FILE PHOTO: News Corp. chief Rupert Murdoch in Manhattan. (July...

FILE PHOTO: News Corp. chief Rupert Murdoch in Manhattan. (July 22, 2011) Credit: AP

The heads of the statewide teachers' union and its New York City affiliate are urging the New York State Education Department to reject a $27-million no-bid contract with an educational firm owned by News Corp., citing privacy concerns, a lack of transparency surrounding the contract and the phone-hacking scandal in the parent company's British division.

"Security and privacy are clearly of paramount concern for both parents and educators regardless of the vendor selected by the SED, and, rightfully so, that concern is significantly heightened when you consider the increased depth of the current phone-hacking scandal," wrote Richard C. Iannuzzi, president of New York State United Teachers, and Michael Mulgrew, president of New York's United Federation of Teachers, in a letter to the Board of Regents chancellor and the education department's commissioner.

But both Wireless Generation, the Brooklyn-based company in line to receive the contract, and the education department separately countered the fears raised in the letter, noting the primary purpose of the $27-million contract is to improve instruction and student learning with the creation of a statewide system of collecting and analyzing educational data.

The creation of this nonproprietary system is part of the federal Race to the Top $50-million grant awarded the state and will be open to applications created by other developers.

"Personal privacy IS of paramount importance to Wireless Generation," company spokeswoman Joan Lebow said in a statement. "We have been a widely respected vendor of educational software in all 50 states for over a decade, employing the highest privacy standards. We are an independent subsidiary of News Corporation and do not share student information."

The State Education Department asked the state comptroller's office to exempt the contract from bidding procedures, pointing out Wireless Generation's experience creating an instructional data system for New York City's schools and a tight deadline to launch the network by the fall of 2012.

On Monday, however, Iannuzzi insisted there is still time to conduct a transparent bidding process. "There is nothing in the timeline that warranted an exception to the rules in terms of allowing a no-bid contract," Iannuzzi said. "When you set that kind of stage, those who are going to be impacted by the contract become skeptical and have less trust in the system."

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