Foundation Scheme Leaves Schools in Shock

By Meg Sommerfeld

Until recently, the Delaware County Christian School in Newtown Square, Pa., was anticipating a year of tremendous growth: It planned to invest $125,000 in computers next year, buy more land to expand its facilities, and increase enrollment.

But now the private K-12 school is looking at a $300,000 deficit in its $5 million annual budget, and its expansion plans are on hold--all because it got involved with a foundation that had promised to help the school but apparently ended up only taking its money.

Earlier this month, the Radnor, Pa.-based Foundation for New Era Philanthropy declared bankruptcy, leaving 300 schools, colleges, churches, and other nonprofit groups that had invested money...