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A guide for school districts that may contemplate performance contracting as a way to improve student achievement, stimulate innovation, or achieve other objectives. Its purpose is to help decisionmakers assess the planning, management, and evaluation of contracts. Legal issues, program management, and measurement of student achievement receive special attention. The guide follows a project's life-cycle through three phases: planning and contracting, operation, and evaluation. Six activities in the first phase are discussed: legal research; assessment of needs; request for proposals; proposals; selection of the contractor and any other program participants; and determination of contracts. Six operational aspects are considered: selection of schools; personnel selection; teacher training; student selection and transfers; program monitoring; and extending awareness of the program. Four activities in the evaluation phase are discussed: program validation, contract settlement, program evaluation, and the decision on the program's future. The guide neither endorses nor opposes performance contracting. (See also R-699/1, R-900/1, R-955/2.)

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