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Teach For America May Be Facing $3-Million Budget Deficit

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Teach For America, the nonprofit national teacher corps that began in 1989 as the brainchild of a Princeton University undergraduate, is facing the prospect of ending its fiscal year in September with a budget deficit of more than $3 million.

The organization, which recruits recent college graduates to teach for two years in inner-city and rural public schools with shortages of credentialed teachers, has raised only $3.8 million of its $7 million budget for this year, TFA officials said last month.

Nevertheless, the group, which has grown rapidly from its inception and a first-year budget of $2.5 million, plans to expand its network this fall from 10 teaching sites to 12 by adding Baltimore and Washington.

The cash crunch comes just as the program has graduated its charter group of corps members--60 percent of whom plan to stay in teaching--and has redesigned its pre-service training institute and two-year course of professional development for corps members.

The group's founder, Wendy S. Kopp, and Ian M. Huschle, its vice president for development, readily acknowledge the organization's shaky financial condition, but say they are not alarmed by it.

"Our financial situation has not really changed since day 1--it's still hand-to-mouth," Ms. Kopp explained.

By mid-summer, TFA had raised, since its inception, a total of $15 million in cash and commitments through 1994, Mr. Huschle said.

While it has several grant proposals pending before foundations and corporations that could help narrow the budget gap, it appears that at least one of those funders will not be able to honor the group's request.

The Lilly Endowment, which has so far given the program $1.2 million, has taken a beating on stock investments, said Joan Lipsitz, Lilly's program director for elementary and secondary education.

The bleak prospect for a TFA grant "has nothing to do with our respect for Teach For America," said Ms. Lipsitz, who added that a final decision will not be made until next year.

If it ends the fiscal year with a significant shortfall, Mr. Huschle said, his group would have to consider scaling back its operations.

But the apparent crisis does not seem to faze observers, including Ms. Lipsitz.

"We've been worried every year that they've expanded ... and each year they have raised the funds in a kind of 'Perils of Pauline' way," she said. "I have learned to be confident of Teach For America's ability to come out of a bad financial situation."

For an organization that has grown as rapidly as Teach For America, "this kind of problem should not be unexpected," said Mary Leonard, the director of precollegiate-education programs at the Council on Foundations.

"They're having growth pains is what they're having," she said.

New Fund-Raising Strategies

Recognizing the need to diversify their fund-raising and to ensure the source of long-term operating revenue, TFA officials are considering a number of different strategies.

The group has placed more emphasis on local and regional funders in the areas where corps members teach, for example, and two specific funding ventures have already started to move forward, officials said.

At least eight Los Angeles-area individuals have agreed to "adopt" a corps member by donating $5,000 apiece to meet a teacher's recruitment, training, and support costs for two years.

It has also been negotiating with an unnamed "high-volume, consumer-goods company" to develop a cause-related marketing campaign that would send a portion of the profits from sales to Teach For America.

Other strategies include seeking out new or existing sources of federal funding and creating a profit-making consulting arm in teacher recruitment and training. Launching a direct-mail campaign has also been discussed, Mr. Huschle said.

Another option lingers, as it has since the group's founding: collecting fees from the schools or districts that employ corps members.

The prospect is a "tricky" one, Ms. Kopp concedes, but she considers district, state, and federal sources TFA's best chances for long-term funding.

Ms. Leonard said that, while regional fund-raising holds a lot of promise and that the corporate marketing partnership is a good short-term strategy, both the search for federal funding and the "adopt a corps member" drive are difficult and time-consuming ways to raise money.

Also, she said, the abundance of consultants and the irregular income from that line of work make that approach less than promising for the group.

The best bet for stable, long-term funding, Ms. Leonard agreed, could be fees from participating districts.

Training Program Revamped

Teach For America has also made major changes in its professional-development efforts, beginning with the six-week, pre-service summer institute that marks the start of the corps members' two-year commitment.

The new training curriculum is outcome-based and has been adapted from the "Draft Outcome-Based Standards and Portfolio Assessment" developed by the National Association of State Directors of Teacher Education and Certification.

For the first time this summer, institute participants completed a series of practical assignments--in curriculum development, classroom management, and parent involvement--individually and as part of a 10- to 12-member "learning team." They also spent 12 full days practice teaching, participated in discussion groups, and completed other tasks.

Ms. Kopp said the pre-service activities were redesigned to address concerns of veteran corps members that they were unprepared for their first year of teaching and to give trainees more choice in their course of study.

While corps members have been expected to enroll individually in programs run by local universities and districts in order to earn certification, Ms. Kopp hopes state departments of education will eventually recognize the new TFA scheme itself as a certification program.

Meanwhile, Ms. Kopp said she is "very pleased" that more than half of the charter corps members will continue in teaching.

Of the 342 novice teachers who stayed for two years, 177 will continue in their placement site, 29 will teach in other schools, and 11 will pursue graduate education degrees.

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