This monograph describes the concept of school district contracts with teacher partnerships for educational services; taking the view of education as an industry, the document analyzes advantages, obstacles, and strategies of such a change. Section 1, "The Challenge," suggests that societal changes make an education industry outside the K-12 system attractive, although the industry's foundation is dependent on the public system. The section discusses the growing "non-school" education industry and recommends that entrepreneurial teachers be encouraged in order to retain talent. Section 2, "Constraints against Innovation within the Existing Structure," describes how regulations stifle teacher incentives. "The Creative Response: Entrepreneurism among Teachers," section 3, analyzes a partnership's legal aspects, contract terms, and the result of greater work environment control by teachers. Section 4, "Potential Obstacles to Implementation," explains that contracting need not compromise school conditions or the status of administrators and teacher organizations. The document recommends that partnerships be defined by law, that accountability reside with a partnership's certified teacher operators, and that students be protected through district evaluation of partnerships. Section 5, "Demonstrating the Idea's Effectiveness," discusses selection of a demonstration site. The summary concludes that a competitive, professional model for educational services provides a coherent mechanism of promoting excellence. (CJH)