Education Funding

District Pays Ackerman’s $905,000 Buyout After Funders Back Out

By Dale Mezzacappa & Philadelphia Public School Notebook — September 07, 2011 3 min read
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The mayor had declined over several weeks to answer a list of questions posed to him by the Notebook over his involvement in the private fundraising effort and whether he had fully vetted the consequences of seeking anonymous, tax-deductible donations and funneling the money through the district’s charitable foundation arm. The only involvement he has acknowledged is making “a couple of calls” to prospective donors.

The Philadelphia School District has paid former Superintendent Arlene Ackerman’s entire $905,000 buyout package, an expense officials had expected to split with private donors.

“Almost all” of the anonymous donors who had said they would contribute $405,000 have backed out, according to a district statement released late Wednesday that was attributed to the School Reform Commission. Philadelphia’s Children’s First Fund, a nonprofit that was to funnel the private donations to the district, has returned what donations it did receive toward the buyout.

The district had been planning to contribute $500,000 of its own funds.

The district also decided not to pursue an inquiry into whether Ackerman had violated a clause in the agreement not to disparage district officials or staffers in three interviews she gave after she left.

“We just want her to go away,” said one district insider.

A spokesman for Mayor Nutter, who had helped solicit the private donations, said “It just didn’t work out.”

Here is the text of the district statement issued late Wednesday afternoon:

Today, the School District of Philadelphia disbursed the payment due to Dr. Arlene Ackerman under the mutually-agreed-upon Separation Agreement ratified by the School Reform Commission on August 24. The SRC is aware that questions have been raised about recent statements made by Dr. Ackerman. As stated last week, the SRC disagrees with these assertions. We also believe that it is a better use of the School District’s resources to focus our time and energy on ensuring that this school year is as successful as possible. Since the terms of the settlement agreement became public two weeks ago, there has been considerable discussion of the plan to supplant some public monies with contributions from private donors who requested anonymity as a precondition of donation. From the start, the School Reform Commission sought to keep the public cost of this agreement to a minimum. But the public concerns about the use of anonymous private donations led almost all donors to withdraw their pledges to contribute to the Philadelphia’s Children First Fund. The SRC accordingly, asked the Philadelphia Children’s First Fund to return any donations it has received in connection with our request of it to accept funds on behalf of the District for this purpose. As a result, the payment to Dr. Ackerman does not include payments from anonymous private donors. Instead, all funds to Dr. Ackerman are public dollars from the Philadelphia School District. Yesterday, the District had a tremendously successful opening of schools and a great first day. We intend to move forward and return our focus to the important work before us of building a system of great schools for all of our children. —statement attributable to the School Reform Commission

Ackerman had been criticized for her management style as superintendent and accused of mismanagement; violence in city schools, cheating allegations and a budget shortfall all drew complaints. She has since said that was pushed out over political disagreements.

The SRC decided not to try to terminate Ackerman for cause, or simply end her tenure under extraordinary powers it has from the state, figuring either solution would lead to litigation. Along with Nutter, the SRC decided to negotiate down the $1.5 million she was entitled to under her contract, which had been extended just months before the decision was made that she had to go.

Who came up with the idea to do private fundraising for the Ackerman buyout is still unclear. On Wednesday, Nutter spokesperson Mark McDonald said the idea came from “SRC folks.”

“The mayor pushed very hard to keep the outlay of public funds as low as possible,” said McDonald. “He set a benchmark of $500,000. He saw it as a viable way to achieve his goal of quickly ending the leadership dysfunction and budget concerns” in the district.

The mayor had declined over several weeks to answer a list of questions posed to him by the Notebook over his involvement in the private fundraising effort and whether he had fully vetted the consequences of seeking anonymous, tax-deductible donations and funneling the money through the district’s charitable foundation arm. The only involvement he has acknowledged is making “a couple of calls” to prospective donors.

One vocal critic of the original buyout plan, Zack Stalberg, CEO of the Committee of Seventy, suggested that the scheme to solicit anonymous donations may have backfired.

“I think if this deal had not been set up in a secret way in the beginning it’s possible that the public would have gotten away with paying a good deal less,” Stalberg said. “But clearly the donors didn’t want to be publicly associated with it and now the cost to the taxpayers is a lot more.”

“On the positive side of the scale, people finally came to their senses and decided that the arrangement in which the donations would be kept secret just wasn’t proper,” he added.

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Republished with permission from The Philadelphia Public School Notebook. Copyright © 2011 The Philadelphia Public School Notebook.

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