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Complaint Regarding Potential Lobbying Activity
by the Philadelphia School Partnership (PSP)



On behalf of Parents United for Public Education, we request for the City’s Board of Ethics to investigate
potential lobbying activity by the Philadelphia School Partnership (PSP), particularly those activities
connected to PSP’s role in the public‐private "Great Schools Compact.” PSP first registered as a lobbyist on
September 12, 2013, and stated that it began lobbying as of August 1, 2013. However, evidence suggests
that PSP engaged in a significant amount of earlier lobbying without registering or reporting as has been
required by law since January 3, 2012. In particular, we are concerned that PSP appears to be 1) lobbying on
matters where they or their donors or board members have a financial interest; 2) lobbying through a non‐
public entity, which is not a “task force” or similar body controlled by the School District or City, under the
guise of pursuing ‘disinterested common goals’; and 3) lobbying in the course of making conditional grants to
public entities such as individual schools or the District.

Background: Philadelphia Schools Partnership

The Philadelphia Schools Partnership (PSP) is a private nonprofit organization created in 2010 and publicly
launched in 2011. PSP’s goal – by its description – is to “accelerate the pace of education reform in
Philadelphia by increasing the number of great school options available to children in our city” and “raise
philanthropic funds and invest those funds in school operators and people that have the ability to create and
maintain great schools across Philadelphia.”
1
In 2012 the William Penn Foundation awarded a $15 million
grant to PSP. The William Penn grant committed PSP, over a three‐year period, to “create 18,000 high‐
performing Kìndergarten‐12th grade seats, in schools managed by high quality operators....”
2
PSP has now
raised $65 million of a $100 million target for its Great Schools Fund, which according to a PSP press release
“pools philanthropic dollars from a diverse group of funders to strategically invest in the incubation, startup,
expansion and transformation of high‐quality schools across Philadelphia.”
3


A number of PSP’s current and past board members
4
and known funders
5
have direct stake in organizations
and policies supported by PSP’s philanthropic “investments,” such as charter school expansion (including
construction, management, or investment in charter schools and related contracts) and Pennsylvania’s
voucher‐like “tax credit scholarship” program which trades tax breaks for corporate donations, which are
then given to select students to defray the cost of their private ‐ generally Catholic ‐ school tuition (it is
believed that PSP has sought or considered seeking recognition as an organization that can receive such
funds).
6
PSP is housed in the offices of an architecture firm, Blackney Hayes, whose business involves
developing facilities for charter schools.
7
PSP shares this space with a partner organization,
8
PennCAN (part of


1
PSP is part of a national network called CEE Trust, which stands for “Cities for Education Entrepreneurship.” See http://www.cee‐trust.org/.
2
Grant Award Contract between William Penn Foundation and PSP, July 18, 2012. The contract commits PSP to meet annual dollar targets for
“investment” in “in the incubation, start‐up, expansion, and turnaround of schools in Philadelphia,” as well as annual targets for creation of
new “seats.” Exhibit I.
3
See http://www.philaschoolpartnership.org/news/107‐psp‐receives‐5‐million‐challenge‐grant‐from‐walton‐family‐foundation.
4
See http://www.philaschoolpartnership.org/about‐us/board‐of‐directors. Past board members have included Scott Gordon of Mastery
charter schools, David Hardy of Boys Latin charter school, and Jeremy Nowak of The Reinvestment Fund and later the William Penn Foundation.
5
PSP does not disclose all of its investors, nor the amount of their investments. See http://www.philaschoolpartnership.org/great‐schools‐
fund/investors.
6
See http://www.nytimes.com/2012/05/22/education/scholarship‐funds‐meant‐for‐needy‐benefit‐private‐schools.html?pagewanted=all
(“Some of the programs have also become enmeshed in politics, including in Pennsylvania, where more than 200 organizations distribute more
than $40 million a year donated by corporations. Two of the state’s largest scholarship organizations are controlled by lobbyists, and they
frequently ask lawmakers to help decide which schools get the money, according to interviews. The arrangement provides a potential
opportunity for corporate donors seeking to influence legislators and also gives the lobbying firms access to both lawmakers and potential new
clients.”) One of the lobbyists referred to by the New York Times, Chris Bravacos of the Bravo Fund, is a PSP board member; another PSP board
member, Evie McNiff, founded the Children’s Scholarship Fund.
7
See http://www.blackneyhayes.com/index.php?page=portfolio.
2
a national network called 50CAN); while PennCAN is registered as a nonprofit, it appears to spend the
overwhelming majority of its time engaged in state‐level lobbying and legislative advocacy aligned with PSP’s
objectives.

