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The past decade has witnessed an unprecedented expansion of the influence of the private sector in all aspects of public education. Across the United States, test publishers, software companies, virtual charter school operators, and other industries are rapidly moving to take advantage of the significant revenues made available by public policies. As these companies garner billions of dollars in public revenues, they assume a central place in the day-to-day governance and administration of public schools; however, while drawing on public money and the authority of public policy, the work of the new privatization has been kept relatively hidden from view. Drawing on the research the author has conducted in school districts around the country that contract with private firms for functions typically performed by the district, this paper examines how developments in K-12 education contracting change the district's role in education. It pays particular attention to emerging policy issues and the policy tensions they raise. There are four central arguments presented in this paper. First, there have been important developments in school district contracting in the United States that deserve close attention from those district policymakers who work to expand educational access and participation in high poverty communities. Second, some of the Federal mandates driving the rise in contracting are designed to benefit the market rather than the interests of the public sector, and at the same time there are few safeguards to ensure equity. Third, private firms are taking on more roles within school districts, and large firms are a dominant force within this dynamic. Fourth, surveys show that power asymmetries exist between service recipients (parents) and providers because many parents have limited access to information regarding privatized services even though they are the intended beneficiaries. The author discusses these arguments in the second section on emerging policy issues. She concludes by identifying three action areas for districts interested in using contracting in order to expand access and participation in high quality programming. (Contains 3 endnotes and 1 footnote.).