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Children First Fund gave thousands on Ackerman's way in, too

By Benjamin Herold on Aug 31, 2011 03:44 PM

by Benjamin Herold
for the Notebook, WHYY/NewsWorks

The same charitable foundation that is funneling $405,000 in controversial anonymous donations to support the buyout of departed Philadelphia schools superintendent Arlene Ackerman also gave the District $150,000 to support Ackerman’s arrival.

Over $10,000 of that money, which was used to create a “CEO’s Transition Fund” to cover expenses related to Ackerman’s transition team, went directly to Ackerman herself.

The foundation, Philadelphia’s Children First Fund, has come under considerable scrutiny in recent weeks following the revelation that it had been used as a pass through for anonymous donations used to help buy out Ackerman’s contract. Some state legislators, the good government watchdog group Committee of Seventy, and Ackerman herself have called for the names of the donors to be made public.

“Secrecy has huge potential downsides,” said Zack Stalberg of the Committee of Seventy last week. 

To date, however, PCFF has not given any inclination that it intends to reveal the identity of the donors. The foundation’s executive director, Jeanne-Marie Hagan, did not respond to multiple requests for comment. 

Mayor Michael Nutter, who acknowledged personally soliciting some of the buyout contributions, has defended the right of donors to give anonymously.

“If someone want to remain anonymous, that is their choice,” said Nutter.

His office did not answer a series of questions about how the fundraising proceeded.

"The mayor said what he had to say about it on the day of the announcement," said Nutter spokesman Mark McDonald. "He spoke to the issue at some length. He clearly wanted to minimize the public dollar outlay and said he agreed with the [PCFF] approach."

McDonald referred all questions to the Fund.

In addition to the identities of the donors, there are lingering questions about whether it is permissible under IRS rules governing nonprofits to solicit tax-deductible donations meant for an individual rather than an entity.

In addition, Ackerman was, until recently, a member of PCFF’s board. The IRS also has rules relating to activities that substantially benefit one of its board members.

The $150,000 to support Ackerman’s transition team was given to the District in October of 2008. 

The original SRC resolution (SRC-8) authorized acceptance of the grant and creation of the transition fund. It called for the money to be used to pay for “travel, meals and hotel expenses incurred as a direct result of the Transition Team providing such consultative services to the School District” and provided stipends of up to $1,000 per day to members of the transition team.

The original resolution was superseded three weeks later, however, by an amended resolution, SRC-11, approved on June 18, 2008.  

The changes appear to have been designed to allow for more money to go directly to Ackerman. For example, the amended resolution specified that payments need not be limited to the work of the transition team and authorized payment to Ackerman for “consultative services she rendered during the period from March 1, 2008 through May 31, 2008.”

Ackerman was named CEO in mid-February and her tenure as superintendent officially began on June 1, 2008.

District spokesperson Fernando Gallard said that Ackerman herself was ultimately paid $10,622.51 from the fund, but could not immediately provide a breakdown of the expenses. He said that $141,486.19 of the $150,000 was spent.

Sandra Dungee Glenn, the SRC chairwoman at the time, was required to approve any expenditures. On Wednesday, she defended the work of the transition team, but declined to provide further detail about its funding.

“The transition team was intended to help Dr. Ackerman assess the status of the District,” said Dungee Glenn. “To the best of my knowledge, they produced a report for Dr. Ackerman.”

Among the two dozen individuals involved in the transition team’s work were:

  • Lori Shorr, Mayor Nutter’s chief education officer
  • Donna Cooper, a policy advisor to then-Governor Ed Rendell
  • Robert Peterkin, director of Harvard’s Urban Superintendents’ Program
  • Dan Katzir, managing director of the Broad Foundation
  • Eloise Brooks, former chief academic officer of the San Francisco Unified School District, where Ackerman was previously superintendent
  • Jerry Jordan, president of the Philadelphia Federation of Teachers

Also involved were the two candidates who had just lost out to Ackerman for the Philadelphia superintendency: Leroy Nunery and Kent McGuire, then the dean of Temple University’s College of Education. McGuire and Peterkin co-chaired the group.

