Category Archives: Business

The SAT: Old Market Forces are New Again

An Eastern Grey Squirrel, holding an acorn.

An Eastern Grey Squirrel, holding an acorn. Photo by DAVID ILIFF. License: CC-BY-SA 3.0

The College Entrance Examination Board (College Board) gave notice today that its SAT exam will undergo changes since its last revision in 2006. The changes include eliminating the test’s guessing penalty, phasing out arcane words form the verbal section and emphasizing data analysis and functions in the math section. But the most notable change is the nearly nine-year-old writing portion, which was seemingly tacked-on as an additional 800 points to the test’s original 1,600. Beginning in Spring 2016, the essay section will be made optional for test takers. While this change will probably have a positive impact on the perennial fits of anxiety experienced by many families with college-bound sons and daughters in the fall of senior year, the College Board isn’t doing it for your mental health. They’re doing it for the pocketbook. Their own press release noted that while “some [admissions officers] found the essay useful, many did not.”

So why was the essay section added to begin with? For that, we can look back to 2001 to the University of California system, which sought what it felt was a better way to evaluate its then 90,000-applicant-strong pool, each required to take the SAT I,  and depending on the potential first-year’s chosen major and campus, an additional SAT II subject test. Then-UC System president Richard Atkinson suggested eliminating the SAT, but the system later advocated for an essay portion. The College Board, along with more than a few of its member colleges, was reticent.

But with 1.07 million SAT test takers in 2001, the UC System constituted over 8.3 percent of the board’s test takers. Most accounts of the day called it the board’s largest single customer. One year later, the board announced that it would be augmenting the test with it’s essay section, thus keeping its largest customer.

That revision had mixed results. While the written test was made mandatory by UC shools and most Ivy League schools, many other schools decided to abstain from the written portion altogether. An LA Times piece reported that in 2012, SAT testing numbers were surpassed by the ACT, administered by ACT Inc, at 1.6 million and 1.7 million, respectively. Numbers for 2013 are not available for the ACT, but the Washington Post claims that it surpassed the SAT again, at 1.8 million, against the College Board’s self-reported 1.6 million. The LA Times piece also notes that the board’s cumulative changes to the SAT make it increasingly similar to the ACT.

(While I wasn’t able to find any accounts explicitly discussing cost, I suspect that a written essay would be far harder to evaluate than a multiple choice test, especially with amounts in the millions. This is something I’m attempting to confirm, and I’ll edit this to reflect any answers received. – fr[ed])

Those 1.6 million students took the SAT I included 10.5 percent of the UC System’s 174,700 applicants for Fall 2013. The UC System told the LA Times that it doesn’t know if it will require the now optional written portion, but is taking a “wait and see” approach. This sentiment is likely wide-spread, and will likely persist for some time while universities evaluate the test in light of these changes.

Also included in the press release were items pertaining to college access and ease of use. The board says that it will introduce an income-based fee waiver for up to four college applications, a move which it credits in part to its member colleges. The board will also include software-based test preparation for future test takers in a partnership with Khan Academy in order to, as the company’s president Sal Khan says, “to level the playing field by making truly world-class test-prep materials freely available to all students.”

It should be able to afford it, as the College Board collected $758 million in revenue for the fiscal year ending June 2012. In addition to the SAT, it also administers the PSAT, and testing for AP high school courses. In comparison, Act Inc. reported revenues of $302 million for its tax year ending August 2012. Khan Academy collected $15.7 million in revenue for the year ending December 2012.

Leave a Comment

Filed under Non-Profit, Normal Note

You Could Have Run Guantanamo Bay If Your Price Was Right!

Naval Base Guantanamo Bay

New Contractor, Come on Down!

On July 31, 2013, the US government began its search of the right company to run Naval Station Guantanamo Bay. Yes, this is the same Guantanamo Bay of that features two detention camps that holds 164 inmates. The larger base that these camps run in, however, has been a fixture of the US’ military presence since 1904. One missile crisis and some literal die-hard Marxism later, the base today houses around 8,500 people in various positions in military and civilian capacities, including Cuba’s first and only McDonald’s location.

And since Oct. 4, 2013, the Navy has begun sifting through bids looking for one good contractor to run the facilities that bring the base to life.

More specifically, the BOS (Base Operating Support) contract is for supplying “all labor, supervision, management, and materials, except that specified as Government furnished” to tend to “Family Housing, Facility Investment, Custodial, Pest Control, Integrated Solid Waste Management, Other (Swimming Pools), Grounds Maintenance, Transportation, Electrical, Wastewater, Water, and limited Facilities Support functions.”

According to the RFP, (or “Request for Proposal” in the contracts world) the current contract is set to expire in November 2014, and is held by a joint venture of two engineering/consulting firms under the name Bremcor JV (Joint Venture). That’s a mash-up of a company called Burns & Roe, and another named EMCOR. B&R is a private company, and its work has mostly focused on designing large-scale energy projects. They also designed an energy conservation plans for City University of New York. EMCOR is publicly traded, and brought in $1.5 billion in revenue across operations providing electrical and mechanical construction projects throughout the US and the UK.

The length of the contract appears to be for one year, with four additional one-year extensions available if the Navy likes who they’ve selected. Based on the RFP, the Bremcor JV was paid $132 million for six years of service. That’s an average of $22 million a year. This is much more expensive than the US government’s yearly lease fee paid to Cuba, agreed upon in 1937, which is just over $4,000.

Given the way government contracts are usually awarded, we won’t have an award decision for a few months at best. And if you missed this one, you still have an opportunity to place a bid for base-based data-filtering services or for keeping this, and surrounding bases fed.

Leave a Comment

Filed under Business, Community Affairs, Normal Note