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President-elect Barack Obama intends to name a big-city schools chief, Chicago’s Arne Duncan, to help fix the country’s ailing schools as education secretary, people familiar with the decision said.

Duncan has run the country’s third-biggest school district since 2001, pushing to boost teacher quality and to improve struggling schools and closing those that fail. Student test scores have risen significantly during Duncan’s tenure.

One of the schools Duncan turned around — Dodge Renaissance Academy, which he shut and then reopened on Chicago’s West Side — was chosen as the backdrop for Obama’s announcement Tuesday. Obama and Duncan visited the school together in 2005.

The individuals who confirmed the selection of Duncan on Monday spoke on condition of anonymity because Obama had not made the decision public.

A 44-year-old Harvard graduate, Duncan has played pickup basketball with Obama since the 1990s. Duncan co-captained the Harvard basketball team and played professionally in Australia before beginning his education career.

He ran a nonprofit education organization on Chicago’s South Side before going to work in Chicago schools under former superintendent Paul Vallas, now the New Orleans schools chief.

Duncan’s nomination will please reform advocates who wanted a big-city schools chief who has sought to hold schools and teachers accountable for student performance; they had backed Duncan or New York’s Joel Klein.

These advocates have squared off against teachers’ unions in a contentious debate among Democrats over whom Obama should choose. Unions, an influential segment of the party base, wanted a strong advocate for their members such as Obama adviser Linda Darling-Hammond, a Stanford University education professor.

Yet Duncan’s nomination may please the unions, who have said Duncan seems willing to work with them.

Arne Duncan actually reaches out and tries to do things in a collaborative way,” Randi Weingarten, head of the 1.4 million-member American Federation of Teachers, said in an interview earlier this month.

Obama managed during his campaign to avoid taking sides in the debate, which centers on accountability and the fate of President George W. Bush‘s No Child Left Behind law. Duncan also has tried to appeal to both factions; he signed competing manifestos from each side earlier this year.

Sen. Edward Kennedy, chairman of the Senate Health, Education, Labor and Pensions Committee, which must confirm the education nominee, called Duncan a consensus candidate.

“Arne has been a pragmatic and effective leader of Chicago’s schools,” the Massachusetts Democrat said in a written statement. “He’s brought people together to address difficult challenges and expand opportunities so that every child can succeed.”

House Education and Labor Committee Chairman George Miller, D-Calif., called Duncan “a very good choice for school reform and our schoolchildren.”

“He is an experienced and accomplished leader who is open to new ideas for improving our schools,” Miller said in a statement.

The choice of Duncan answered those who had wondered whether the investigation of Illinois Gov. Rod Blagojevich might hurt the chances of a Cabinet contender from the same state.

As for the governor, Obama told a news conference Monday that an internal investigation by his transition team shows that he had no direct contact with Blagojevich about the appointment of a replacement for Obama in the Senate and that his transition aides did nothing inappropriate. Blagojevich, who has the sole authority to appoint Obama’s successor, was charged last week with putting the Senate seat up for sale.

Obama promised to release the results of the transition’s investigation but said federal prosecutors asked him to hold off until next week to avoid compromising their investigation of Blagojevich.

Obama also introduced his environment and energy team, including Steven Chu as energy secretary, Lisa Jackson as Environmental Protection Agency administrator, Carol Browner as his energy and climate “czar” and Nancy Sutley to lead the White House Council on Environmental Quality.

In the education debate, the competing sides differ over the degree to which teachers and schools should be held accountable for how well kids learn and over the role test scores in measuring that.

Central to the dispute: No Child Left Behind, the law that has grown as unpopular as Bush, the lame-duck president who championed it.

The reform group agrees with the law’s general principle of penalizing schools where test scores fail to improve, although nearly everyone sees some problems with the law. The union coalition says test scores aren’t the only measure and that factors beyond the classroom affect how well kids learn.