Redact or Keep? A Fully Local AI Cascade for Educational Dialogue De-Identification

Abstract: Educational dialogue is a valuable but sensitive resource for research: the same transcripts that capture authentic learning often capture personally identifiable information (PII) entangled with curricular content, where "Riemann" may refer to a real student or to a mathematical concept. Existing approaches force a tradeoff between governance and accuracy. Commercial LLMs can handle this ambiguity but require sending student data to third parties, while local named entity recognition (NER) systems preserve governance but over-redact curricular terms. We propose a fully local cascade framework that reframes de-identification from open-ended entity recognition to constrained privacy triage. A recall-first union proposer combines two lightweight encoders with deterministic rules to over-generate candidate spans; a context-aware reviewer then makes a binary Redact/Keep decision for each candidate using surrounding dialogue and speaker role. We evaluate three reviewer configurations against same-family LLM-only baselines and a commercial API on math tutoring transcripts from two large platforms. The strongest local configuration reaches 0.958 macro F1, compared with 0.767 for a same-family LLM-only baseline and 0.706 for the commercial API, while running entirely on a single laptop. On a targeted challenge set of curricular-personal name ambiguity, the same configuration degrades by only 0.03 F1 versus 0.19 to 0.25 for smaller reviewers. These results suggest that for educational de-identification, problem formulation matters more than model scale.