCC could stick to its schedule for giving online tests in states around the country by the 2014-15 school year.

Unless the decision is appealed by the AIR, the ruling would appear to clear the way for Pearson to move forward with administering a wide variety of test development and administrative work for PARCC.

Jon Cohen, president of the AIR's assessment division, told Education Week that his organization had not yet decided whether to appeal the decision.

The state of New Mexico had issued the disputed request for proposals on behalf of PARCC states. While consortium officials have not put forward an official estimate of the value of the Pearson contract, one PARCC state official recently described its size as "unprecedented in scale."

Hanna Skandera, the state schools chief in New Mexico, a PARCC state, said she was confident the bidding process had given all parties a fair shot.

"We all know how important this is to the students in our states," she said in an interview. "It's great news, it's resolution, and on behalf of our kids, we're going forward."

Mitchell Chester, commissioner of elementary and secondary education in Massachusetts, another PARCC state, said in a statement the ruling "allows us to get back to the work started by states and strengthened by thousands of teachers—developing a new generation of high-quality assessments."

In filings with the state, the AIR has said that the contract value for the work of simply administering the tests, on its own, could be huge—as much as $900 million over four years.

State Power Cited

The AIR had made a number of arguments in the case that took issue with the awarding of the contract to Pearson, a global, commercial provider of testing and other education services.

Among them: that the RFP was a "cooperative procurement," yet was not constructed as such in accordance with state law.

But Maxwell, in his written decision, said the award to Pearson was never a cooperative procurement, but instead was a "statewide price agreement" that could be used not just by New Mexico officials but by any other state that wanted to take advantage of the deal in keeping with their own states' laws. 

The AIR's protest, "fails to demonstrate any harm to the vendor, or to the interests of the state," Maxwell wrote.

Maxwell also disagreed with the AIR's argument that the structure of the bidding process unfairly favored Pearson, by improperly bundling services that would give the testing company an advantage. Maxwell said the state of New Mexico had broad discretion under the law to structure the bidding in a way that "best suits [its] business needs."

The state had "principled reasons" for placing various testing components in the same RFP, Maxwell added, and state officials had found that separating the contract out into various pieces would have been impractical.

"[A]n agency has the discretion to determine its best course for a solicitation that will fulfill its requirements," Maxwell wrote. "No vendor, including AIR, has any right to substitute its own views and business policy decisions for any state agency."

The AIR initially filed a protest over the RFP released by New Mexico in December. A core argument by AIR was that the request for bids wrongly tied testing services to be provided in the first year of the exams with work in subsequent years. That bundling favored Pearson, because it would rely on a content/delivery platform already developed by Pearson for the PARCC tests, the AIR argued.

Maxwell rejected the AIR's initial protest, saying it had not been filed in time. But a state judge disagreed, issuing an order in May that the state purchasing official had to review the merits of the AIR's complaint—a review that ultimately led to this week's ruling.

Laura Slover PARCC's CEO, said with the New Mexico decision, individual states in the consortium will be free to use the New Mexico pricing agreement to enter into their own contracts with Pearson, in accordance with their state laws.

Cohen said that AIR officials will discuss whether to appeal the decision in the coming week. Under state law, an appeal would have to go through New Mexico's court system.

The New Mexico purchasing office's decision "was not unexpected" and was "not well-reasoned," he argued.

Given PARCC's intention to deliver online tests in 2014-15, if the AIR were to ask the courts to block the contract from going forward, it would risk putting the consortium "in a position not to deliver the test next year," Cohen said, which was not the AIR's intention.

"It's in the country's interest for PARCC to survive and be healthy," Cohen said. Even though the AIR remains convinced that the bidding process for the tests was unfair,  he added, "We don't want to derail the PARCC consortium."

Cohen noted that AIR was not arguing that the entire contract with Pearson needed to be thrown out. Instead, the AIR was willing to see the award for the first year or two of the work given to Pearson, as long as later years were separated out and re-bid through a fair process.

He said that AIR had approached PARCC officials, through an "intermediary," who he declined to identify, about reaching that resolution, but a deal was not worked out.

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