The following is part of a longer essay Doug Martin is currently working on considering the Mind Trust, a corporate school reform outfit in Indianapolis.
As Atlanta Progressive Review’s Matthew Cardinale recently noted, Purpose Built Communities (PBC), a neighborhood turnaround group started in 2009 by Warren Buffett, hedge fund manager Julian Robertson, and Atlanta businessman Tom Cousins, have hired former Atlanta mayor Shirley Franklin to team up with Strategic Capital Partners to gentrify and open charter schools in Indianapolis’ Avondale Meadows region and several other cities.
With offices in Chicago, Indianapolis, and New York, Strategic Capital Partners (SCP) is a relatively new player in the corporate school reform movement. A private real estate investment management firm, SCP hired Albert Gore III, former Vice President Al Gore’s son, as their Vice President of Business Development for their Urban Development Group, after he launched GOOD magazine with help from Teach for America. In 2008, SCP welcomed Bart Peterson as their Managing Director of Strategic Partners Urban Fund, after he lost re-election for Indianapolis mayor and had launched the corporate school reform outfit, the Mind Trust.
As mayor in 2006, Peterson had approved Strategic Capital Partners’ proposal to build the Challenge Foundation Academy in Indianapolis’ Avondale Meadows district. At the Indy charter, which was honored by Indiana superintendent of public instruction,Tony Bennett, in 2010, two SCP members still sit on the board of directors, Gene Zink, the leader of the Avondale Meadows gentrification project, and Charles J. Garcia, who has also directed the Central Indiana Corporate Partnership (CICP) which with Conexus Indiana offers online degree programs to “prepare Hoosiers for manufacturing and logistics careers.” Conexus Indiana is led by Indiana Educational Roundtable member and consultant to the Indiana Department of Education Carol D’Amico, a former George W. Bush-appointed National Board for Education Sciences board member. D’Amico also has sat on the board of the Indiana Public Charter School Association and the rightwing Sagamore Institute for Policy Research. CICP was also instrumental in advocating the end of social promotion in early elementary classes in Indiana, an initiative first started by Jeb Bush in Florida. Among many others, CICP’s board of directors include members from JP Morgan Chase, Sallie Mae, WellPoint, INC., Duke Energy, the Richard M. Fairbanks Foundation, and Eli Lilly (the last two being big funders of the Mind Trust).
For the Indy charter, SCP eventually appointed Charles Schlegel as their director. Schlegel is a facilitator at the Marian University Turnaround Academy, where he recently mentored past Teach for America member Lanier Echols, who appeared in Mitch Daniels’ Aiming Higher PAC’s anti-teacher seniority ads this spring. Ironically, as principal at Wayland Middle School in Massachusetts, Schlegel violated 2008 campaign laws by sending emails through his school address to parents, begging them to support a local property tax increase to help fund the schools. Now back in Indiana working with charters whose financial records and shady activities are never questioned but endorsed by government officials, Schlegel seems content, with his wife, Mindy, to be a small mover and shaker in the corporate school reform movement. Mindy is the Senior Advisor for Teacher Quality at the Indiana Department of Education. She also sits on the Board of Directors at the Indianapolis KIPP charter school, along with the Mind Trust’s Claire Fiddian-Green, a school which ran into a serious problem last year when news broke that an 11-year-old special needs student on a field trip to Boston was allegedly sexually assaulted by four males in 2007. A former Teach for America member, Mindy is also involved in the Democrats for Education Reform.
Last year, SCP and Atlanta-based Purpose Built Communities established the Strategic Community Venture Fund for their public-private partnership plan to develop “mixed income-housing” projects and charter schools in the Avondale Meadows Community. Besides SCP’s Challenge Foundation Academy, Avondale Meadows is also home to the Charles A. Tindley Accelerated School, a charter run by EdPower, the company the Indiana Department of Education has chosen to “turnaround” Indianapolis’ “failing” Arlington Community High School. Walmart, the Eli Lilly Endowment (Bart Peterson is now CEO of Eli Lilly), State Farm, PNC Bank, the Sterling Group, Citizens Energy, and WellPoint are all involved in the Avondale Meadows project. Although reports vary, it seems the first stage of the project calls for 248-units of mixed-income apartments, 200 units of multi-family apartments, 175 units of for-sale townhouses and single family homes, and no limit on charter schools.
