Education Funding

Wary Foundations Tie Grants To Leadership Stability

By Jeff Archer — February 12, 2003 8 min read
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When the Broad Foundation put up nearly $2 million last fall for a comprehensive planning study of the New York City schools, the gift came with a noteworthy string attached: The philanthropy can pull its support if Schools Chancellor Joel I. Klein leaves the system.

“This is an insurance policy,” Dan Katzir, the managing director of the Los Angeles-based foundation, said in a recent interview. “If a key player is removed or leaves, we think it’s important to put a grant on hold and take a closer look.”

In this era of revolving-door district leadership, funders that give grants to urban school systems are trying to better protect their investments.

Like the Broad Foundation, some philanthropies are reserving the right to halt funding if a district official who wins a grant moves on before the project is completed. Others are demanding well-thought-out succession plans. And most are taking new pains to size up leadership stability when deciding which districts to support in the first place.

“I think a number of foundations have felt they’ve been burned,” said William Porter, who serves as the executive director of Grantmakers for Education, a national network of charitable groups. He is based in Portland, Ore.

Mr. Porter’s organization plans to examine such strategies at an invitation-only meeting later this month in Pittsburgh, where the issue boiled over last summer. Infighting among members of the Pittsburgh school board and the superintendent prompted three area foundations to freeze nearly $4 million in grant money they had pledged to the system for this school year.

That kind of assertiveness has drawn complaints from some observers, who see it as meddling in a district’s ability to govern itself. But foundation officers say they have a legitimate stake in making sure their efforts aren’t derailed by leadership instability. Changes at the top in a district can bring broad swings in agendas, they note, and in the process, projects begun under a previous leader run the risk of being left to wither.

“What you’ve got in this country is a bunch of very bright superintendents,” said Marshall Smith, the education program director for the William and Flora Hewlett Foundation, based in Menlo Park, Calif. “Many of them are very talented. But they jump from place to place, partly because they’re pushed out by a school board, or because they jump ship.

“And nobody can be successful in just a few years.”

If grantmakers are gun-shy, their attitude comes from experience, said Robert Schwartz, a former executive at the Philadelphia-based Pew Charitable Trusts who teaches a course on philanthropy and school change at Harvard University’s graduate school of education.

Tough Territory

While he was at Pew in the 1990s, Mr. Schwartz pointed out, the trusts gave a series of grants totaling about $10 million to seven districts to help with their efforts to raise student achievement. By the end of the five-year grant period, he said, the top school officials in all seven systems had left their jobs.

“You just have to be willing to operate in an environment where there are things outside of your control,” Mr. Schwartz said. “If you’re looking for safe grantmaking, urban education isn’t the place to look.”

But while turnover may come with the territory, many of the grantmakers most active in K-12 education today are trying to limit the chances that their work will fall prey to it. In addition to Broad, foundations that have tied grants to the continued employment of certain district leaders are Atlantic Philanthropies, the Bill & Melinda Gates Foundation, and Hewlett. (Atlantic, Broad, and Hewlett provide funding for coverage of issues in Education Week.)

Some philanthropies have shown themselves willing to use their prerogatives. Gates Foundation officials say that in the past two years, they’ve temporarily suspended funding for four different projects because of superintendent turnover.

In a sign that the issue isn’t solely an urban one, the longest of those suspensions was in Coventry, R.I., a 6,000-student district outside of Providence. Gates put a $3 million grant to the system on hold for 10 months following the departure of John Deasy, the well-regarded superintendent, who now holds the top job in California’s Santa Monica-Malibu Unified School District.

Not only did the Rhode Island district struggle for several months to find a replacement, but the turnover also coincided with a change in leadership at Coventry’s only high school. The grant had gone toward creating smaller learning environments for students, a major initiative of the Gates Foundation.

“It appeared that the work, particularly at the high school level, had slowed,” said Tom Vander Ark, the executive director of education for the Seattle-based Gates Foundation.

Funding resumed last November, after a new superintendent took over and Gates officials who visited Coventry returned convinced that things were back on track.

Thomas Richards, the chairman of the Coventry school committee, points out that many of the teachers and midlevel administrators who were carrying out the grant-financed efforts had never left. But he adds that he doesn’t begrudge the foundation’s wariness.

“They just wanted to make sure the money was going to be spent as we said it was,” Mr. Richards said.

