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Ethics complaint accuses Boston Consulting Group, William Penn Foundation of violating lobbying code
Advocates will file an Ethics Board complaint charging Boston Consulting Group and William Penn Foundation with violating city code by lobbying to support a controversial School District plan without registering.
Ethics complaint accuses Boston Consulting Group, William Penn Foundation of violating lobbying code
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Advocacy groups will file a complaint with the Philadelphia Board of Ethics Wednesday charging the Boston Consulting Group with violating city code by failing to register as a lobbyist while proposing that the School District close down traditional public schools, possibly accelerate privatization through charter expansion and increased private management, and bust blue-collar unions. The William Penn Foundation, it charges, also violated the code by failing to register as the principal on whose behalf, along with the undisclosed anonymous donors they solicited funds from, BCG was lobbying.
"This complaint is fundamentally about the public understanding that the controversial plan by the Boston Consulting Group was funded by narrow private interests with a specific agenda," said Parents United co-founder Gerald Wright in a press release. "They have been allowed unprecedented access to information and data denied to the public, and they have had unprecedented access to lobby top decisionmakers without ever identifying as lobbyists."
BCG and William Penn denied the allegations.
"We are aware of their intent to file a complaint, and our attorneys are confident that it is without merit," said William Penn spokesperson Brent Thompson.
The complaint, filed by Parents United for Public Education, the Philadelphia Home and School Council, and the Philadelphia NAACP, alleges that the Boston Consulting Group was acting as a lobbyist when it developed a plan for the School District of Philadelphia funded through and at the direction of the William Penn Foundation, with whom they had at least two contracts. BCG would have been required to disclose their donors, many of whom remain anonymous, if they had registered as lobbyists.
Jeremy Nowak, who orchestrated the $2 billion William Penn Foundation's controversial campaign on behalf of corporate-model school reform groups (while cutting off funding to progressive schools organizations), stepped down as the foundation's president last week. City Paper published an investigation of Nowak in July.
"BCG was hired as a consultant to the school district," said BCG spokesperson Alexandra Corriveau. "We were engaged at all times to perform services for the district and for no other purpose. None of our activities on behalf of the district constituted lobbying under the law. We are confident that any potential complaint will be dismissed."
But according to the Board of Ethics, which implemented the city's new lobbying code after great delay on Jan. 1 of this year, lobbying is defined as an "effort to influence legislative action or administrative action" in city agencies including the School District.
In sum: If William Penn Foundation raised funds from unknown sources for the Boston Consulting Group and directed it to influence School District policy they, the complaint alleges, clearly violated the code by not registering as principal and lobbyist. This might be the first such complaint under the new code. Ethics Board Executive Director Shane Creamer said that confidentially rules forbade him from confirming or denying any complaints, but added, "I can say that we have not publicly announced any enforcement of the lobbying law yet."
School District spokesperson Fernando Gallard declined to comment, saying that "The District's Office of General Counsel has not received a copy of the complaint and has not had an opportunity to review the complaint."
The final BCG proposal, an early draft of which prompted widespread protest and debate when it was released in April as part of the state-controlled School Reform Commission's "Blueprint for Transformation," called for the closing of between 29 and 57 traditional public schools, the mass downsizing of the District central office and reorganization of schools into "achievement networks" potentially run by private managers, and the outsourcing of the District's blue-collar workforce.
Blue-collar unions made large concessions to avert privatization, which the District had used as leverage in its negotiations. The achievement networks, which were loudly criticized as a vehicle to privatize school management, were put on hold.
"BCG has engaged in four distinct phases of work," according to The Philadelphia Public School Notebook, "all paid for with $4.4 million in private donations, most or all of which have been coordinated by the William Penn Foundation and delivered through the United Way of Southeastern Pennsylvania."
The donations, passed through various organizations, are shrouded in secrecy. But it is known that a large sum was donated by board members of the Philadelphia School Partnership, an increasingly influential pro-charter school organization with close ties to the school voucher movement that received a $15 million grant from William Penn. Real estate developer Michael O’Neill contributed $100,000, according to The Notebook. In a July investigation, City Paper reported that an undisclosed amount was donated by Janine Yass, wife of conservative Bala Cynwyd hedge-fund manager Jeffrey Yass, among the state’s most high-profile voucher supporters.
"It is known...that some of the donors are real estate developers; whether they have any business interests in connection with the closing and re-use of schools is unknown," according to the complaint. "Other donors are organizations and individuals with strong ties to charters and non-public institutions that may or may not have a business interest in many of the recommendations; it is impossible to know without them being registered."
The possible penalties for violating the lobbying code, however, are weak: a $2,000 maximum fine and a ban on lobbying for "economic consideration" for up to five years. But the embarrassment could nonetheless prove costly.
A major communications campaign to sell the BCG Blueprint to a skeptical public, undertaken by William Penn, the School Reform Commission and Philadelphia School Partnership, highlights the heavy outside involvement in School District affairs. City Paper uncovered the campaign in a July investigation. Later that month, The Notebook reported that William Penn had paid two communications firms, Sage Communications and the Bravo Group, $160,000 to promote the Blueprint. Bravo is run by Philadelphia School Partnership board member and top Republican lobbyist Chris Bravacos. Because of the BCG contract's opaque funding structure, it is unknown whether Bravacos, who also serves as an intermediary for corporate donations to voucher-like tax credits, contributed money, or if an entity with ties to Bravacos did.
"If BCG had been registered as a lobbyist, and WPF had registered as a principal, they would have had to file Quarterly Expense Reports," according to the complaint. "These would reveal information concerning, among other things, who BCG had contacted at the District and SRC in order to advance its positions and when it had done so, what positions BCG had taken on specific issues, and information about the principal’s funding sources."
The report also stated that 40 percent of district students would be enrolled in charters within five years, which the District said was a "linear projection" rather than a recommendation. But the Philadelphia School Partnership, in a grant application to the Bill and Melinda Gates Foundation seeking funding for the Great Schools Compact obtained by City Paper, “calls for,” and not just projects, “increasing charters’ share of public-school enrollment to 40 percent by 2017.”
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