Leaders Group Stung By Board Resignations

By Jeff Archer — March 31, 2004 3 min read
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The Education Leaders Council, which has sought to position itself as a prominent national advocate for school choice and accountability, has been dealt a major blow by the resignation of several members of its board of directors amid claims of mismanagement leveled at its Washington headquarters.

Four board members—all well-known figures in education—quit on March 29, citing concerns raised over the past year about the group’s use of federal money and about the salaries and employment terms of its executives.

In a joint letter to Florida Commissioner of Education Jim Horne, who chairs the ELC board, they accused others still on the panel of failing to adequately address their concerns.

“We cannot continue to be associated with an entity that has lost its moorings and whose credibility has been seriously damaged by issues that could have been solved had action been taken in a timely and responsible manner,” they wrote.

The four members who resigned this week are former U.S. Rep. Bill Goodling, R- Pa., the retired chairman of the House of Representatives’ education committee; Colorado Commissioner of Education William J. Moloney; Minnesota Commissioner of Education Cheri Pierson Yecke; and Abigail Thernstrom, an author and a member of the Massachusetts state board of education.

Their departures follow those of at least four other ELC board members who resigned over the past six months as the board of directors became increasingly divided over how to respond to questions about the organization’s operations. (“Leaders Group Faces Shortcomings,” Jan. 21, 2004.) The board now has just eight members.

Those remaining on the board, including ELC Chief Executive Officer Lisa Graham Keegan, disputed the notion that the group had sought to sweep any problems under the rug.

In February, the board agreed to hire an external auditor to carry out a “forensic” review of its operations. Ms. Keegan characterized as “dishonest” the claims made by the four board members who resigned this week.

“These individuals didn’t want to solve the problems; they wanted to proclaim that there is a problem and that nothing has been done,” Ms. Keegan said in an interview. “That is blatantly untrue.”

Strife among the members of the ELC board had been mounting since last May, when an audit of the organization raised what some board members saw as a number of red flags. The report said, for instance, that the group hadn’t been adequately reporting time spent by ELC staff members on its biggest project, an initiative called Following the Leaders, which is underwritten by $23.5 million in federal money.

Since then, board members have sparred over numerous other management issues, particularly related to Ms. Keegan’s leadership of the organization. With a salary of $235,000, she is officially an independent consultant and lives in Arizona, where she formerly served as the state’s schools chief.

While criticizing Ms. Keegan’s management, many of those who have recently left the organization’s board argue that the ELC has become too dependent on federal money. When she became the CEO in 2001, Ms. Keegan laid out ambitious plans to raise private funds, but in 2003 federal grants paid for more than half of all salaries paid to the ELC’s 14 staff members.

Most of the federal funding is for Following the Leaders, which gives technical support to schools to help them in meeting the student-performance requirements under the federal No Child Left Behind Act. Seeded with $3.5 million from the U.S. Department of Education in 2002, the project has since been awarded two $10 million allocations. Much of the money has been used to hire subcontractors to carry out the initiative.

“The focus of the organization has moved away from its original mission of advocacy for reform, and been transformed essentially into a manager of a federal program,” Mr. Moloney said in an interview last week. “That program, Following the Leaders, has become the main financial prop of ELC. It pays the rent, it pays the salaries.”

Mr. Horne, the board chairman, agreed that the ELC needs to shift more of its energies back to advocacy, and he said he hopes to spin off Following the Leaders as an independent project in the near future.

But he maintains that the group is getting its house in order. It is in negotiations with an accounting firm to carry out the forensic review of the ELC’s finances and operations. The group also recently hired a new chief financial officer. Mr. Horne said he has “unwavering confidence” in Ms. Keegan’s leadership.

“I think ELC will come through whatever this little fog is stronger, and better, and more powerful than ever before,” he said.

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