Background: The Great Schools Compact

The “Great Schools Compact” is a public‐private agreement that was signed in December of 2011. Signatories
are a mix of officials from the City, State, District, and charter schools.
9
The Compact’s terms and structure
were designed to meet parameters set by the Gates Foundation, which selects cities that have adopted
district‐charter collaboration compacts that meet Gates’ specifications as subsequently eligible to compete
for multi‐million dollar grants.
10
Gates’ Compact effort is managed at the national level by the Center for
Reinventing Public Education (CRPE), which provides guidance and monitoring to Compact entities in order to
advance Gates’ core priorities.
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The Compact agreement includes the following commitment to establish a “Compact Committee”
12
:
No later than 45 days after the signing of this Compact, the undersigned will establish a committee
(the “Compact Committee”) to assist in the implementation of the Compact. The Compact Committee
will have three members appointed by the District, three, collectively, by PCPCS [Pennsylvania
Coalition of Public Charter Schools] and PCE [Philadelphia Charters for Excellence], and one by M/OE
[Mayor’s Office of Education]. PDE [Pennsylvania Department of Education] will appoint one member,
and two non‐voting seats shall be made available for representatives of business and philanthropy.

The Compact Committee is not controlled by the City or School District. Rather, it exists by collective
agreement of the Compact’s signatories and makes decisions by vote of its members – for example, the
chairperson for the Compact Committee, Philadelphia Chief Education Officer Lori Shorr, was selected by
vote of the Committee membership.

According to PSP’s website, PSP serves as the “facilitator” and staff of the Compact Committee, as well as
serving as the applicant for grants on behalf of the committee and as its “fiscal agent.”
13
The Gates
Foundation provided a early direct grant to PSP to “support the work of the Compact Committee”; according
to PSP’s published notes, those initial funds were “intended to indirectly benefit schools through the


8
PSP’s leadership encouraged 50CAN to expand its footprint to Pennsylvania, leading to the creation of PennCAN. PSP Board of Directors
Meeting Minutes, March 6, 2012. Exhibit II.
9
See Exhibit III.
10
“The Philadelphia Great Schools Compact,” presentation by Dr. Lori Shorr to the SRC on November 16, 2011, available online at
http://thenotebook.org/sites/default/files/SRC%20Compact%20Presentation%2011‐16‐11%20v2.pdf. See also: “Charter Collaboration Driven by
Chance at Gates Money,” The Philadelphia Public School Notebook, November 16,2011, available online at
http://thenotebook.org/blog/114254/charter‐cooperation‐driven‐chance‐gates‐money. It is believed that Philadelphia’s “Compact” was revised
to better meet Gates Foundation specifications. See “Gates: Philly charter ‘Compact’ not ready ‐ yet,” The Philadelphia Public School Notebook,
December 7, 2011, available online at http://thenotebook.org/blog/114332/gates‐philly‐charter‐compact‐not‐ready‐yet.
11
See http://www.crpe.org/portfolio/district‐charter‐collaboration and http://www.crpe.org/portfolio/districts/philadelphia.
12
The list of current voting and nonvoting members of the Great Schools Compact Committee are listed on PSP’s website as:
 Dr. Lori Shorr, Chief Education Officer, Mayor’s Office of Education
 Casey Carter, CEO, Faith in the Future Foundation [Catholic schools]
 Joe Dworetzky, Commissioner, School Reform Commission
 Dr. Naomi Johnson‐Booker, CEO of Global Leadership Academy [Charter]
 Lawrence Jones, CEO of Richard Allen Preparatory Charter School [Charter]
 Paul Kihn, Deputy Superintendent, School District of Philadelphia
 Wendell Pritchett, Commissioner, School Reform Commission
 David Rossi, CEO of Nueva Esperanza Academy [Charter]
 David Volkman/Dale Hamby, Office of the Pennsylvania Secretary of Education
 Carol Cary, Superintendent of Secondary Schools Archdiocese of Philadelphia, Office of Catholic Education [nonvoting]
 Mark Gleason, Executive Director of the Philadelphia School Partnership [nonvoting]
 Scott Gordon, CEO of Mastery Charter Schools [nonvoting]
13
See http://www.philaschoolpartnership.org/philadelphia‐great‐schools‐compact/.
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recommendations of the Committee but will not be available for direct grants to schools.”
14
There is
evidence that the Compact did not initiate with the City or District; PSP wrote in a 2012 grant proposal to the
Gates Foundation that “PSP convened the parties and facilitated the collaboration that resulted in the Great
Schools Compact and has been designated by the Compact Committee as the Compact’s project manager.”
15


In January 2012, City and District officials ‐ together with PSP representatives and the PA Coalition of Charter
Schools – travelled to Denver, Colorado, to see that city’s Gates‐funded Compact‐related initiatives.
16
The trip
was funded by the William Penn Foundation, though it is not known who suggested or initiated and
organized the trip.

