Jeremy Nowak’s Vision for a New Philadelphia

Armed with a $2 billion endowment, visionary William Penn Foundation president Jeremy Nowak wanted to bring to life a new Philadelphia. Old Philadelphia, it seems, has other ideas.

The first people he pissed off were his own: people at the foundation, men and women who’d been there for years and years. Nowak wasn’t just directing money to new places; he was changing how that money got directed in the first place. And the way he changed it placed power in new hands.

In the past, the power to make grants had always lain with program officers—people who specialized in a certain area, like education, the environment or the arts. For certain types of grants, Nowak wanted to instead move to a system of panels in which groups of people, some of them experts in their fields from outside Philadelphia, judged grant proposals using a more quantitative method, to decide who would receive money. This would make the process more competitive, pitting organizations against each other; the idea also alienated some of the most experienced staff. According to a former employee, Nowak seemed less like a philanthropist than a banker. “He was acknowledged as kind of a big thinker,” the ex-employee says. “Visionary. But the one thing he didn’t do was listen. He came in knowing what he wanted to do and how to reshape things, but there was no analysis of a problem that needed to be addressed. It was just: I don’t want to do it that way anymore. I have a better way.”

The board cleared space for Nowak to operate. At an early board meeting, someone “asked him some tough questions,” says the former employee, “and Janet [Haas] said, ‘He doesn’t need to answer those right now. He needs more time.’” In March 2012, Nowak laid off nine foundation staffers and made two hires of his own. Around this time, several organizations that had long been supported by the foundation received word they shouldn’t plan on any more of its funding: the Theatre Alliance of Greater Philadelphia, an umbrella group of theaters; a group called ArtsRising, which taught arts to children in mostly underachieving public schools; Pennsylvania Performing Arts on Tour (Pe­nnPAT), which supported touring artists; and a number of education organizations, including three that had been critical of efforts to turn more schools into charters, according to the City Paper. (The Theatre Alliance later dissolved, citing “a time when resources for the arts are constrained,” and so did PennPAT.) Meanwhile, Nowak made some splashy new bets. On July 10th, the foundation released a list: 10 grants worth $4.2 million for
watershed-protection projects; 20 grants worth more than $10.8 million to arts and cultural organizations, including the Kimmel Center ($2.5 million) and the Franklin Institute ($2 million); and a whopping $15 million to a relatively new organization called the Philadelphia School Partnership (PSP).

It was the PSP grant that caught everyone’s attention, not only because of its size but because of the structure and makeup of PSP. It’s run by an ex-journalist named Mark Gleason, and its board is packed with supporters of school privatization; one of its donors is Janine Yass, wife of hedge-fund manager and privatization advocate Jeffrey Yass, backer of the powerful Students First PAC.

But the PSP grant wasn’t the foun­dation’s only big move in the area of school reform. It had also begun working with a controversial company called the Boston Consulting Group. BCG has deep ties to privatization advocates. Many cities have hired it to lay out road maps for reforming their schools. In February, the School Reform Co­mmission—the state-controlled board that runs the Philadelphia School District, which is on the brink of bankruptcy—commissioned BCG to take a broad look at education in the city, generating ideas to patch the district’s budget holes and boost student achievement. William Penn contributed $1.5 million toward the tab and raised another $1.2 million.

The BCG report was drastic. It recommended closing up to 57 public schools and dramatically expanding charter schools, which it predicted would educate close to 40 percent of the city’s students by 2016. These recommendations formed the basis for the SRC’s “Blueprint for Transforming Philadelphia’s Public Schools,” released in April, which suggested closing around 40 schools. Public-school advocates were outraged, dismissing BCG’s work as “a boilerplate menu of silver bullet education reform ideas” that “make little to no mention of what it will actually take to educate our children,” according to the Philadelphia Federation of Teachers. At a May protest rally covered by the Philadelphia Public School Notebook, J. Whyatt Mondesire, president of the Philly chapter of the NAACP, said, “We at the NAACP despise the Boston Consulting Group,” and at a subsequent SRC meeting, Jerry Jordan, president of the PFT, said, “We want adequate, stable funding spent in schools and classrooms—not millions of dollars wasted on … pricey consultants.”

Public-education supporters weren’t surprised that an outside consultancy was trying to shove the city in one direction. They were surprised to see the foundation’s fingerprints. Until now, William Penn had never made itself a combatant in such a highly charged arena. But in a way, it fit a trend. In recent years, national philanthropies like the Bill & Melinda Gates Foundation and the Broad Foundations have taken a more activist, political role in urban education, using their money and clout to push for a certain kind of change. “The philanthropic vehicle allows some entities to bypass a public process and find a shortcut right to decision-makers at the top,” says Helen Gym, the co-founder of Parents United for Public Education, a group that argues for more investment in public schools. “There’s a view that holds that it’s just about how smart you are and how fast you can move things, and the public is a pain in the neck and they’re more hassle than it’s worth.”

