Foundation still raising funds to keep BCG

by on Jun 06 2012

The William Penn Foundation is trying to raise more money so the Boston Consulting Group can continue working with the School District on its budget and transformation blueprint. The foundation's leader said that the company’s expertise is essential – despite continued community hostility to the arrangement.

“I am still speaking to others about helping to keep [BCG] until we have more capacity within the District to run operations,” said William Penn president Jeremy Nowak.

So far, the foundation has raised $2.7 million for outside consulting for Chief Recovery Officer Thomas Knudsen and the School Reform Commission, almost all of which has gone to BCG. But that money is about to run out, Nowak said.

William Penn itself has been the largest donor at $1.45 million, which paid for five weeks of work. Nowak said he raised another $1.2 million from six organizations and individuals.

The United Way of Southeastern Pennsylvania, which serves as a fiscal conduit for donations to support BCG's work, disclosed the amounts of some of the contributions Tuesday, in response to an inquiry from the Notebook two weeks earlier:

PSP executive director Mark Gleason declined to identify the donor or donors who gave funds for the purpose of supporting BCG, but said that his organization may contribute more in the future.

“The board has authorized more if we feel the need is there and the conditions are right,” wrote Gleason in an email. “We are raising funds for this purpose, yes, but are not in a position to reveal the donors at this time.”

O’Neill, the largest identified individual donor to the effort, was one of the prime movers behind the formation of PSP and has been a generous donor to Catholic schools.

The total from Vanguard and the anonymous donor is $275,000; Vanguard’s company policy is not to disclose contribution amounts.

All of the $1.2 million is being directed to BCG through the United Way.

United Way president Jill Michal said the organization’s role is limited to being the “fiscal agent, ” noting that her organization agreed to play this role and contribute funds because it is important to help the District figure out its future direction.

“This is an organization in tremendous need of a real business plan and assistance in trying to develop a long-term strategy and get out of the flavor-of-the-month reform mode,” said Michal.

“In many organizations, sometimes you need outside eyes to help you do that, to step away from work you’re in and look at things that have worked or failed on a national level.”

But while the United Way is paying BCG, the company’s “scope of services” is being supervised through William Penn, said Michal.

Nowak has said that he is part of a steering committee advising Knudsen.

Donors are “happy with the quality of [BCG’s] work,” wrote Nowak in an email.

SRC chairman Pedro Ramos has credited BCG with bringing back the District, which needed to close a $700 million budget gap this year, “from the brink of insolvency.”

The SRC had a contract with BCG for the first five weeks, but there is nothing in writing regarding its continued work.

Ramos dismissed any concerns about that arrangement.

“What we're getting is support, which is not the same thing as control,” he said.

“We have lots of in-kind support all the time, we have pro bono help sometimes, we have people volunteering on all types of activity. This is something that's funded by philanthropy to support the District, and it's provided a capacity that the District wouldn't have otherwise had in the last six months.”

The blueprint unveiled by Knudsen, which would divide the District into “achievement networks” run by outside entities and close 64 schools over five years, has run into stiff opposition. Plans to pilot one of the networks next year have been postponed, and the District says it is seeking more public input before proceeding with that portion of its plan.

At last week’s contentious School Reform Commission meeting, Ramos responded to persistent questioning during public testimony by saying the District would release a “work product” from BCG in the next few weeks.

Most of BCG’s work to date, Ramos said, has been “supporting our CRO in stopping this School District from going insolvent because of the actions that were taken in the past by folks who wanted to give you what you wanted to hear instead of taking the actions they should have taken.”

Disclosures: The William Penn Foundation is a major funder of the Notebook. The Notebook is working with the Philadelphia School Partnership on a new initiative to provide more information to parents about city schools.