The Great Schools Compact meetings are private and not open to the public. PSP publishes “updates” from
these meetings,
17
usually with a few‐month delay, but these updates are abbreviated and differ from the
official “minutes” of the Committee. The actual minutes have never been publicly released, but copies of
minutes from several meetings have been obtained
18
and are included with this complaint. These minutes
show discussions between PSP and District officials regarding pending policy decisions such as charter
renewals and expansions, and what a restructured District Charter Office should look like.

Several “working groups” have been created composed of both Great Schools Compact members (including
City and District officials) and individuals from non‐member organizations. However, membership lists for
the working groups are not publicly available, and some non‐member organizations have been required to
sign confidentiality agreements as a condition of participating. It is possible that the Compact’s structure and
activities may implicate other individuals and organizations in potential lobbying violations in addition to PSP.
It is impossible to know the full scope of potential lobbying activity without public access to the Compact
Committee’s meetings or their unedited minutes.

PSP’s Involvement with the Compact Committee Includes Advocacy to City and District Officials

The Compact Committee’s grant submissions to the Gates Foundation, which were drafted by PSP, reflect
discussions within the Compact committee and its working groups regarding numerous potential District
policy decisions – including decisions in which PSP and other Compact members have a direct or indirect
financial interest. The full proposals from PSP (on behalf of the Compact) to the Gates Foundation have not
been publicly released despite media requests, although a copy of one such submission was obtained and is
included with this complaint.
19


A grant application, which PSP submitted on behalf of the Compact to the Gates Foundation in May 2012,
proposes that the District adopt several controversial policies that had not yet been deliberated or approved
by the SRC, and requests funding to pursue those policies. Although this specific proposal appears to have
been rejected by the Gates Foundation and funded in a more limited capacity, clearly each of these areas was
being discussed among Compact members and PSP staff, where PSP and other private Compact members


14
See “Second Meeting,” http://www.philaschoolpartnership.org/philadelphia‐great‐schools‐compact/updates?start=25 (not a permalink).
15
“Philadelphia Great Schools Compact Proposal to the Bill & Melinda Gates Foundation for a Grant to Support Citywide Collaboration Between
School Providers,” May 1, 2012 at p. 5. Exhibit IV. PSP’s Board minutes from June 14, 2011 record PSP’s early role in shaping the Compact with
City and District officials: “Mr. Gleason then reported on the compact. PSP has been meeting with key people from the Mayor’s Office, the SRC
and the School District to hammer out an agreement to sketch out a reform path that will create a system of quality choices.” Exhibit V.
16
See http://thenotebook.org/blog/124397/hoping‐glimpse‐future‐city‐schools‐nutter‐and‐src‐head‐denver.
17
See http://www.philaschoolpartnership.org/philadelphia‐great‐schools‐compact/updates.
18
Non‐public documents that are referenced and/or attached to this complaint were obtained from former employee(s) of organization(s)
involved with the Great Schools Compact. Effort has been taken to represent where a document is known to be a draft, but documents’ status
as final is not confirmed.
19
“Philadelphia Great Schools Compact Proposal to the Bill & Melinda Gates Foundation for a Grant to Support Citywide Collaboration Between
School Providers,” May 1, 2012. This document also includes as its own Appendix F (pp.68‐92) an earlier submission to Gates, “Concept Paper
Submitted to the Bill & Melinda Gates Foundation ‐ PROGRAM‐RELATED INVESTMENTS FOR SCHOOL FACILITIES ‐ Leveraging Building Assets &
Financing to Yield Quality Schools,” March 30, 2012. Exhibit IV.
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advocated behind closed doors for their desired policies specifically to City and District officials.
20
These are
described at some length, and include:

 School closures and new school openings. The proposal states that “Through the Compact
Committee, the SRC and charter schools have discussed targets for seat quantities within each of
these strategies [“a combination of turnarounds, closures, school expansions and new schools”]....”
These decisions implicate PSP’s interest as a funder of new and turnaround schools (district‐to‐
charter conversions), as well as the interests of PSP board members who run or invest in charter
schools and turnaround management. PSP board members are also involved with Catholic schools,
including the founding of new “independent” Catholic schools, which have benefited in increased
enrollment following the closure of District schools.
21


 Changes to how school “performance” is measured for both District and charter schools, including
which factors are weighted most heavily. This formula influences whether schools get additional
funding, or are subject to “turnaround” interventions or even closure. It also influences the outcome
of charters’ requests for expansion or renewal.

