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Nobel Learning Communities, Inc - Letter of Correspondence

 August 26, 2005

 Via EDGAR

 Via Facsimile

 United States
Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, NE

Washington,
D.C. 20549-5546

Attention:
Larry Spirgel, Assistant Director

Re:
Nobel Learning Communities, Inc. Form 10-K for

 the
fiscal year ended July 3, 2004

 Filed September 15, 2004

 Form 10-Q for the quarter ended January 1, 2005

 File No. 000-27024

 Filed February 9, 2005

 Ladies and Gentlemen:

 This letter is issued to provide additional clarification with respect to the telephonic
discussion of August 9, 2005 among members of the SEC Staff, representatives of Nobel Learning Communities, Inc. (“NLCI”), NLCI’s auditor, BDO Seidman LLP, and NLCI’s counsel, Ballard Spahr, relating to NLCI’s letter to the
Staff dated July 28, 2005.

 We recognize this is a very long letter. The
following are characteristics of NLCI we are conveying with this letter in support of the determinations NLCI has made regarding its operating segments and reporting units:

1.
This letter is forward looking and describes how current management views NLCI’s fiscal 2005 operations,

2.
NLCI operates a single type of business within a similar economic environment with similar economic characteristics,

3.
The improved flexible nature of the organization new management has implemented which facilitates the interchangeability of human resources,

4.
New management’s changes that are based on its previous proven multi-site business experiences to direct the culture to support this flexibility and the strength this change
adds to the corporate fabric,

5.
Finally, how this combination of operating a single type of business with a culture of flexibility provides the platform for a robust and profitable business model as demonstrated
by NLCI’s recent results.

 Nobel Learning
Communities, Inc. • 1615 West Chester Pike, Suite 200 • West Chester, PA 19382-6223

 Phone 484-947-2000 • Fax 484-947-2003

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 NLCI appreciates the time required to fully review the content of this letter and thanks the readers in advance for their
commitment of this time.

 As a result of points raised in the August 9, 2005
telephonic discussion NLCI was requested to provide the following:

1.
Additional support for conclusion that the CEO is the CODM;

2.
Business purpose for the changes in internal organization, in particular the movement of district FL1 to the North region;

3.
Three years of gross margin information for the three regions - North, South and West; and

4.
Three years of HLA gross margin information and additional support as to why HLA is not a separate operating segment.

 Before responding to the Staff’s request, NLCI believes that it would be worthwhile
to put the discussion in context. NLCI does not believe that it has clearly articulated the basis as to why it has concluded that private pay schools represent one operating segment for fiscal 2005. The written and oral communications with the Staff
have primarily focused on technical issues. We do not believe there has been effective communication above the technical discussions to address the basic fact that since private pay schools which is one type of business with similar economic
characteristics represent substantially all the operations of NLCI, there is no basis on which NLCI can logically determine that there are additional operating segments. In concluding this, we have followed the guidance of SFAS 131.

 NLCI’s Board of Directors, CEO, COO, regional Vice Presidents and Executive Directors
of NLCI all view the private pay schools as generic business and operating models. This is evidenced by, among other things, a significant number of Principal changes among and within schools, the movement of responsibility for schools from one
Executive Director to another (expanding and contracting their span of control), the movement of Executive Directors from one Vice President’s span of control to another and the introduction in fiscal 2005 of the regional manager position to
create career opportunities within the private school business. All of these have occurred, to varying degrees, within fiscal 2005 and are the hallmark of new management’s operating model and strategy of creating a consistent management
approach when dealing with multiple locations of the same business. This is described in more detail in the following paragraphs. Each member of management is available to be interviewed and to attest to the forgoing at your request.

 NLCI views and operates its private pay schools, districts and regions as fungible entities
in similar physical plants. Discussed at length in other paragraphs below is 14 months of history (the 14 month period July 2004 through August 2005 is representative of fiscal 2005 and is the first fiscal period new management has had any
substantial influence over the operations) of how NLCI has had constant and meaningful change in the development of its field management structure. How NLCI has moved schools and districts between districts and regions with the confidence that the
skills required to run the entities exists at the level of the enterprise at which these assignments are made. NLCI is able to manage the enterprise successfully in this manner due to the single type of business activities and its similar
qualitative and quantitative economic environment. Said differently, the positions identified on our organization chart and the lines and columns

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 on our reports do not represent a different type of business activity with a different economic environment. The
positions more appropriately would have been identified with a person’s name such as Kathy Willard for the North, because Kathy is known in the organization to manage certain districts and, as those districts change, we communicate the new
alignment for Kathy throughout our company. The company views reassignments of districts or schools as a positive response to the strength of the individual’s performance. Management believes performance based rewards are a stronger
motivational tool than seniority based rewards and as such is driving NLCI towards individual performance based rewards. Management believes that the organization is enhanced when such changes occur based on performance. Trust in management
increases when pay and responsibility are rewards for individual performance. Similarly, at the district level, an Executive Director’s name would have been more appropriate than a district’s name, because the organization knows which
schools report to each Executive Director and we communicate when schools are moved among Executive Directors. These reassignments again are based on their capacity to handle the work. The company understands this to be a positive response to the
strength of the individual’s performance. It is important to keep in mind that at its root the enterprise is an assembly of homogeneous, generically run operations that are not a different type of business within different economic
environments. This is the way management operates the enterprise and as such we believe that the only logical conclusion is that the same type of business exists below the private pay schools operating segment level.

 Please note NLCI took to heart the following guidance from SFAS 131 in reaching the above
determination as to whether or not operating segments could exist below the private pay schools operating segment:

•

Paragraph 3. The disclosure objective of SFAS 131 is to “provide information about the different types of business activities in which an enterprise engages and the
different economic environments in which it operates to help users of financial statements:

a.
Better understand the enterprise’s performance

b.
Better assess its prospects for future net cash flows

c.
Make informed judgments about the enterprise as a whole.”

