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New foundation sets $10 million grants goal

While the Chicago Public Education Fund grew out of the Annenberg Challenge, the two philanthropic efforts differ in two significant ways. First, Annenberg drew its money from one source; the Public Education Fund expects to have a broad base of contributors. Second, Annenberg had a grass-roots funding mission that focused on small groups of schools; the Public Education Fund will make fewer, larger grants in the hope of impacting the school system as a whole.
From the March, 2000 issue of Catalyst-Chicago Annenberg Challenge

The Chicago Annenberg Challenge will close up shop in June 2001, but its efforts to improve public education will live on through a new community foundation, which will be formally introduced to the city this month. In development for 18 months, the Chicago Public Education Fund is scheduled to announce its first round of grants March 28.

The Chicago Annenberg Challenge spawned the fund and became its first donor in June 1998 when it committed to donate $2 million in seed money. Chicago Tribune Charities became the second lead donor when it added another $500,000 to the pot. Substantial gifts from the Pritzker Foundation and the Polk Bros. Foundation and a number of smaller donations have boosted the fund's total to nearly $4 million. Its fund-raising target this year is $10 million.

The new fund will raise money annually, with virtually all of the money slated to be given away in grants.

Fewer, larger grants

While the Chicago Public Education Fund grew out of the Annenberg Challenge, the two philanthropic efforts differ in two significant ways. First, Annenberg drew its money from one source; the Public Education Fund expects to have a broad base of contributors. Second, Annenberg had a grass-roots funding mission that focused on small groups of schools; the Public Education Fund will make fewer, larger grants in the hope of impacting the school system as a whole.

Initially, the Chicago Public Education Fund will have a single grant-making focus: programs aimed at improving the recruitment, retention and effectiveness of teachers and principals.

The Annenberg Challenge identified those needs as key to school improvement, and they are ones that potential corporate donors can understand, notes Marianne Philbin, former head of the Chicago Foundation for Women and the consultant hired by Annenberg to set up the fund.

"If you're running a business in which 30 percent of the employees leave each year—and 30 percent of new teachers leave within five years—you understand that is a key place to put money to leverage change," she explains.

Indeed, the fund is speaking the language of business. A draft of its brochure quotes Mayor Daley describing the fund as an "investment opportunity that promises great returns for our children, our schools and our city.''

Janet Knupp, former executive director of Chicago Communities in the Schools, became the fund's first president last September. She says the fund plans to make grants to a limited number of organizations and work closely with those groups. She envisions the fund acting much like a a venture capitalist.

"We believe that if we invest significant dollars and form an active partnership, we will get great results," says Knupp.

The fund, which was incorporated in January 1999, issued its first request for proposals in the fall. It identified about a dozen school reform organizations working on issues related to the professional development of teachers and principals and invited those groups to apply.

The fund will be overseen by a working board chaired by Scott Smith, president and publisher of the Chicago Tribune, who also is a member of the board of the Chicago Annenberg Challenge.

He is joined on the fund's board by a who's who of Chicago's elite. Among them are Penny Pritzker, president of Pritzker Realty Group; venture capitalist Martin "Mike" Koldyke, founder of the Golden Apple Foundation and former head of the Chicago School Finance Authority; and Adele Simmons, former head of the John D. and Catherine T. MacArthur Foundation and now vice president of Chicago Metropolis 2020.

A supplemental advisory "Leadership Council" is equally impressive: John Rogers, president of Ariel Capital Management; sports magnate Jerry Reinsdorf; and lawyer Newton R. Minow.

To assure that the fund works in consort with central administration goals, Clare M. Muñana, a member of the Chicago School Reform Board of Trustees, also is on the fund's board. To assure the fund doesn't get too cozy with the central administration, she serves as an ex-officio, non-voting member.

Community education funds across the country strive for a balance between collaboration with school officials and independence from them; they need the former to be effective and the latter to ensure community input.

Smith says one of the fund's goals is to seek donations from "people who are already engaged" in the public schools. "We see [support] coming from an array of companies, individuals, families and foundations, many of whom already are providing support in meaningful ways."

For example, a company that already has a relationship with an individual school might also contribute to the public education fund because the fund can leverage that contribution to have an impact on the whole system, Smith explains. "We see that as complementary to programs that focus on one or several schools," he says.

The Chicago Public Education Fund also is seeking to attract donors who haven't previously given to school reform efforts. Fundraisers will target people who want to help improve public education but don't have the time or resources to sift through the programs and problems to determine where their money will do the most good, says Knupp.

"I think that with 591 schools, unless you are engaged on a daily basis with the needs of the system, it's very hard to identify how to make your investment have the best yield," she says. "If we're doing our job right, they will see their donation being leveraged into a much more meaningful investment."

Schools Chief Executive Officer Paul Vallas hopes to see the funding priorities of the Public Education Fund expanded. In particular, he would like to see an internal CPS foundation, the Children First Fund, merged into the larger community foundation.

Children First, which has about $500,000, pays primarily for after-school programs but also offers emergency assistance to the families of students and staff who have been victimized by violence, fire or other personal tragedies. Its board consists of Vallas, Koldyke and School Board President Gery Chico. Vallas says the crisis fund would continue to be operated by CPS.

The proposed merger between Children First and the Chicago Public Education Fund has been tabled while the new community foundation focuses on its initial school leadership efforts, Smith reports.

Supporters of the new fund and executives of Chicago's well-established philanthropic community agree that the Chicago Public Education Fund will add dollars to an already large pot of school reform money in Chicago. They believe that the fund's powerhouse board—many of whom already give generously to school reform causes—will attract substantial donations from other individuals and from corporate foundations. And, they say, the fund will complement, rather than replace, existing philanthropic efforts.

"We will wind up partnering with them on a number of grants," says Peter Martinez, senior program officer at MacArthur, which also sees teacher and principal development as a key to systemwide improvement.

It has worked that way in most other cities where a community fund has been established solely for public education, says Howie Schaffer, spokesperson for Public Education Network (PEN), a coalition of 48 local education funds in 26 states and the District of Columbia. PEN is working with the national Annenberg Challenge to ensure that all of the challenge sites have a local education fund when the Annenberg operations cease.

Most large urban areas already have community education foundations. However, Schaffer says that for Chicago, its late arrival isn't all bad.

Having sprung from the Annenberg Challenge, the Chicago Public Education Fund already has seen how a single entity can bring together a wide variety of constituencies to focus on a common vision, he explains. The fund, he predicts, "will evolve into a leadership role more readily than if it had grown up on its own."

"People around Chicago are universally supportive of this,'' Knupp says. "Everybody agrees that the fund can make a difference, that leadership is a priority for our public schools.''

That wasn't always the case. Two previous attempts to form a community foundation for public education in Chicago failed. The first attempt was made during Ruth Love's troubled tenure as superintendent; it was tied too closely to Love and folded when she left town. The second attempt, spearheaded by the Donors Forum, came soon after passage of the 1988 Chicago School Reform Act; it never got past a feasibility study.

Iris Krieg, author of that study, recommended that the city form a public education fund, but the effort fizzled when a number of key supporters, most of them program officers at other Chicago foundations, left those jobs and moved on.

At the time, the Chicago Public Schools was still viewed as a black hole that swallowed up money and produced few results. It was hardly an environment that would draw contributions from wealthy individuals or corporate funders. Today, however, the Chicago Public Schools is seen by influential civic leaders as a worthwhile investment.

"I think there is a far clearer commitment to the priority of improving our public schools today than in years past," Smith says. "If you ask Chicagoans what's the most important priority in the city today, the leading answer would be improving our public schools and student achievement."

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