 Creation of an official “school choice” information resource, GreatPhillySchools.com, which is now
managed and controlled by PSP.

 Creation of a “universal enrollment system,” for school applications across District, charter, and
Catholic schools, now proposed to be managed and controlled by a PSP‐created private entity. The
proposed entity would have a paid contract with the District and individual charter schools.

 Creation of a restructured District Charter Office, the entity responsible for authorizing and
monitoring Philadelphia charter schools. The proposal states, “The Compact Committee has begun to
work on a blueprint for a reimagined Office of Charter Schools, one that sees charter schools as its
primary constituents….” Almost no information has been made public about these plans, but rumors
and non‐public documents suggest that PSP has advocated an office that is controlled by the charter
schools themselves, with staff funded by dues paid by the charter schools.

 Funding for encouraging use of “blended” or “distance” learning in District and charter schools,
which PSP has publicly advocated as reducing the number and cost of teaching staff within schools,
and which would involve contracts for computer software and hardware.

 Creation of a principal training program for people who may have limited background in education.
The program was incubated by PSP, and then spun off into a new private nonprofit agency believed
to be run by PSP and managed by The New Teacher Project (TNTP). The program launched in the
spring of 2013, and may receive District funds.
22
It is intended to create a leadership pipeline of
individuals who are oriented towards a particular management approach that is supported by PSP.


20
Meeting minutes from March 30, 2012, and April 18, 2012, show PSP presenting to the Compact Committee highlights from grant proposals
PSP drafted and planned to submit to the Gates Foundation on behalf of the Committee. The March minutes show that PSP briefed the Compact
Committee on a proposal it planned to submit later that very same day, which included a request for a $20 million forgivable loan that would be
controlled by PSP. Exhibits VI and VI.
21
See http://axisphilly.org/article/a‐new‐day‐for‐an‐old‐school/, reporting that the privately‐run Catholic “Independence Mission Schools” have
seen an increase of 1,100 students this year, many from closed District schools, out of a total enrollment of around 4,100 students. Both the
Independence Mission Schools and another private organization that has taken over management of Catholic high schools, the “Faith in the
Future Foundation,” were founded in 2012 with strong involvement of PSP board member and founder Michael O’Neill and his family, and have
received funding from PSP.
22
It is unclear whether this principal training program, known as PhillyPLUS (“Pathways to Leadership in Urban Schools) and operated by The
New Teacher Project (TNTP), has been specifically approved or funded by the SRC. TNTP has had a contract with the District for several years,
providing administrative funding for an alternative teaching certification program known as the Philadelphia Teaching Fellows. In December
2012, the SRC voted to approve a contract with TNTP for $805,000, with the resolution language referring to the Teaching Fellows but not
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 Adoption by the District of a program of “Teacher‐Effectiveness Training” developed and
administered by Mastery Charter Schools.
23


 Pricing and incentives to help charter schools to move into closed District school buildings. The May
2012 proposal references and includes an earlier March 2012 proposal from PSP to the Gates
Foundation, on behalf of the Compact, which focused specifically on creating a program to give
charter schools special access to surplus District properties. The proposals suggest that the district
give charter schools reduced pricing, and ask for funding to create a (forgivable) loan pool for charter
school acquisition of District properties, which would be managed and controlled by PSP. Attached
to the grant submission are numerous letters of support from charter school operators, advocating
for the reduced pricing and zero‐interest financing for District building acquisitions. This proposal
includes as a partner the for‐profit Canyon Agassi Charter School Facilities Fund, which has a financial
interest in the prospect of new charter school construction opportunities in Philadelphia.
24


In all these above policy areas, given the structure of the Compact Committee, evidence suggests that PSP
engaged in advocacy to City and District officials to encourage the adoption of its preferred positions and in
some cases the creation of procurement opportunities for PSP or related entities. That advocacy may have
taken place in Compact Committee or working group meetings, in private discussions, or simply through
PSP’s role in drafting the Gates proposals and seeking approval from the Compact Committee for their
suggested text. Because the Compact Committee is designed to make recommendations for policy and
procurement decisions to the SRC, this advocacy involved issues on which the SRC had not yet deliberated or
voted.

The policy and procurement areas reflected in the Gates proposals and described above are ongoing focuses
of PSP’s advocacy with City and District officials, both within the context of the Compact Committee and
allegedly through direct private communications.