Gym has known Nowak for a few years. She respects him as “a self-made man who has very keenly recognized the failures of government to provide much-needed services.” She says she’s disappointed, though, that Nowak “went with what the massive trend in reform was, backed by ideologues and deep pockets.” She adds, “He’s here to change the game. I guess the question we should be asking is, ‘Is this the game we want to play?’” (Nowak responds: “My personal view is that centralized control and command systems are breaking down because technology, civil society and private innovation are transforming them. The Ed debates should be viewed within this context.”)

On November 15th, Gym’s group delivered a letter to the foundation raising concerns about the BCG report. A few weeks later, Parents United filed a complaint with the City Ethics Board. The gist of it was that the foundation, by hiring the Boston Consulting Group, had lobbied the district without ever identifying itself as a lobbyist. Also backing the complaint was the NAACP.

I interviewed Nowak five days after Gym sent the first letter. Nowak didn’t mention it. When I asked him about these issues—about the alleged politicization of the foundation, about its ties to polarizing figures in the national charter-school movement, about BCG—he wasn’t feisty or defensive. He laid out his case in calm tones. No, he didn’t see himself as part of any movement. He didn’t care if a school was public, parochial or charter, as long as it closed the achievement gap: “We’ve taken a pretty agnostic view.” Yes, the foundation had hired BCG, but in Nowak’s eyes, BCG was just a tool to generate data for local decision-
makers. He asked if I had actually read the BCG report. I said I hadn’t. He stood up, left the room, came back, and placed a copy before me. BCG has become “a boogeyman,” he said, but the document is actually quite sensible. (While written in neutral prose, the report is sharply one-sided. Except for a few lines acknowledging that some charters are bad—“there is a range of performance levels across charters”—it treats the expansion of ch­arters as an unalloyed good, barely mentioning some well-documented problems. And according to the PFT, BCG didn’t interview a single classroom teacher.)

Nowak seemed mildly confused by all the blowback, even a little wounded. By his lights, he’d only done what he’d been doing for decades: getting data on a problem, then bringing private and public folks together to make a decision and execute. “I’m not sure what our choice is, as a nation,” he said. “The great thing about Americans is their pragmatism. And if we could get back in touch with our damn pragmatism in some ways, and solve problems?” He shrugged. “That’s how I’ve thought about it.”

Eight days after our conversation, Nowak and his board parted ways.

So, what happened?

The most obvious scenario involves school reform: The Haas family members got sick of the negative publicity, blamed Nowak, and gave him the boot. But maybe not. “I would be surprised if that was the issue it split over,” says Scott Gordon, CEO of Mastery Charter Schools. (Nowak used to chair Mastery’s board.) “My impression was that the storm had largely passed. The Boston Consulting Group stuff seemed to be settling down.” Gordon wonders if the split had to do with something else, like the arts.

This is plausible. The members of the Haas family have many connections in the city’s arts world and therefore many opportunities to pick up on any whiffs of displeasure within it. But the education folks have a stake in pointing the finger at the arts folks, so it’s hard to know.

“We’re all very nice to each other,” says GPTMC’s Meryl Levitz. “Conversations stop before we hurt anybody’s feelings. And Jeremy didn’t seem to be afraid to break a few bones here and there.” She adds, “Everybody here is so interrelated in many ways, and you don’t want to hurt other people’s feelings and you don’t want to threaten other people’s jobs. But Jeremy raised the question: What price do we pay for that?”

It’s tempting, actually, to view Nowak’s tenure at William Penn as confirmation of some of the things he’s been saying about the city’s resistance to change. After all, here is a guy who was hired by the city’s most powerful philanthropy to help it figure out how to flex its muscles in new ways, who did exactly that, and who was gone after 17 months. It’s tempting to write something like this: Even when we say we want guys like Nowak in the room in Philadelphia—guys with fresh ideas and new energy, guys who will challenge us to be better—we don’t really want guys like Nowak in the room.

Without any definitive information about why Nowak and the board diverged, it’s impossible to know for sure what happened. So this interpretation could be wrong. No one is saying he’s a martyr. He’s certainly guilty of angering longtime staffers. He’s guilty of not being more transparent about the foundation’s efforts to push school reform. He’s guilty, perhaps, of hubristic ambition—of backing one side over the other in a high-stakes battle for the soul of our education system and thinking he could survive the inevitable storm.

What’s clear is that no one forced the foundation to hire a change agent in the first place. As late as last summer, board chair Janet Haas was praising the str­ategic-planning process that Nowak directed. “The foundation’s new direction builds on the work that we’ve done for decades, but brings more focus to critical challenges and timely opportunities,” she told the Inquirer, adding that the foundation “will employ a transparent, data-driven approach that emphasizes assessing results and communicating clearly.”

William Penn went in with eyes open. Then, for some reason, it blinked.

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