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What Happened To The $100 Million Mark Zuckerberg Gave To Newark Schools?

BuzzFeed News spoke with journalist Dale Russakoff, whose book The Prize tracks Zuckerberg's massive gift to Newark schools and the unravelling of school reform efforts there.

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Mark Zuckerberg made a huge splash in 2010 when he announced on the Oprah Winfrey Show that he was giving $100 million to "fix" the public school system in the blighted, violent city of Newark, New Jersey.

Newark mayor Cory Booker, New Jersey Governor Chris Christie, and Zuckerberg said they would use the money to transform a failing school system from the top down. By opening charter schools, bringing in high-performing young teachers, and getting rid of teacher tenure, the three men said they hoped, in the space of five years, to create a model for education reform that would spread across the country.

Five years later, that plan is in tatters. Newark schools are still struggling, teachers still have tenure, and the education reform movement no longer sees Newark as a model worth emulating.

In her new book The Prize, former Washington Post journalist Dale Russakoff tracks what happened to that $100 million. Christie and Booker, she writes, used Newark schools and the glow of Zuckerberg's donation as a political tool, then quickly moved on to bigger, better things: for Booker, a Senate seat, for Christie, a presidential campaign.

Tens of millions of dollars were spent far away from classrooms, on things like $1000-a-day consultants and $30 million in backpay for the teachers union. A gulf grew between the successful charter schools Zuckerberg opened and the district schools, which continued to struggle. While graduation rates at public schools increased, test scores never really did. And while reformers managed to change the teachers' contract to include merit pay for high-performing educators, they were unable to get rid of the use of seniority — which kept the district locked in old union-backed systems of hiring and firing teachers based on how long they had worked, not their performance.

Caught up in the midst of reform efforts headed by mostly-white politicians and their billionaire benefactor, Russakoff writes, the almost entirely poor, black community of Newark grew angry, afraid and disillusioned as their neighborhood schools closed down. Changes, dreamed up in the skyscraper offices of consultants, were imposed on them with little of their input. The white superintendent that Zuckerberg and Booker brought in to head Newark reform, Cami Anderson, was met with such hostility at community meetings that she could often barely speak over the shouts of angry parents.

BuzzFeed News spoke with Rusakoff about Zuckerberg's millions, the Newark school district's $1 billion, and the complex issues of race, money, and philanthropy in Newark schools.

You tracked where Zuckerberg's money ultimately ended up going, and found that $20 million of it was paid to outside consulting firms. That's a huge number.

It was surprising to me to see how much they were spending on consultants, but apparently, it's not unusual. A lot of Race To the Top [a federal grant program] money, and Gates Foundation and Walton Family Foundation money, that's where a lot of the consultants come from. It's a fairly small circle of people who have been everywhere in education reform, and the going rate is $1000 a day.

Some of the work the consultants did was valuable and lasting, but the problem was this assumption that there's expertise out there and we can just buy it, bring it to Newark, and fix the system. That's so out of sync with reality. The district did need changes, but that isn't all reform is. It's figuring out the day-to-day, treacherous work that has to go on in schools and classrooms.

The consulting mentality was, "Let's fix all these systems," but it wasn't really about the lives of children and teachers.

So that consultant-driven focus on fixing the top-down, systemic problems, what effect did that have on school reform efforts in Newark?

One very illustrative example is that, the very first year before the district had hired a superintendent, they had a consulting firm in that was really changing the way the district operated. [The reform plan called for] closing a number of district schools and bringing in charter schools.

There was one school that was closed, the 15th Avenue School, a really incredibly troubled school. They closed it, and there was a school just across the park, so in a plan scripted by the consultants they decided to send the kids to the next closest school. Which makes sense if you're looking at a map. But if you're living in the neighborhood, you know that that park is a haven for drug dealing and gang activity, and you don't want kids walking through that territory right away. The parents were completely terrified.

Where did race play into the problems that the politicians and consultants, who with the exception of Cory Booker, were mostly white, faced when they tried to push changes onto the overwhelmingly-black city of Newark?

[Booker, Zuckerberg, and Christie] really basically played into these already-existing issues of race in Newark. By doing this as a top-down effort that didn't really engage the teachers and parents and people in Newark, it fit with this pattern of outsiders coming in and doing things to Newark instead of with Newark, which goes all the way back to white flight and urban renewal. This fear was in the DNA of Newark; one woman said, "We drank it with our mother's milk. We expect that people with money from the outside are going to come in and make money off of us."

Was that reaction inevitable? What's the alternative when you're trying to change the system?

There are valid concerns that if you open school reform up to a democratic process, you're not going to change anything, because the money will end up back in the hands of the union and political bosses who are already in power. There was a movement in the 80s in Newark where there was a parent uprising against the school board, and they fought for the right to elect their own board members, who up until then, the mayor had appointed. There was a massive election, something like 24 different organizations ran their own slates of candidates, and the one who ultimately got control of the school board was the biggest political boss in Newark.

But I guess I just have to believe there's a third way. Right now, local control is about to be restored to the city [instead of the governor]. There are a lot of grassroots organizations that include retired teachers and principals and clergy and people who want to have a parent and resident voice. [Mayor Ras] Baraka wants control to be restored to the city within a year. I'm skeptical [that they will be better able to get the money into classrooms], but I'm hopeful.