Undue Influence?

In Pittsburgh, foundation officials didn’t wait for a change in district leadership before taking the dramatic step of freezing financial support for the 38,000-student system—and making a public show of doing so.

The joint decision last July by the Grable Foundation, the Heinz Endowments, and the Pittsburgh Foundation cut off funding for district efforts aimed at improving students’ literacy skills. (“Freeze on Grants Roils Pittsburgh District,” Aug. 7, 2002.)

Discord among Pittsburgh school board members and Superintendent John W. Thompson in recent months has prompted mediation efforts by outside consultants and calls by some local leaders for state intervention to change the board’s makeup.

In an open letter explaining their decision, the foundations called on district officials to shape up. “As investors,” they wrote, “we can no longer be confident that any funds we put into the district will be used wisely.”

City leaders responded by naming a 38-member citizens’ panel to draft a district improvement plan that includes ways of improving relations among the system’s leaders. While awaiting the panel’s report, due in April, foundation executives have praised the effort and pledged that they’re open to renewing their support should the governance problems get solved.

But in leveraging their influence, foundations open themselves to charges of heavy-handedness.

That’s what has happened in San Diego, where several foundations have made grants to the 140,000-student district with the understanding that the money could be pulled should there be a change in leadership. Broad, Gates, Hewlett, and Atlantic have made donations totaling more than $30 million to the district with such conditions.

The grants are especially controversial in San Diego because Superintendent Alan D. Bersin has a one-vote margin of support on the five-person school board. (“Teachers Seek School Board Overhaul,” Oct. 30, 2002.)

Opponents of Mr. Bersin’s policies have complained that the grants send a message to voters that a change in the school board majority could imperil millions of dollars in private funding.

“It’s basically a political activity,” said John de Beck, a school board member and a vocal critic of Mr. Bersin. “What you’re doing is guaranteeing the political appointment of a superintendent.”

Although Mr. de Beck won re-election last fall, the issue resurfaced with the recent news that Mr. Bersin planned a diminished role for Chancellor of Instruction Anthony Alvarado, the chief architect of San Diego’s school improvement efforts.

The same grants that were given with the expectation that the superintendent will stay put also name Mr. Alvarado as a key player who needs to remain.

But Mr. Bersin has gotten assurances from the grantmakers that their support likely will continue. Mr. Alvarado will work as a part-time adviser to the district through September, according to changes in his contract approved last week by the school board.

Mr. Bersin said the decision to try to keep Mr. Alvarado on, in at least some capacity, was not influenced by the grants. “It’s based on the merits of what’s good for the district,” he said in an interview. “The money is not a determining amount in the context of the overall budget.”

Foundation officials say they’re confident that the superintendent will pursue the same policy agenda.

“If Alan had given me an indication that he was going to do something different, that there would be a change in direction, then there would have been some concern,” said Mr. Vander Ark of the Gates Foundation. “The issue is not so much the people as it is the plan.”

‘We Have Discretion’

Alan Ruby, a senior vice president with Atlantic Philanthropies, an international organization whose main U.S. office is in New York, struck a similar tone: “This grant is conditioned on Bersin and Alvarado staying in leadership roles in San Diego. We have discretion in how we interpret that.”

Most foundation officers agree that a change of leadership in a district needn’t mean sudden death for their grants. Instead, they say, it’s a reason to step back and evaluate whether the turn-over is likely to undermine their efforts. To be sure, canceling a grant in midcourse hardly serves a philanthropy’s interests.

“We have to figure out, how do we minimize the impact of leadership transition?” said Richard Laine, the deputy director of education at the New York City-based Wallace-Reader’s Digest Funds.

The foundation has experienced the inevitability of turnover firsthand. A year ago, Wallace-Reader’s Digest awarded grants to 10 districts to strengthen their efforts at leadership development.

Since then, the superintendents in four of those systems have either moved on or announced plans to do so.

And yet, Mr. Laine says he isn’t worried. The foundation kept in close contact with the districts as they chose new superintendents, he said. And all but one district, which is still searching, picked a local school official to fill the job.

Indeed, Mr. Laine points out, a major aim of the Wallace grants is to find ways to adequately support whoever is in charge so that a district can weather such changes.

“If we bet on the superhero,” he said, “we’re basically saying we’re at the whim of a transition we know is coming.”


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