 NLCI has determined that the private pay schools conduct only one type of business activity - that of selling education services in its schools to
private paying customers. Additionally, NLCI determined that both the external economic factors affecting its business and the internal economic measurements used to assess performance are homogeneous and generic throughout the enterprise. The very
fungible nature of its management, that is the ability to move individuals in different regions or districts around, adds additional support to the conclusion that NLCI truly is engaged in one type of business with one set of operating guidelines.
Based on the fungible nature of its business in general, NLCI determined the segment information provided to its financial statement users is the best information to enable a user to understand the enterprise’s performance, assess future for
net cash flows and make informed

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 judgments about the enterprise as a whole. These facts and beliefs led NLCI to determine its one
segment of business, private pay schools, is correctly identified as one operating segment. The discussions below will more fully describe support for the flexible nature of its management, and the like internal and external economic environments
the enterprise operates within.

 NLCI worked diligently to
determine what information is relevant to a user’s understanding of NLCI’s financial results and prospects. NLCI as discussed below and above has had and will continue to have significant changes in the form of its reports and field
management structure. To conclude from the form of either of these that NLCI operates a different type of business at some assumed reporting, geographic or organizational structure would entirely miss the fact that it operates one type of business.
To conclude that long term external or internal economic environments are somehow different would miss the relevant criteria discussed in previous submissions and reiterated below. As discussed below, NLCI believes it meets the objective and basic
principles of disclosure on disaggregated financial information and complies with the spirit of SFAS 131 by providing information about the different types of business activities in which NLCI engages when they exist and/or when different economic
environments exist. NLCI has determined it has two operating segments 1) private pay schools and 2) management services provided to charter schools. NLCI believes this comports with the objectives, principles and spirit as well as the technical
criteria and guidance of SFAS 131. An enterprise which operates in a single type business like NLCI best addresses a user’s need for more disclosure about the business with robust M,D&A discussion providing transparency about risks and
trends in a business, rather than through a discussion about the fungible nature of its operations. NLCI is not concerned about the competitive harm it may incur as a result of disclosing additional disaggregated information. We believe the
inclusion of disaggregated financial information that does not provide useful and meaningful insight into the enterprise would not be informative to the user. More importantly, NLCI constantly changes the arrangement of schools, districts, Executive
Directors, Regional Managers and Vice Presidents. As a result basing operating segments on those artificial management levels, NLCI’s reporting to investors and regulatory bodies could fluctuate every year, which would generate
confusion regarding the private pay school business.

 CODM
Determination

 Following is discussion regarding NLCI’s
determination that its CEO is its CODM. The CEO has two significant charges from the board of directors to be successful at profitably growing NLCI. The first is to develop the appropriate strategic direction for NLCI. The second is whether the
right individuals are in place to successfully manage and grow

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 NLCI. Strategic direction requires that the CEO with the advice of the board of directors allocate resources to the
appropriate operating segments. In our case, this is would be to allocate resources to the private pay school segment or to invest in new segments outside of this core business. In order to accomplish the second charge, relating to personnel, the
CEO working through the chain of command has access to many levels of information which is used to determine that the right individuals are in place to accomplish successful growth.

•

Paragraph 10 b. “Whose operating results are regularly reviewed by the enterprise’s chief operating decision maker to make decisions about resources to be allocated
to the segment and assess its performance.”

 NLCI’s CODM receives a wide variety of information from formal delivery of reports to informal discussions, to review weekly and monthly operating metrics and economics of the business. This information is used to make decisions about
resource allocation at the operating segment level. The information whether detailed or summarized does not dictate the manner in which NLCI and its CODM manage its business. This is due to the fungible nature of its operations and the manner in
which material strategic or tactical decisions are made by the CODM. The CODM decides the overall allocation of resources to the two operating segments, and then he relies on his chain of command to determine where to best place resources in the
segments.

•

Paragraph 12. “The term chief operating decision maker identifies a function, not necessarily a manager with a specific title. That function is to allocate resources to
and assess the performance of the segments of an enterprise. Often the chief operating decision maker is its chief executive officer, but it may be a group consisting of, for example, the enterprise’s president, executive vice presidents and
others.”

 NLCI considered whether the CODM
function may be performed by a group. NLCI reviewed how it operates its business, how decisions are made and determined that the chief operating decision maker function is completely embodied in its CEO. The CEO is the sole arbiter of resource
allocation to the private pay school operating segment as a whole (not at a detailed level) and as one type of business enterprise operating within the same economic environment.

•

Paragraph 13. “For many enterprises, the three characteristics of operating segments described in paragraph 10 clearly identify a single set of operating segments. However, an
enterprise may produce reports in which its business activities are presented in a variety of different ways. If the chief operating decision maker uses more than one set of segment information, other factors may identify a single set of
components as constituting an enterprise’s operating segments, including the nature of the business activities of each component, the existence of managers responsible for them, and information presented to the board of
directors.”

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 NLCI’s CODM as presented previously and discussed further below has used a variety of data points
on the private pay segment. NLCI believes that the information the CODM gathers adds to the understanding of the different nuances that exist in NLCI’s operations but does not indicate that the operations are different types of business. NLCI
has previously presented (in consideration of aggregation criteria paragraph 17 SFAS 131) criteria why its business units in the private pay segment constitute the same business activities:

a.
Each has similar economic characteristics

b.
Each provides educational services in all of our schools

c.
Each delivers curriculum based education to customers

d.
Each has customers who are pre-school and school age children and their parents

e.
Each provides our services through schools

f.
Each has operations that are subject to similar state and local regulations and licensing requirements.

 In addition, NLCI looks to the existence of responsible managers b