The Philadelphia Inquirer reported at the time that about half of the participants turned down their stipends.

According to District records, Nunery was not among them.

At the time, Nunery was running his own boutique management consulting firm, PlusUltre. District records show he was authorized to receive up to $8,000 and ultimately was paid $4,128.78 for his work.

At the time, Helen Gym, founder of Parents United for Public Education and a member of the Notebook’s leadership board, criticized spending money on a transition team charged with assessing the District’s strengths and weaknesses.

“It’s not a matter of what do we know. It’s a matter of what we’re going to do about what we know,” Gym told the Inquirer in April 2008.

Wednesday, Gym said PCFF’s decision to fund both the transition team and the buyout package have raised eyebrows.

“It confirms some suspicions that people have been raising from the beginning about the role of the foundation, the use of its money, and who is actually benefiting,” said Gym.

PCFF was established in 2003, when former CEO Paul Vallas was in charge of the District and James Nevels was chair of the SRC. Its stated mission is to “facilitate individual and organizational giving to create a permanent source of philanthropic capital to the School District of Philadelphia, its leaders, its teachers, and its students.”

PCFF is located in Center City. Its board of trustees is led by Sheldon Bonovitz, the chairman emeritus of the Duane Morris law firm, where SRC chairman Robert Archie is a partner.

Archie also currently serves on the board of PCFF, as does Nunery. According to the foundation’s 990 tax filings with the IRS, both men – and Ackerman – joined the board sometime between July 1, 2009 and June 30, 2010.

Ackerman is not listed as a current board member on the foundation’s website.

Between July 1, 2008 and June 30, 2009, tax records show, PFCC gave out $1,843,359 in grants, all to the School District of Philadelphia. 

All non-profit organizations and charitable foundations are required to file 990 forms with the IRS. They are not required to list their donors.  The forms can be accessed online for free at www.guidestar.org, among other places.  

Last week, Bryn Mawr attorney Mark Schwartz said he has requested that the Internal Revenue Service (IRS) investigate PCFF for its role in facilitating Ackerman’s buyout.

“As a citizen, I am just outraged by this incredible waste of resources,” said Schwartz. “I think the IRS needs to look into this charity, disallow the deductions taken by individual donors and disallow the tax exemption of Philadelphia’s Children First Fund.”

IRS spokesperson Mark Hanson said he could neither confirm nor deny whether any investigation has been initiated.

“If a taxpayer contacts us with a complaint, the agency will take a look and act accordingly,” said Hanson.

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Comments (23)

Submitted by Anonymous (not verified) on August 31, 2011 6:33 pm

Surprise, surprise! Give me a break! Nothing surprises me when it comes to Ackerman!

Submitted by Anonymous (not verified) on August 31, 2011 7:31 pm

Somebody please investigate this. We just seen Kenny Gamble being ushered into 440 N Broad this late in the evening and greeted by SRC Chairman Archie and taken to a meeting at the SRC's Chairman's office. We're pretty sure that the days of MLK are numbered... they are cutting the bacon and giving the biggest slab to Gamble...

Submitted by Anonymous (not verified) on August 31, 2011 9:32 pm

Yes, but Gamble is such a fine educator and fellow--just ask ANYBODY in Point Breeze. What a bunch of crap!!!

Submitted by J Taylor (not verified) on August 31, 2011 7:27 pm

I'd love to see a list of who got what money for the transition. It's locking the barn door after the horse is gone, I know, but maybe close scrutiny of this will make us wiser about the next selection process. Of course, as a PFT member, I'm hoping that Jerry Jordan did not accept money for the transition.

Submitted by J Taylor (not verified) on August 31, 2011 7:33 pm

And perhaps everyone involved in the selection could keep in mind that the SDP is not a business. We should be operating as a non-profit organization. Our goal is to deliver services. Administrative salaries should be subject to the rigorous review that other non-profit organizations need. There are many competent people who will work for compensation that falls far short of what many of Ackerman's crew received...beginning with the top spot.

Submitted by Ms. Chips (not verified) on August 31, 2011 7:33 pm

This is stunning. What hubris. I hope this story ends the careers of everyone involved.