For further detail:
 Discussion of the nature and scope of the private conversations between PSP and City/District
officials through the Great Schools Compact. February 2012 –
http://thenotebook.org/blog/124556/what‐philadelphia‐school‐partnerships‐role‐great‐schools‐
compact

 Concerns articulated by a District source about the District not being adequately represented in the
Compact configuration, underscoring that the Compact is not a District or City‐controlled entity.
March 2012 – http://thenotebook.org/blog/124587/chorus‐concern‐over‐great‐schools‐compact

 Coverage of Compact grant submission to Gates, showing that it is pushing policies that some
members have direct financial stake in, and mentioning that PSP declined to publicly release the
grant when requested by Newsworks/WHYY. June 2012 –
http://thenotebook.org/blog/124942/details‐emerge‐great‐schools‐compact‐plans





mentioning the new principal training program, but this is believed to be a significantly larger grant amount than in prior years. Resolution A‐11
‐ http://webgui.phila.k12.pa.us/uploads/oP/Bl/oPBlTaEXOF4Tt2a7g_‐YcQ/Public‐Resolution‐Summary‐12.20.12‐Final.pdf.
23
Minutes from the Compact’s March 30, 2012 meeting (not publicly released) record plans for communications between City and District
officials and PSP and Mastery regarding the proposal for a potential contracting opportunity for Mastery. Minutes from the Compact’s April 27,
2012 meeting (not publicly released) reference debate and deliberation among attendees regarding the “stigma” and “perceived political
implications” of naming Mastery to run this program. Exhibits VI and VII.
24
The Canyon Agassi fund is a for‐profit investment partnership founded by Andre Agassi and a private equity fund, Canyon Capital, with
Citibank and Intel as core investors. See http://www.bloomberg.com/news/2011‐06‐02/agassi‐forms‐fund‐to‐build‐charter‐schools‐with‐
canyon‐capital.html and http://www.canyonagassi.com/.
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 Reference to private conversations including PSP and City/District officials, regarding plans for a
restructured District charter oversight office. July 2012 ‐ http://thenotebook.org/blog/125028/amid‐
rapid‐charter‐school‐growth‐and‐stunning‐fraud‐charges‐city‐leaders‐consider‐overha

Illustration 1: PSP’s Proposal for a Universal Enrollment System and Contract with the District

A clear illustration of PSP’s advocacy is provided by their proposal to create a private entity to assume control
over a “universal enrollment system” that would privately manage the enrollment and placement of all
students in District, charter, and Catholic schools. On September 18, 2013, PSP gave a powerpoint
presentation
25
to a group of City Council members and staff regarding their plans to create a centralized
application system for District, charter, and Catholic schools, to be called “PhillySchoolApp.” According to the
presentation, this year 50+ charter and Catholic schools would use the system, and “next year” the District’s
200+ schools would join. PSP’s presentation included a timeline, projecting that the new office would be
established and staffed by November 1, 2013, with the application launched and distributed on that date for
enrollment for the fall 2014 school year.

PSP’s presentation states that this universal enrollment and placement system would be controlled and
managed by a private 501(c)3 entity, founded by PSP, which would have contracts with the District and other
participating schools. This entity would not only manage the application process but would control the
determination of what school a student would be allowed to attend. Recruitment of an executive director
for the new entity had already begun, with “interviews under way” as of the date of the presentation.
According to its Council presentation, PSP would raise funds for the first three years of operations through
private philanthropic investment, with the annual budget estimated at $1.5 million. Thereafter, the District
and other participating schools would need to pay a per‐pupil fee each year into the future to use the system,
described by PSP’s Mark Gleason for the purposes of discussion as perhaps something around $10 per child.
The system would use an algorithm owned by another private organization, the “Institute for Innovation in
Public School Choice,” with which it would have a paid contract.

A stripped‐down PhillySchoolApp (www.phillyschoolapp.org) launched on November 8
th
. Although the
website is owned by PSP executive director Mark Gleason,
26
the site makes no mention anywhere of the
Great Schools Compact or the Philadelphia School Partnership.
27


Use of a universal enrollment system across District and charter schools is highly controversial, and has faced
significant criticism in the few cities where it has been implemented. Unprecedented in any city is the effort
to take the endeavor private and to include Catholic schools, which raises separate First Amendment
issues).
28
As noted in PSP’s presentation, the proposed privately‐controlled enrollment system would be
integrated with schools’ data systems, implicating serious privacy and commercial data‐mining questions.