What was your impression of the role that Zuckerberg and his wife Priscilla Chan played? This was their first big foray into philanthropy.

I think they were both completely green. Zuckerberg met Cory Booker and was wowed by him, and Sheryl Sandberg, who vetted this whole thing, had the same impression. It says a lot about his national reputation that people who were normally much more circumspect thought he could do these almost miraculous things. There was a readiness to believe he was superman.

There are a lot of indications that Zuckerberg didn't really do his due diligence, that this was, as somebody present at the early stages put it to me, "an impulse buy." Booker had said, "I've got this, you give me your money, we'll make this happen, no problem." But [Zuckerberg] was totally ignorant of the realities of Newark.

A big part of Zuckerberg's plan was changing the teacher contract to get get rid of seniority. That was something that was really important to him. But he apparently didn't know that seniority wasn't even part of the contract, that that was set in state law, and he would have had to go through the legislature to change it. And almost anybody could have told you that the New Jersey legislature wasn't going to touch seniority.

So what has changed for Zuckerberg and Chan now, in terms of how they operate as education philanthropists?

I think he's going to do a lot more research from now on. I think that his idea was, that this was going to be a national model that could be taken from city to city. And I don't think he sees education that way any more. I think he sees education as something that is very specific to each community. And I also think he was really, really unhappy and surprised by the pushback — he hadn't expected to do something so unpopular, and so resented by the community. He believed that Cory Booker had the community behind him and what they were doing is what Newark wanted.

I think he's now trying to calibrate what he does next based on what communities want for themselves.

There was a lot more money being put into Newark besides just Zuckerberg's: there was also a huge interest and big donations from hedge funds and private equity. How did those people influence what went on in Newark?

The guys from the hedge funds, they do a lot to support education reform, and they really believe in merit pay [paying teachers based on their students' test scores] — even though the research shows that merit pay doesn't really have a big connection to student achievement. But they believe in it because their world works that way, that's how they get good people. They motivate people with money, and so why wouldn't that work?

Zuckerberg wasn't thinking so much, "We'll have a correlation with student achievement right away," but he thought he'd attract a different cadre of people into teaching in Newark. The Yale grads who normally flock into finance. He thought merit pay would be an incentive for people to go into teaching, and that it would send a flood of people to teach in Newark, and it didn't really work that way.

So that came, a lot, from business and hedge funds. And the big focus on system change, the idea that this could be "scaled up" nationally, that all sounds like venture capital, doesn't it?

You highlight these gaping differences between what resources were available in Newark to charter school teachers versus district teachers — things like reading intervention coaches, abundant social workers, supplies. What was a the root of that difference?

Well, it's funny, because the charters actually get less money per pupil, and you would think that in the district schools, there should be some economy of scale. But it seemed like beginning with less, the charters actually ultimately got more money into the classroom. And my question was, what is happening in the central office of these schools, that the money doesn't make it to the students? And I have to say, I failed at figuring that out, to figure out where exactly the money's going. That would be part two of the book, if there was one.

But the basic idea is that somehow, the money all got caught up at the school district level, in the central office, and it didn't make it into classrooms, the way it did at charters?

Right. Every time there's a huge budget gap, hundreds of people are laid off at the district. But there are hundreds more who probably should be laid off. The thing that's tricky about that, though, is that Newark has such high unemployment and so few options for family-sustaining wages anywhere in the city, so if you're laying off people at the district level, you're laying off low-skilled people who don't have a lot of options. These are people who have children in the district schools. So it's this awful tipping point. Cami Anderson [the superintendent of Newark schools] at one point said, very unhappily, "We're increasing poverty in Newark in the name of school reform."

So there's clearly a problem in Newark, and in many other school districts, with how money that comes in is actually being spent.

We really need to look at school districts, and how they spend money on the central school level. It needs to be a public conversation. I was looking at Newark's contracts, and they spend $15 million a year on scaffolding for their aging buildings.

There was one school where, days before Michelle Obama came to visit, a huge chunk of the school fell off. And so I pulled the contract for the scaffolding on that building. It wasn't a competitive bid, it was just, they called three contractors on the phone, and I looked up the guy they picked, and he was the son of the biggest political boss in Union County, New Jersey. And to top it off, he himself had pled guilty to kidnapping. He'd pled guilty to a felony, and state regulations say you can't give contracts to convicted felons. And that was the first contract I pulled. It wasn't like I had to dig, it was like shooting fish in a barrel. When you add it up, you're talking about a tremendous amount of money.

The charter schools that get so many resources to the classroom, that's essential. And you need to have principals who know how to use the money strategically. I'm not so sure you need more money. I think you need to concentrate the money at the school level, at the bottom.

There's a quote from Princess Fils Aime, [a high-performing kindergarten teacher from The Prize who starts out in a Newark district school but eventually moves to a charter]. "What is it about living in this neighborhood that makes it hard for kids to learn, and what do we do to address that? How do we teach to that?"

CORRECTION

Russakoff said that the scaffolding contract went to the son of the biggest political boss in Union County, New Jersey. A previous version of this interview said that the contract went to the biggest union boss in New Jersey.

Molly Hensley-Clancy is a business reporter for BuzzFeed News and is based in New York. She covers the intersection of business and education.

Contact Molly Hensley-Clancy at molly.hensley-clancy@buzzfeed.com.

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