SCP and PBC are counting on tax credits to work their magic in Indy. Last year, the Indiana Housing and Community Development Authority “approved a reservation of more than $1.9 million annually in federal low-income housing tax credits from the State’s 2010 allocation.” And in 2011, the Department of Metropolitan Development gave land and $3, 650,000 to the project. Additionally, SCP and PBC’s mission is to take advantage of the New Markets Tax Credits (NMTC). Offered from the US Department of Treasury’s Community Development Financial Institution Fund, this credit allows investors who subsidize charter schools and other projects in inner-city communities to write-off their donations, dollar-for-dollar, on their taxes. As Juan Gonzalez first noticed, by using the NMTC investors can double their money in no time. In an interview with Democracy Now’s Amy Goodman, Gonzalez nicely details how these schemes have worked in Albany, New York:
[T]he investors who put up the money to build the charter schools get to basically virtually double their money in seven years through a 39 percent tax credit from the federal government. In addition, this is a tax credit on money that they’re lending, so they’re collecting interest on the loans, as well as getting the 39 percent tax credit. They piggyback the tax credit on other kinds of federal tax credits, like historic preservation or job creation or Brownfields credits. The result is, you can put in $10 million and in seven years double your money.
And the problem is that the charter schools end up paying in rents the debt service on these loans. And so, now a lot fo the charter schools in Albany are straining paying their debt — their rent has gone up from $170,000 to $500,000 in a year, or huge increases in their rents, as they strain to pay off these loans, these construction loans. And the rents are eating up huge portions of their total cost. And, of course, the money is coming from the state.
So, one of the big issues is that so many of these charter schools are not being audited. No one knows who are the people making these huge windfall profits as the investors. And often there are interlocking relationships between the charter school boards and the nonprofit groups that organize and syndicate the loans.
This is a favorite tactic of rich hedge fund managers, and they are involved in the project in Indy.
Apart from Warren Buffett donations, Purpose Built Communities was initiated with anti-public school hedge fund money from Julian Robertson, who has been donating to corporate school reformers for years. Case in point is the Cory Booker founded New Jersey front group, Excellent Education for Everyone (E3), headed by Black Alliance for Educational Options’ Darrell Bradford. To support himself and E3, Bradford has depended on funding from Julian Robertson’s Robertson Foundation, which, according to researcher Ken Libby, handed the outfit $100,000 in the December 1, 2007 to November 30, 2008 financial cycle. During this period, the Robertson Foundation also funded the Newark Charter School Fund ($650,000), the Democrats for Education Reform’s Education Reform Now ($250,000), Alliance for School Choice ($250,000), Teach for America ($7,120,000), the New Teacher Project ($200,000), the NewSchools Venture Fund ($3,000,000), and a slew of others. The Tiger Foundation, another non-profit headed by Julian Robertson, has also donated millions to the corporate school reform movement.
As New York Times’ Nancy Hass mentioned, the Tiger Foundation helped finance “several dozen charters”in New York City, many of which, she fails to note, have courted trouble. However, Leonie Haimson, founder of Parents Across America and Class Size Matters, does the real reporting on the Robertson family. Detailing a controversy where then-CEO of the NYC Schools, Joel Klein, allowed the Girls Prep charter to violate state law and expand inside Public School 94 as the charter was pushing out programs for autistic students, Haimson writes:
Sarah Robertson is also on the Public Prep board and remains head of the Girls Prep board. Sarah is the wife of Spencer Robertson [Julian’s son], the founder of PAVE charter school, installed by Klein in PS 15 in Red Hook, Brooklyn. PAVE is the subject of another complaint to the Commissioner, charging that its expansion will have damaging effects on the students with disabilities at PS 15, impacts which were omitted from the DOE’s Educational Impact Statement. Unfortunately, in that case, the Commissioner did not see these effects as important enough to require them to be mentioned in the EIS.