The SRC has not formally deliberated or voted on the specific question of whether to create and participate
in a universal enrollment system, nor on the distinct question of whether such a system should be housed in
a private non‐governmental entity. Based on statements made by PSP at the September City Council briefing,
PSP had hoped to obtain the District’s approval and participation before launching, but had decided to move






25
Philadelphia School Partnership, “Universal Enrollment Overview – City Council – September 18, 2013.” Exhibit VIII.
26
See http://network‐tools.com/default.asp?prog=whois&host=phillyschoolapp.org.
27
http://thenotebook.org/blog/136631/phillyschoolapp‐site‐debuts
28
Minutes from the Compact’s April 18, 2012 meeting (not publicly released) note the controversy: “[Mark] Gleason also confirmed that
Philadelphia is currently the only city that is has included the Archdiocese into the compact agreement and proposal response. [Lori] Shorr
mentioned that there has been a lot of public conversation suggesting that the inclusion of the Archdiocese to the compact is an attempt to
further the voucher agenda.” Exhibit IX.
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ahead with its plans and timeline for the privately‐run enrollment system after the District decided against
participating in the effort.
29
Since then, PSP has declared that plans to launch are delayed for now.

Following a recent exposé of PSP’s universal enrollment proposal on The Philadelphia Public School
Notebook’s website, comments to those posts and on Twitter confirmed that there was no meaningful
advance knowledge of the plans among education stakeholders such as parents, teachers, student groups,
and most education‐related nonprofits. It was also confirmed that PSP had required organizations to sign
confidentiality agreements to participate in the Compact’s advisory “working group” on universal
enrollment.
30


 Coverage mentioning that PSP had met with the District regarding the universal enrollment proposal
as of Spring 2013 – http://thenotebook.org/april‐2013/135800/develop‐common‐application‐all‐
philly‐schools‐groups‐say
o “Philadelphia School Partnership and Great Schools Compact have had discussions with the
District about common enrollment. …. Correction: In the print version of this story (4th
paragraph from the bottom), the article incorrectly stated that the groups have not met with
the District on the issue of common enrollment. The Notebook regrets the error. ”

 Detailed recent exposé of PSP’s push for a privately‐run universal enrollment system. October 2013 –
Part 1 http://thenotebook.org/blog/136578/philadelphia‐schools‐partnership‐pushes‐private‐
management‐student‐placement and Part 2 http://thenotebook.org/blog/136579/how‐universal‐
enrollment‐highlights‐psp‐expanded‐role
o “’There has been no decision made regarding the high school selection process for future
years,’ [District spokesperson Fernando] Gallard wrote in an email. ‘The use of a third party
and the per pupil fee is a question that should be answered by PSP since we are not part of
that effort.’”
o “PSP's communications manager, Kristen Forbriger, in a defense posted last week, stated
that PSP has formed an advisory committee consisting of school operators, District
representatives, and education nonprofits. What she failed to mention is that the members
of the working group, as a condition of joining, signed confidentiality agreements.”
 Post from the Education Law Center, explaining their request for a seat on the
working group, and the signing of a confidentiality agreement ‐
http://thenotebook.org/blog/136604/letter‐explaining‐our‐role‐universal‐
enrollment‐effort

Illustration 2: PSP’s Grants from Its “Great Schools Fund” Involve Negotiation with the District Regarding
School Expansions and/or Private Management Contracts

Following an emerging model for private foundations known as “venture philanthropy,” PSP offers grants
(sometimes called “investments”) with strings attached, which are designed to encourage the District to
make policy and/or procurement decisions that PSP favors. Suggestive details regarding conditions PSP has
sought to negotiate with the District as precondition to providing funds to schools can be found in the
following sources:

 Coverage of PSP’s model of granting funds to drive the creation of “high performing” seats through
conversion to charter management. Note reference to contacts between PSP and District principals.


29
See also discussion of lack of consensus within the Compact Committee regarding the proposed enrollment system reflected in the August
21, 2013 posted notes, available at http://www.philaschoolpartnership.org/philadelphia‐great‐schools‐compact/updates (not a permalink).
30
After public pressure, PSP recently released a list of ‘working group’ members, posted here:
http://thenotebook.org/sites/default/files/Philadelphia‐Great‐Schools‐Compact‐Universal‐Enrollment‐Working‐Group‐List.pdf
8
August 2012 – http://articles.philly.com/2012‐08‐24/news/33343420_1_psp‐philadelphia‐charter‐
school‐catholic‐schools
o “PSP wants to directly fund the creation of 35,000 high‐performing seats in the city and
‘indirectly contribute to the transformation of at least 15,000 additional high‐performing
seats through changes in policies and practices inspired by the fund's investment and related
activities,’ according to foundation literature. …. Gleason said the organization was ‘in the
middle of promising conversations’ with some district principals about possible grants for
expansions. He said it had been tough to make headway in a big bureaucracy that
historically does not empower principals to seek grants and plan for growth.”

