Tuesday, April 24, 2012

Bridgeport, Using the Mantra of Ed Deform to Steal Public Funds


I would’ve sworn you used the word “transparency” – The Art of Moving Public Funds “Off-Line”


Oh, remember the good ole days when politicians just directed that public contracts go to friends, donors and certain companies.

That was then and this is now…and a whole new approach is taking shape.
This week we learned that Governor Malloy and his education commissioner, Stefan Pryor hired certain consultants to help develop Malloy’s “Education Reform” bill.  Rather than go through some silly competitive bidding process, they simply got a quasi-state agency, SERC to hire the two consultants; one for $195,000 and the other for $60,000.
The State Department of Education then reimburses SERC with funds from its budget and it’s all legal (maybe, sort of).
But that is nothing compared to what is quietly taking place in Bridgeport.
Bridgeport is taking it to a whole new level – an approach that saves time and energy by creating a system in which hundreds of millions in school funding can be moved “off- line.”
When Mayor Bill Finch and Fairfield County businessmen got tired of having to deal with elected members of the Bridgeport Board of Education last year, they convinced Governor Malloy to have the state take over the Bridgeport school system.
Alas, the state moved so quickly that it broke the law and the State Supreme Court was forced to step in to stop the takeover attempt and require that a new election be held to fill the vacancies on the Bridgeport Board of Education.
Meanwhile, not to be outdone, the Mayor and business community moved forward with its overall plans.  The superintendent of schools was fired and Paul Vallas, Jr., the famous and renowned “school reformer” was brought in to completely revamp Bridgeport’s system of public education.
Since the endeavor would cost money that the city of Bridgeport didn’t have, business leaders set up the Bridgeport Education Reform Fund and quickly raised about $400,000. Vallas’ $229,000 salary is being paid out of the Fund as are the various consultants Vallas says he needs to complete his task.  To date there has been no information about just who those consultants are or how much they are being paid.
In fact, since the Fund’s activities are confidential, there is no way to actually determine how much money has been raised, who donated the money or even how it is being spent.  The Connecticut Post, the Wall Street Journal and others have written that one of the lead “investors” in the effort is the ZOOM Foundation and the Lone Pine Foundation, both of which “belong” to hedge fund billionaire Steve Mandel.
For more on this issue, see the  March 26, 2011 Wait What post for details about the role Meghan Lowney, Zoom’s Executive Director, played when it came to lobbying state officials to take over the Bridgeport schools.  Although Lowney and others failed to register, as required under state law, the Ethics Commission can neither confirm nor deny that an investigation is under way.
But we are now learning that the Bridgeport Education Reform Fund was only the stalking horse for a much bigger and more impressive effort.
As Bridgeport Superintendent of Schools Vallas rolled out his plans for a revamped Bridgeport education system, he included the creation of a “Good Schools Bridgeport Foundation” which will “support the school district by securing public and private funding that…and to use that funding to help the district expand high quality school options.”
Under Vallas’ plan (which was immediately endorsed by Bridgeport’s Mayor), the “Principal Functions and Responsibilities of the Foundation” would be:
  • To monitor academic, financial and operational performance of Bridgeport schools.
  • To identify high quality Bridgeport schools for future duplication and franchising.
  • To implement programs to improve existing schools and to expand school choice options by supporting open enrollment, accelerated and exemplary programs in qualified schools.
  • To create a system for identifying, recruiting, incubating and certifying proven high quality providers to open new schools or to assume management of failing schools.
  • To create a process by which the community can provide input into the selection of school providers to open new schools or to take over failing schools.
  • To serve as a pipeline for recruiting and training high quality administrators, principals and teachers for Bridgeport Public Schools.
And, of course, the Foundation would hold the purse strings to ensure that its vision of appropriate developments take place.
To further insulate the Foundation for meddling by elected school boards or, for that matter, democracy, his plan also provides that the Bridgeport Regional Business Council will “monitor the school district finances” and a new entity that will be called the Bridgeport Academic Accountability Council and consist of “nationally renowned researchers” will be put in place to evaluate and guide the school district’s performance and programs.
In this way, Bridgeport’s parents, teachers and taxpayers would not need to worry themselves about how school funds are being spent.
The Mayor has announced that he hopes to raise at least $50 million in private funds for the program or, in his words, “I’m going to raise millions of dollars…A lot of wealthy people in Fairfield County, they drive by Bridgeport all the time, and I know they can help, and we welcome their support.”
And Paul Timpanelli, the President of the Bridgeport Regional Business Council, the organization responsible for monitoring the Bridgeport School’s finances called the plan terrific saying “It’s comprehensive, aggressive. I’ve seen a lot of the details and I’m very pleased…I don’t know what’s not to like.”
And should anyone doubt their intentions, the Wall Street Journal wrote last week that “Mr. Vallas argues that if he can show early successes, the push for better schools from parents, the mayor and the governor will sustain the momentum no matter who is on the new school board. But he isn’t counting on that. Under his deal with the current school board, he is to help pick his successor. And, according to both Mr. Vallas and the mayor, new money for schools—not only private funds but, in a twist, also new city tax money—will be funneled through a non-profit, Good Schools Bridgeport, to try to keep the new school board from deviating from the Vallas path.”
Although it would certainly engender law suits, there is even talk of moving the money the city of Bridgeport receives from the State (i.e. the ECS Funds) into this new Foundation, thereby, bypassing the need to follow all those pesky “transparency” rules like having to use competitive bidding or limiting the use of consultants.
Of course, Wait, What? readers will recognize that Governor Malloy’s “Education Reform” plan already includes a generous program to moves money “off-line.”
Under Malloy’s proposed “Commissioner’s Network” system, the commissioner of education will take over 25 failing schools, fire the staff, ban collective bargaining, turn the schools over to a third party and that entity will then be legally exempt from the state’s laws requiring competitive bidding and the law limiting the use of outside consultants.
Taxpayer funds going to private entities to spend as the deem appropriate.
On the other hand, if they can pull off what they are attempting to do in Bridgeport, governors and others won’t have to go through that awkward process of having to order quasi-state agencies to retain certain consultants or the “lengthy process” of getting the legislature to change the laws.  Under Bridgeport’s new approach the money – public and private – would go to a private foundation.  Then, since the consultants would already have control of the funds, they could decide among themselves how they wanted to divvy up the taxpayer’s money.
Between Malloy’s “Education Reform” plan and Bridgeport’s new effort, the notion of “transparency” is on the way of becoming a word of the past.
And lest Connecticut resident’s think these efforts are confined to Bridgeport, rest assured that if Malloy, Pryor, Vallas and the Michelle Rhee’s of the world can get away with these activities in Bridgeport; New Britain, Hartford and New London, other fiscally and academically distressed school districts won’t be far behind.  There is a reason the corporate elite and outside groups are spending so much money to get Malloy’s bill passed and Bridgeport’s new Foundation set up.  When all is said and done, we aren’t talking about tens of millions of public dollars; we are literally looking at hundreds of millions of taxpayer dollars at risk.

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