Budget & Finance

D.C. Teacher Contract Financing Under Investigation

By Dakarai I. Aarons — June 08, 2010 3 min read
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The District of Columbia’s Campaign Finance Office is investigating whether actions taken by schools chancellor Michelle A. Rhee in negotiating an agreement with the private foundations that are supporting D.C.'s new teacher contract resulted in a direct personal financial benefit for Rhee and constitutes a conflict of interest or possible abuse of office.

The complaint was filed by Robert Vinson Brannum, the president of the D.C. Federation of Civic Associations, who has been critical of Rhee’s management of the school district. In a letter he sent last week, he cited provisions in the agreements with the foundations that say they can pull their funding if there is a change in leadership of D.C.'s schools.

The Eli and Edythe Broad Foundation, the Robertson Foundation, the Walton Family Foundation, and the Laura and John Arnold Foundation are providing nearly $65 million to help pay for the big raises that teachers will get under the new contract.

As close readers of this blog know, Rhee’s future as chancellor is anything but guaranteed. Her boss, Mayor Adrian M. Fenty, faces a stiff challenge for re-election this fall from Vincent Gray, the city council chairman who has been critical of Rhee and Fenty’s management of the schools. Gray has to date been unwilling to say whether he would retain Rhee as chancellor if he becomes mayor.

The conditions imposed on the foundation funding also raised red flags for the city’s chief financial officer, Natwar M. Gandhi, who initially refused to fiscally certify the contract.

But The Washington Post’s Bill Turque said in a story this morning that the provision in question is effectively rendered moot because of the way Gandhi and Rhee ultimately structured the financing so it would pass muster. The compromise borrows money from other parts of the city budget temporarily and will use $21 million in foundation funding to pay retroactive raises immediately to teachers.

After reviewing Brannum’s complaint, the director of the campaign finance office, Cecily E. Collier-Montgomery wrote in a June 4 letter to Rhee that she’d found there may be “reasonable cause to believe a violation has occurred” and has launched a full investigation.

In an e-mail response to me this morning, Brannum said he was not politically motivated (he’s supporting Gray for mayor) to file the complaint and that it does not stop D.C. teachers from getting a raise. His concern is with a public employee agreeing to a contract with outside entities that essentially guarantees the continued appointment of that city employee, in this case, Rhee.

“The private donors’ can set conditions to policies they wish the District to undertake; however, they do not have the right to condition them to a person,” he said. “Let us presume everyone is on board with a policy (teacher performance pay) and the funding stream has been tied to the theory of “no change in leadership”. A change in leadership does force an automatic change is policy.”

“What happens to the funding if the current leadership should voluntary leave, be forced out for cause, or die?,” Brannum continued. “Just as private donors have the right to set conditions, the people have the right to set and affirm government policies.”

Jennifer Calloway, Rhee’s spokeswoman, told The Post Brannum’s claims are unmerited.

“The chancellor did not violate any law. Any suggestion that she received some personal benefit from private funding of the [Washington Teachers’ Union] contract is nonsense,” she said.

The contract, which was approved by a vote of the teachers’ union membership last week, is expected to be approved by the D.C. City Council shortly.

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A version of this news article first appeared in the District Dossier blog.

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