 PSP’s Board minutes from November 18, 2010
31
record PSP’s intention to influence the District’s
selection of “turnaround” school operators, who are chosen through a competitive process, by
issuing grants to preferred candidates before the District has awarded the relevant contract.
o “Mr. [Benjamin] Rayer [interim director of PSP] agreed, but said the other reason to get
answers out before the School District decides will pressure the District to make quality
choices. Mr. [Scott] Gordon [of Mastery Charter Schools] said you could also accomplish this
by calling the school District and providing them advance notice, if PSP decides not to fund
an operator. Then the District will feel pressured not to fund poor operators.”

 PSP provides a grant to a partnership of two schools along with Drexel and the Franklin Institute, to
fund development of a proposal to create a new middle school, something that the SRC had not
planned or yet voted to support. Sept. 2012 – http://thenotebook.org/blog/125165/psp‐gives‐grant‐
expansion‐powel‐school

 PSP gives grants to two charter school operators contingent on the SRC approving their expansion
plans. For KIPP, the SRC had voted to deny their expansion request (the SRC reconsidered and
largely granted KIPP’s request after the announcement of PSP’s conditional grant). For Scholars
Academies, they had applied in a competitive process to run a District school identified for
conversion to private management, but no selection had yet been made (Scholars Academies were
selected after the announcement of PSP’s conditional grant). March 2013 –
http://thenotebook.org/blog/135754/non‐profit‐gives‐34‐million‐expand‐two‐philadelphia‐charters.
o “The Philadelphia School Partnership (PSP) announced Thursday that it will give $3.4 million
to charter school operators KIPP Philadelphia and Scholar Academies so they can expand by
a combined 1,500 students. The moves could mean as much as $10 million a year in
unplanned expenses for the struggling Philadelphia School District. The push to grow KIPP
also comes just eight months after the School Reform Commission, citing concerns about
academics and cost, mostly denied requests made by KIPP to expand its existing schools in
North and West Philadelphia.”

 PSP gives grants to District schools contingent on the SRC approving expansion plans against their
original policy decision not to approve such expansions due to the budget crisis. Testimony and
discussion at a subsequent SRC meeting suggested that there had been direct negotiations between
the District and PSP. April 2013 – http://www.newsworks.org/index.php/local/education/53964‐
three‐philly‐schools‐get‐grants‐to‐expand
o “The PSP grant for SLA is for $1.9 million over three years, with an expectation that 500 new
seats will be added. Hill‐Freedman, meanwhile, will receive $2.6 million over three years to
add 600 new students and expand to include a high school. And the Sustainability Workshop,
currently a pilot project, will expand into a full high school, to be known as the Workshop
School. An inaugural class of 60 students is expected to start at the school next fall, at a

31
Exhibit X.
9
location to be determined. The school will receive $1.5 million over three years. ….
Acceptance of the grants, and at least some of the expansion plans, is contingent on the
approval of the School Reform Commission.”
o Here you can also see that the grants implicate policy/budget decision points regarding
expansion of particular schools. April 2013 ‐ http://thenotebook.org/blog/135864/advocate‐
urges‐no‐blank‐check‐philly‐charters‐seeking‐expand

 Coverage of PSP’s $3 million grants to two district schools. The grant determines whether the
schools will undergo “turnaround” restructuring. Note reference to contacts between PSP and
District leadership. July 2013 – http://thenotebook.org/blog/136257/psp‐gives‐3‐million‐two‐
district‐receiving‐schools
o “Superintendent William Hite said in an interview that the District had ‘quite a bit of input’
into the PSP's choice of schools, although the final decision is made by the
partnership's board of directors, based on recommendations from its investment committee.
‘We talked about receiving schools and schools that have demonstrated progress over the
past several years,’ Hite said. ‘We did recommend a group of schools that met that criteria
and also other schools that were receiving schools.’”

 Coverage of PSP’s $4.7 million grants for expansion of certain school operators, including a grant for
Mastery Charter Schools related to a management contract for Pastorius Elementary that the SRC
had postponed approval of due to budget concerns, and had not approved at the time of the grant;
following the grant the SRC voted to approve Mastery’s expansion. July 2013 –
http://thenotebook.org/blog/136218/psp‐gives‐47m‐expand‐high‐performing‐charters
o This round of PSP’s grants also included funding for creation of a new high school, based on
a controversial blended learning model; the SRC had not yet voted to approve the model or
the proposed operators, though it did so following PSP’s grant –
http://articles.philly.com/2013‐07‐19/news/40659271_1_mastery‐charter‐schools‐school‐
group‐thomas‐school