Julian Robertson is in the news recently, not about his efforts on behalf of NYC charters, but because he took the Gates/Buffett billionaire’s pledge to give away most of his money to charity. Why that couldn’t include finding space for the charter schools run by his son and daughter-in-law, so that they wouldn’t have to push out autistic and other high-needs kids from critical space in their public schools is hard to figure out.
Why did Girls Prep want to expand in the first place? See the SUNY charter center fiscal dashboard, which shows that this school had recently moved into dangerous territory fiscally speaking, and most likely wanted an infusion of taxpayer funds generated by higher enrollment, without having to dip into the hefty pockets of their board members or Spencer’s generous father.
With several new anti-public schools bills recently passed in Indiana, there is ample taxpayer money to spread around among the corporate school reformers. Little wonder than that the Robertson family wants involved in the corporate school reform movement here. In fact, they have had their eyes set on Indiana since 2004, when Phoebe Boyer, once executive director of the Tiger Foundation, held a panel with Black Alliance for Educational Options’ Howard Fuller and then-Indy Mayor Peterson at the NewSchools Summit to beef up attacks on the public education system.
For a glimpse into the corporatocracy’s plans, witness that from September 27-29, 2011, Strategic Capital Partners and Purpose Built Communities will host the Second Annual Network Member Conference at the Conrad Hotel in Indianapolis. The conference will include the Mind Trust’s David Harris, Geoffrey Canada of the Harlem Children’s Zone and hero of the movie Waiting for Superman, Richard Barth of the KIPP Foundation, and Cynthia Kuhlman of Charles R. Drew Charter School, located in the East Lake Meadows district of gentrified Atlanta. Other neocons and neoliberals out to cash in finanacially on the project will talk, too, including Indy Mayor Greg Ballard, who will be followed by Tom Cousins discussing how the East Lake “miracle” sparked the PBC. SCP’s Gene Zink will join Shirley Franklin onstage with Warren Buffett on the significance of “holistic revitalization.” Other presenters include Andre Carson, the black U.S. Congressman from Indiana’s 7th District, Madelyn Adams, Executive Director of the East Lake Foundation, and Larkin Tackett, Director of Place-Based Initiatives in the US Department of Education’s Office of Innovation and Improvement, whose office gives out grants to start-up charter schools. Two members from Indiana University Health (which recently was awarded Walton Family money to explore opening a charter school) will also give their take on setting up health care in the Avondale Meadows area.
The SCP/PBC type of public-private investment in “mixed income housing” and charter schools hardly ever turns out well for anyone but the investors, as professor Kenneth Saltman has outlined in Capitalizing on Disaster: Taking and Breaking Public Schools. In illustrating how the Commercial Club of Chicago wrote the Renaissance 2010 blueprint for mayor Daley, Saltman details how in the guise of urban renewal to help the poor, the city and big business blended “real estate profiteering and land grabs at the expense of the most vulnerable,” (137) then called for ungodly guidelines which made it impossible for the city’s poorest to reenter the new mixed housing developments, “sometimes even restricting anyone with an extended family member with a [criminal] record” (136). This exemplifies gentrification nationwide. After decades of neglecting public housing and school decay, big city mayors and privatizers move in with state grants, U.S. Department of Housing and Urban Development money, and other funds, and build expensive housing projects to drive minorities into the suburbs or homeless shelters, while wealthier white residents move in. Pauline Lipman, an outspoken critic of Renaissance 2010 and the gentrification/charter school schemes in general, adds that this real estate development breeds financial speculation, which, “in turn, causes increases in property values and rising property taxes, driving out low-income and working-class renters and home owners” (p.7). As Saltman notes, after Republicans took over the House of Representatives in 1995, they ended the requirement that for each demolished public housing project a new public project be created (135). At this point, the public schools are shut down and charter schools start cropping up to take taxpayer money for the poor students who have been lucky enough to get new public housing with their families.
