Perhaps the most practical first step would be to find an accessible contra for your student to try out? Perhaps a professional (or an orchestra) who owns one would let her play it a few times and see how she gets on? Even if it involves a bit of travelling it would be worth while.
Seems a bit extreme to even think of buying one when you don't even know if anyone will really want to play it!

if you want to keep your students challenged why not get a piccolo or a bass clarinet or something as $16,000 does seem alot to spend on an instrument that may only be used by that one student for the next 2-3 years a better choice would be something that is more similar to a more common intrument- like viola or piccolo

A piccolo or bass clarinet?? If you're gonna resort to taking up a completely different instrument to keep the pupil challenged, at least make them learn the flute or clarinet first! Piccolos and bass clarinets may by much cheaper than contrabassoons but i don't think they should be attempted until the player is competant with the main instrument in that family. Good idea to take up another instrument though, but she'd find it really easy and you'll end up having the same problem but on two different instruments.

It isn't a case of my trying to keep this ONE student challenged on SOMETHING, the band director wants to purchase a contra and share it with the high school. My student is extremely talented, and already in 7th grade, she has decided she wants to be a music performance major, has made All-State as a sixth grader (will likely be 1st chair as a 7th grader, etc.), plays in an audition only band in the Atlanta area one night a week, etc. So yes, while this student in the middle school band needs to be challenged, I wouldn't be putting her on another instrument. I'm seeking out harder, more challenging music and other venues for her to play. My issue is this: is a middle schooler physically capable of handling the instrument. And, even a very talented one like mine, is middle school too early to put them on a contra with the differences in pressure, embouchure, fingerings, etc. Yes she's great, but she's still learning. The high school would also use it, however they have only two players and both are seniors. The next one coming up is MY 7th grade student. Until there are more bassoonists in the pipeline (particularly at the high school), I don't think it's a wise choice, especially for the cost. But my biggest concern is that it's just not appropriate for the middle school aged student, regardless of how talented.

The early posts indicate that perhaps I'm right - it's too different to try flipping back and forth at this stage of her development. Is that a good assumption?

I think i would agree with that. I wont pretend to be the most talented musician in the world, but i started the bassoon when i was fourteen and passed my grade 8 when i was eighteen, then went to the Royal Northern College of Music last year, even though i'd been suffering with an awful jaw problem for 2 years. I was very good as school pupils go, and i didn't touch the contra until my last year before music college, when there was a part for it in my (very very very good) youth symphony orchestra, after i'd passed my grade 8.
I can only think of one school in the area where i grew up that had the money and potential for a contra (a snobby private school where children were forced to practice) and even they didn't have one. I just don't think it's worth it that early on. Sorry to ramble on and on, just thought this stuff might be relevant as i'm just out of the school system myself and can maybe offer a different perspective?
It's lovely to hear of such a promising student! Hopefully she wont get fed up of it like i did :s

With everything that has gone before, I think you have gotten the gist of feeling among posters now - we feel a contrabassoon is not appropriate for a middle school. This one student might merit it - BUT - in general it is not really a middle school instrument, for all the reasons that have been mentioned before.

If you really want to challenge your exceptional students, I would suggest you get the band director to get these young musicians into ensembles, either in their own age groups or with older players. If you have the contacts, organize them yourself. Ensemble playing adds a dimension not possible in band or orchestra and is tremendously exciting for a player.

We are certainly doing that, Drew. Although there's not a lot to offer for middle schoolers in the area, there are MANY ensembles once she hits 8th/9th grade and up that will keep her more than challenged. There are wind ensembles, wind symphonies, symphonic orchestras, and I may look into organizing woodwind quintets or ensembles closer to home for the more talented ones at the school for solo/ensemble competitions. Kids are so busy these days, though, but she seems very motivated. If I can keep her fingers safe from volleyball! :-)

I had her play some of the Galliard Sonatas last year and will choose some of the more difficult movementes for her this year. I may spring the last movement of the Mozart on her next year. She might well be up for it this year, but I didn't play it till I was 17, so giving it to her at age 12 is a bit much for my ego to take! :-) And where after that: 1st movement in 8th grade ... four more years of high school. I keep telling her and her mother that she will soon outgrow me as a private teacher since she will pass me in proficiency in fairly short order!!

She sounds like a winner!