 See also this article for a clear articulation of how PSP’s grants are linked to – and contingent on –
particular policy decisions they want the District to make. The SRC had hesitated to previously
approve many of these expansions and contracts in support of which PSP had issued conditional
grants, due in part to the long‐term costs they would impose on the District after the expiration of
PSP’s grants. July 2013 – http://thenotebook.org/blog/136239/src‐approves‐renaissance‐
conversions‐and‐grants‐expand‐three‐district‐schools.
o “The School Reform Commission approved the Renaissance charter agreements for three
schools on Friday, officially turning Pastorius over to Mastery Charter Schools [supported by
conditional PSP grant], Kenderton to Scholar Academies [supported by conditional PSP
grant], and Alcorn to Universal Companies. At a tense, four‐hour meeting, the SRC also
accepted $1.1 million in grant money from the Philadelphia School Partnership to expand
three high‐performing District schools: converting the experimental Sustainability Workshop
into the Workshop School; creating a second campus of Science Leadership Academy; and
expanding the middle school Hill‐Freedman to include high school grades. But it did so over
the persistent objections of Commissioner Joseph Dworetzky, who did a financial analysis
showing that the District will be absorbing considerable extra cost for these schools after this
year ‐‐ a move he called financially irresponsible given the District's shaky budget picture.”
o Additionally, according to testimony at the July 2013 SRC meeting, these grants from PSP
would require annual renewal, contingent on PSP’s satisfaction that the District was meeting
conditions attached to the grant (such as a requirement that the schools receiving funding
10
be granted independence from District mandates in several areas, including professional
development).
32


Other Advocacy by PSP

 Indirect lobbying:
33
Information from various sources suggests that PSP has been engaged in
encouraging and directing others to support particular policy actions by the District, including the
controversial Boston Consulting Group‐drafted “Blueprint for Transformation” of the District. It is
believed that PSP has provided ghostwritten press materials and/or talking points to respected
nonprofit organizations in order to put a more neutral face on proposals supported by PSP. It is
further believed that PSP has expended resources to create a network of parents to lobby on behalf
of PSP’s interests.

 State‐level lobbying: PSP has acknowledged lobbying related to state education funding. Although
the direct and indirect lobbying referenced was targeted to the state level, given the involvement of
the mayor, District, and some local politicians in these negotiations it raises questions of whether
any of the lobbying might fall within Ethics Board jurisdiction. July 2013 –
http://thenotebook.org/blog/136177/psps‐gleason‐funding‐deal‐not‐perfect‐package
o “The Philadelphia School Partnership, an emerging major player in the local education
landscape and frequently a lightning rod for controversy, played a significant role in
Harrisburg in the frenzy to find a funding solution for the School District. It hired a politically
connected lobbyist and pushed hard for strings to be attached to any additional revenue.”

 Taking over the District’s “High School Expo”: PSP may have negotiated with the School District
regarding replacing the annual High School Expo, an annual event to provide families information
about their school enrollment options that has traditionally been run by the School District, with a
privately‐run event managed by PSP and Drexel University. The District announced in the late
summer of 2013 that it would be cancelling the Expo due to budget constraints, despite the
relatively low cost of the event ($137,000 in 2012) and its importance to families who may lack
access to Internet or transportation to help them visit schools and learn about school options. Soon
after, it was announced that PSP would be managing a replacement event on November 16th. It is
not clear whether the privately‐run event will have balanced representation among District, charter,
and private schools. September 2013 – http://thenotebook.org/blog/136486/choosing‐high‐school‐
new‐twists‐in‐process.

 School building sales: PSP appears to be in communication with the District and possibly
Councilwoman Blackwell regarding advocating for sale of a school building to Drexel (the President
of Drexel is a member of PSP’s board) and decisions regarding the expansion of a particular District
school. September 2013 – http://thenotebook.org/blog/136473/drexel‐others‐anxious‐university‐
city‐high‐be‐made‐available

Conclusion

The above activities raise significant concerns that PSP has been engaged in undisclosed and unregulated
lobbying, in violation of Philadelphia’s lobbying ordinance and regulations. The structure of the Great
Schools Compact can not qualify for the ‘task force’ exemption from lobbying registration and reporting, as
the Compact’s membership was not selected and its actions are not controlled by the City/District.
Additionally, PSP’s model of conditional grantmaking necessarily involves communication with the District


32
See video available at http://webgui.phila.k12.pa.us/offices/c/communications2/broadcast‐operations/src‐meetings.
33
Supplemental evidence is expected to be available regarding apparent undisclosed indirect lobbying by PSP, and will be submitted separately.
11
that amounts to lobbying. Were PSP merely creating opportunities for the District to apply for grant funds,
lobbying regulation would not be implicated; likewise, the granting of funds is not itself lobbying. However, in
offering funds only if the District agrees to adopt or reverse a particular policy action, PSP has departed from
traditional models of grantmaking and is also engaged in lobbying.

We respectfully request investigation and enforcement action by the Board of Ethics.


Helen Gym

November 12
th
, 2013