We don’t have to look beyond the Shirley Franklin-Tom Cousins-led “holistic revitalization” housing project in Atlanta to see where this is heading. By 2006, in the city where Martin Luther King, Jr., was born, gentrification had forced many blacks out of the city altogether. For instance, in one former steel mill area in Atlanta, a new project called Atlantic Station developed 2,000 housing units, with each loft starting at $160,000, despite a Gentrification Task Force having been established to monitor how lower income residents were treated. Even a glance at the event held in March 2007 to kick off the East Lake Meadows project, highlighted on the Woodrow Wilson International Center for Scholars’ website, is chillingly a prophecy for Indianapolis. Philippa Strum, the Director of the Division of U.S. Studies, writes:
Former Mayor William Hudnut of Indianapolis, Indiana and Chevy Chase, Maryland spoke about the need for mixed-income housing as a major element in urban renewal, emphasizing that it can be both profitable for investors and the creator of enormous social capital. Fifty percent of East Lake’s housing is market rate. Apartments are organized, Cousins said, so that the few families on welfare live in-between two working families and are literally surrounded by examples of what they can accomplish. That, along with job training and education, helps move additional members of the community into the paid workforce.
But when rich white people move into these areas and new businesses open, blacks and other minorities find it hard landing jobs. Cousins’ statement about being “surrounded by examples of what they can accomplish” is typical of conservative propaganda which blames the victim. Since Franklin is an African-American, this is another disturbing example of what black leadership in this country deems appropriate. As Glen Ford has pointed out, black mayors like Franklin and Washington D.C.’s Anthony Williams have handed over the capital of their cities to the white power structure, dislocating their own kin in the process, because these leaders only “are loyal to their own tiny but crafty class of Black hustlers, for whom the masses of African Americans are simply pawns, marks and suckers, eminently unworthy of self-determination or even simple protection.”
After the 2008 Wall Street meltdown, Shirley Franklin’s “real-life Cinderella story” turned much worse. As Naomi Spencer notes in an October 23, 2009, article entitled “Atlanta homeless shelters strain under economic crisis,” 143,000 jobs were lost in the metro Atlanta region in 2009, along with 97,000 homes. Homeless shelters were overflowing with working people and people with Ph.D.s, and even the Salvation Army had run out of funds to build a new shelter. Spencer elaborates on the horrifying instances which led to this situation:
The first city to open public housing units to the poor in the 1930s, Atlanta now bears the distinction of being the first city to have all of them closed down. In the past 15 years, the city has torn down some 15,000 units in 32 housing projects. According to a 2007 study by the Georgia Institute of Technology, as the number of units was halved and replaced by mixed-income communities, only one third of displaced residents were able to resettle.
As part of the same broad strategy of gentrification, beginning in 2003 Atlanta Mayor Shirley Franklin issued a series of orders banning such acts as donating food to the homeless on downtown streets, soliciting donations and sleeping in public areas. Atlanta police, posing as tourists, have staged a series of undercover street sweeps, arresting dozens of homeless people for asking for
You wouldn’t know any of this by reading Education Week’s Alexandra Rice‘s new blaringly distorted article on Franklin and Purpose Build Communities, though. Rice says the East Lake crime-rate is down and “mixed-income housing is woven between shops, local eateries, schools, a family center, a YMCA, and two golf courses,” where students who all dress the same way learn to play golf. But tee tricks and test scores measure nothing but superficiality, and the lowering crime-rate in East Lake has just been moved to a different location. Drew Charter School is not meaning to train future CEOs and Tiger Woods. They are bent on producing cheap labor for the corporate machine. And Purpose Built Communities and Strategic Capital Partners do not plan to stop with kids and families in Atlanta and Indianapolis. They are also at work in Birmingham, New Orleans, Jackson, Charlotte, Clarkston, and Rome, Georgia, for a total of 25 possible projects in the next five years, destroying low-income housing and public schools. This is the pledge Warren Buffett, Bill Gates, and Julian Robertson have given to our “ownership” world.