This is certainly the way to teach historical research and I commend the teacher for being so innovative and willing to take the risks of what might be the result of the students' research.
But this is very time consuming to cover a short period of history. It is also looking at the local history more than national. How does he get through the 160 years from 1860 to the present? There are a lot of significant periods that I doubt he has time to treat in this fashion -- the rise of the factory and the labor union, the start of an American empire, the treatment of the Indians post-CW, the rise of evolution as the explanation of all things living, socialism in all its forms (German, Russian, European, American), the rise of the strong central government, and on and on.
I think the problem has become one of too much material to cover in one year -- discovery to present. The time allowed is the same that was given me -- and we have had 60 more years of history to jam in the same time. We are also trying to look more closely at history, not just run past names and dates.
I don't know where schools will find the additional time -- the arts, vocational skills (home ec, shop, etc) and PE are already pretty much gone. Maybe we need a 5th year of high school (that idea will certainly make me friends!).