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A new strategy: Creating school foundations
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An annual sale of donated Department 56 merchandise nets $100,000 for Minneapolis public schools. (MPR Photo/Tim Pugmire)
Fundraisers are more frequent than fire drills in most public schools. But traditional candy and bake sales aren't generating the kind of money needed in many cash-strapped schools. Minnesota schools are increasingly raising funds like many colleges do, creating their own non-profit foundations to bring in private money to enhance the quality of programs. The amounts raised are relatively small, but critics say such fundraising can exacerbate the economic disparities that already exist among schools.

St. Paul, Minn. — The experts keeping tabs on school district foundations estimate the number at over 4,800 nationwide. That's about one-quarter of the nation's public school districts.

David Else of the National Center for Public and Private School Foundations at the University of Northern Iowa says the number of these charitable organizations has been growing steadily since the mid 1980s. He says school foundations raise anywhere from a few thousand dollars annually to well over $100,000.

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Image David Else

"It's an excellent source of funding to help purchase supplies, equipment that they need for their schools that they could not provide for within their own budget," Else said. "School foundations were never designed to raise money to replace state or federal support for education or local property taxes."

Still, Else says interest in foundations appears greater now, at a time when state and school district budgets are tightening. He says foundations are a more effective and efficient method for fundraising. Schools typically get back less than half the proceeds when students sell frozen pizzas or wrapping paper.

Roughly 50 foundations operate in Minnesota, and more are in the works. Each has an independent board of directors that decides how money is raised and distributed. Financial reports filed with the state attorney general's office show a wide range of activity. For example, the Roseville Area School District #623 Foundation provided schools about $9,500 in 2003. The District 279 Foundation in Osseo spent nearly $98,000 on its schools.

Rep. Alice Seagren, R-Bloomington, chairwoman of the House Education Finance Committee, says it's a bad trend. She's concerned about the growth of foundations and their potential to create wider financial inequities between wealthy and poor school districts. Seagren says she doesn't want local foundations to play too large a role in funding schools. "You'll have real sophisticated school districts that might be able to put together a foundation and do very well, depending on their population of citizens," Seagren said. "And others will not have that kind of resource available to them."

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Image Maureen Bazinet

Shoppers pack International Market Square in Minneapolis each fall to load up on merchandise of a much higher quality than typical school fundraisers. Department 56, the Eden Prairie-based giftware company, donates a room full of its holiday decorations and collectables. The annual sale benefits the Minneapolis school district's Arts For Academic Achievement program. The event raises $100,000.

Maureen Bazinet has run the sale for five years. She also started the district foundation that's now called Achieve Minneapolis. Bazinet says individuals and businesses like having a way to contribute to the public schools, but that wasn't always the case.

"(It's) a little bit hard for people to get their heads around," Bazinet said. "How can you be raising private funds when the public pays for public schools out of publicly raised money, taxes? Well, I think less and less people are asking that question as they see what's happening to public schools."

Achieve Minneapolis has grown into a full-service development office, pumping nearly $4 million a year into a school district with 43,000 students and a lot of needs. The organization sponsors fundraising events, solicits corporate donations and seeks out grant money.

You'll have real sophisticated school districts that might be able to put together a foundation and do very well ... and others will not have that kind of resource available to them.
- Rep. Alice Seagren, chair of the House Education Finance Committee

Catherine Jordan, president and chief executive officer, says the local education fund helps pay for systemwide reforms the district cannot afford, such as the recent reorganization of high schools into smaller learning communities. She says it also funds educational extras that no longer fit in school budgets or parents have difficulty paying for. The list ranges from adult mentoring programs to class field trips.

"We are in no way funding the basic core educational program in the public schools," Jordan said. "That's the job of the taxpayers -- to support the buildings and the faculty. What we do is enhance the curriculum by bringing in extra dollars."

The need for enhanced learning opportunities is also the focus of the Blue Earth Area School Foundation. The organization raises about $50,000 a year for a district of 1,400 students.

Roger Grandgenett, the foundation president, says most of the money comes from an annual social event. School district employees contribute about $10,000 through payroll deductions. The foundation has paid for classroom equipment, trips and a district awards program.

It's also nearly eliminated the need for small fundraisers like candy sales. Grandgenett calls the foundation successful. But he says there are fundraising limitations in a small rural community.

"You can only ask a business or an individual so many times to give money for something like this," Grandgenett said. "And there were some very generous people in the first few years that the foundation was formed, who would donate a sizeable amount of money. And we just felt bad going back to them."

The annual Blue Earth fundraising works out to roughly $35 per student, compared to about $93 in Minneapolis. Compare that to the money raised last year in the suburban Orono school district -- nearly $158 per student.

Orono parents started a foundation four years ago because they wanted more education options for their kids than the district could afford. Philanthropist Bruce Dayton, a district resident, kicked in $100,000. Musician Lorie Line, another resident, performed a benefit concert that raised $82,000.

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Image Lorie Line

The Orono Alliance For Education raised more than $1 million in three years, and is now funding core expenses -- including teacher salaries. Executive Director Tammy Hauser is unapologetic about the foundation's success.

"Every school district can make this happen," Hauser said. "Not to this level, but they can make something happen regardless of the level of income of the residents. There's time, talent and resources that can be offered, and just creating a closer knit community between parents who want to give something back to the schools."

Hauser also runs a business assisting nonprofit organizations. She says because the fundraising highlights the support the school district enjoys from the community, it serves as an effective marketing tool. Hauser says enrollment is increasing in Orono, with many students transferring from neighboring school systems.

Sen. Steve Kelley, DFL-Hopkins, says he's not concerned by the growth of foundations. Kelley, who chairs the Senate Education Committee, says educational equity is an important value in Minnesota -- but so is educational excellence.

"If a district is using extra resources to try to reach for excellence for its students, I think that's also an important goal that Minnesota ought to support," Kelley said.

Kelley says he hasn't heard any of his Senate colleagues raising concerns about school foundations. But he says it's an issue that could likely come up in the future, as the numbers continue to grow.

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