Children first? As in the fatuous core beliefs?

How dare they!

Submitted by Anonymous (not verified) on August 31, 2011 8:29 pm

are teachers getting their step raise?

Submitted by Anonymous (not verified) on August 31, 2011 9:29 pm

Disgusting!

Submitted by Anonymous (not verified) on August 31, 2011 9:18 pm

Ackerman wants it investigated? Oh, really? Why doesn't she GIVE IT BACK THEN.

Submitted by Anonymous (not verified) on August 31, 2011 10:35 pm

My point exactly. Playing the race card to cover their OBVIOUS tracks is really lame.

Submitted by Anonymous (not verified) on August 31, 2011 11:58 pm

Gamble doest need the money!!!!

Submitted by Anonymous (not verified) on August 31, 2011 11:36 pm

Henry Ford once said, "You can never have enough money.', Moron !!

Submitted by Anonymous (not verified) on September 1, 2011 7:05 am

Who took the "honorarium" and who turned it down? It says "about half" here and "about half" in the original Inqy article. I would really like to know if people working for the district, state government, and Jerry Jordan took a bunch of money from a non-profit to do what is already their job.

Nunery is as bad as the last crook-in-chief.

Submitted by Helen Gym on September 1, 2011 9:00 am

I'd be curious to see the report published by the transition team.

Submitted by Anonymous (not verified) on September 1, 2011 1:02 pm

Absolutely everything about this, Ackerman's buyout and years of health insurance, the $440,000 yearly salary for her personal PR people, and this information about the money spent when she first arrived, stinks. And this doesn't even begin to deal with the dumbed down, scripted curriculum she installed to the tune of millions of dollars going to private companies and the fact that our young people and their teachers who had to put up with it. Everyone associated with her continued employment and her buyout should be forced to step down.

Submitted by Anonymous (not verified) on September 1, 2011 4:21 pm

Yes, the Queen said emphatically that a contract is a contract. Funny, she didn't seem to regard the PFT Contract as a contract.

Submitted by tchr16 (not verified) on September 3, 2011 8:20 am

She doesn't keep her word. Her head is too big. Notice she's been quiet lately? She said a little too much, now she is being investigated for breaking the buyout agreement. I hope she looses it ALL!

Submitted by Ms. Chips (not verified) on September 1, 2011 3:50 pm

Ben, this is a haunting story. It's like a tangle of yarn, anywhere you pull you find a connection, & it never gets completely unknotted. This era of thievery is more than politics as usual if only that so many funding streams are involved

There must e a way to kick this story & what it leads to into investigation, before it gets hidden in Philadelphia's culture of apathy. .Since the relationships are incestuous in being so interconnected, and the sizable amounts lead to other misuses of money going to the same people, do the racketeering laws apply?

Submitted by Anonymous (not verified) on September 1, 2011 6:14 pm

EVERY person who was involved in this should be fired. Guess why we have no credibility? With slithering types like Archie and Yes, Nutter too, sliming around, ain't nobody goin to take us seriously. The only good thing is putting Ackermania in the rear view mirror. It will take at least a full year to clean up after her deliberate chaos, carpetbagging and bigotry. The only consoling point is that she did everything "For the children."

Submitted by Bill Hangley (not verified) on September 2, 2011 7:42 am

RE: Archie, Gamble and MLK - - anyone who'd like to share their thoughts on a possible Gamble/MLK connection can contact me at billhang@msn.com - - confidentiality guaranteed!

Submitted by Anonymous (not verified) on September 2, 2011 1:27 pm

Mr. H.

What is the status of the Evans/Archie?Nunnery and Foundations investigation?

Submitted by Anonymous (not verified) on September 2, 2011 11:24 pm

I think any desisions that the arc and Ackerman made while she was here should all be rescinded example universals takeover of vare and audenried

Submitted by Arlene (not verified) on August 24, 2014 6:21 am

 And this doesn't even begin to deal with the dumbed down, scripted curriculum she installed to the tune of millions of dollars going to private companies and the fact that our young people and their teachers who had to put up with it.

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