🔒Whose Partnership Is It, Anyway? A $300 million public-private initiative to help at-risk youth courts controversy

By many measures (per-capita assets, number of millionaires in primary residence) Connecticut is the richest state in the union. It is also home to some of the poorest cities in the United States. Fairfield County personifies that contradiction, with one of the richest towns (Greenwich) and poorest cities (Bridgeport) within hailing distance.

The flashpoint for the state’s wealth gap is public education. Since the founding of the Republic, public schools have been a creature of their local communities, governed by parents of children attending those schools.

In Connecticut there are 169 municipalities, each with its own schools paid for (mainly) with local tax dollars. The quality of those, then, naturally reflects the wealth gap of those communities. High-performing schools in rich towns send kids to Princeton; non-performing schools in poor cities often send kids to prison.

Now a billionaire from the richest town, Greenwich, wants to do something about public education in the poorest city, Bridgeport, and other distressed cities throughout the state. The billionaire — hedge-fund whiz Ray Dalio — has pledged big bucks — $100 million — to help. That’s a lot of money, but only a drop in the bucket compared to a statewide $8 billion education budget. So the billionaire and his wife made their gift conditional on state government ponying up another $100 million — and then (somehow) raising a third $100 million from private sources including foundations and rich people. That’s $300 million, and to borrow from late U.S. Sen. Everett Dirksen, pretty soon you’re talking about real money.

The entity charged with overseeing this effort is called the Partnership for Connecticut. Its mission is to connect “disengaged and disconnected” young people (aged 14 to 24) to educational and career opportunities. “Disengaged” refers to students who may be struggling academically and in danger of quitting school. “Disconnected” means just that — no school, no skills, no job. The Partnership estimates that 39,000 public high-school students fall into one of those groups.

To address the issue, the partnership aims to fund programs for at-risk students in low-performing school districts to improve graduation rates and help new graduates access job training leading to rewarding career paths.

The Partnership is governed by a 13-member board of directors including leaders from the public sector (including the governor), top lawmakers, the head of the state teachers union and executives from the Dalio Foundation, including the billionaire’s wife.

The Partnership is a private, nonprofit entity, but because it has been granted a significant stake of taxpayer dollars, many observers believe the organization ought to do its business in the bright light of day for all to see. But that’s not guaranteed to happen: When the General Assembly approved the unusual public-private arrangement last year, it exempted the partnership from open meeting and Freedom of Information laws.

As a result, during its inaugural meeting October 18, most of the Partnership’s business was conducted behind closed doors, in executive session.

This was a problem, one that has generated significant criticism and pushback. Now an initiative born of bright hopes and best intentions has become mired in controversy, a product in part of a determination not to allow public transparency and accountability to gum up its functioning.

The board is chaired by Erik Clemons, CEO of the Connecticut Center for Arts & Technology (ConnCAT) in New Haven. Its day-to-day operations are handled (for now) by Andrew Ferguson, senior staffer with Dalio Philanthropies.

There are five elected officials on the Partnership’s board of directors — Gov. Ned Lamont and the top two lawmakers from each political party in each chamber of the legislature. Because the legislators are subject to disclosure requirements of state ethics law, they are not members of the executive committee.

The board’s first biggest challenge is hiring a chief executive, and the Partnership has retained a search firm, LPA Search Partners, to interview and shortlist candidates. LPA is being paid $69,300, according to the budget approved by the board. The CEO position is budgeted at a salary of $247,500.

Think of it as a real-world Golden Rule: He who has the most gold gets to make the rules.

Ray Dalio has the most gold — with a personal fortune pegged at something like $20 billion, the Greenwich hedge-fund billionaire is said to be the richest man in Connecticut. Which is saying something.

The company he founded, Bridgewater Associates in Westport, is the world’s largest hedge fund, managing some $160 billion in assets. Dalio speaks frequently about the growing wealth gap in America and the need to radically reform capitalism.

You might think Dalio is an unusual figure to be talking about “radically reforming” capitalism. But say one thing for Dalio: He put his money where his mouth is.

In addition to radical reformation of the system that yielded him vast wealth, the Greenwich billionaire is also a proponent of what he calls “radical transparency” in business. In July he told CBS’ Bill Whitacre that “Everybody at Bridgewater is monitoring everybody else almost all the time.”

Which is also kind of an irony. At its first meeting Oct. 18 in New Haven, some board members of the Partnership sought to calm concerns about transparency around the $100 million in public funds that will go into the $300 million partnership — and then spent the bulk of the three-hour session behind closed doors.

Some parents who attended the inaugural meeting asked if it was “an open secret meeting.” Another spoke of a “theft” of public money.

One of the board members, House Minority Leader Themis Klarides (R-114) was more circumspect: “I want to state on the record my concerns with operating any of this partnership not in the full public view,” she said during the public part of the meeting. “I’ve made my intentions clear to comply with the Freedom of Information Act and my reservations about transparency on this board.”

The Dalios have close links to the Ned Lamont administration — and not just the common bond of being very rich people who live in Greenwich. Lamont’s chief of staff, Ryan Drajewicz, was a senior management associate at Bridgewater.

Public education at both the municipal and state-bureaucratic levels is to a very significant extent controlled by the teacher’s union, whose Connecticut chapter president, Jan Hochadel, sits on the Partnership’s board. The state legislature is Democrat-controlled. That political backdrop is impossible to ignore — even though the lawmakers on the Partnership’s board are evenly distributed (Klarides and Senate Minority Leader Len Fasano on the GOP side; Senate President Martin Looney and House Speaker Joe Aresimowicz for the majority party).

Barbara Dalio grew up in Spain and is not herself a product of the U.S. public education system. She says she is motivated not by noblesse oblige, but out of her experience as a full-time mother raising four sons, two with learning differences. As a result, “I had to be very involved [in their education],” she explains. The experience “[made] me closer to young people who have difficult circumstances and they need more attention.” She has called public education “my passion.”

Erik Clemons is a product of Connecticut public schools — an experience that motivated him to want to be a part of the solution for a system he says is failing young people. The Partnership’s mission is personal to Clemons. Due to an unstable home life as a young person he attended four different high schools in four years. His younger brother never finished high school — he was killed before he turned 18.

Clemons believes the failures of public education in Connecticut are mired in poverty. In poor communities public schools are failing, students too often don’t finish high school, and as a result can’t find jobs. (Not coincidentally, many of these young people also end up in the criminal justice system.) The unemployment rate for 16-to-24-year-olds in Connecticut is 12.4 percent, compared to just 3.5 percent for adults 25 and older. This despite the fact that 74 percent of Connecticut employers report difficulty finding young adults to hire.

To address that disconnect, the Partnership’s desired trajectory for its young clients goes beyond the classroom and into the workplace. “The answer is to train these young people starting in high school to give them an idea of the jobs that are available,” Barbara Dalio says.

She and her husband have staked major dollars on setting solutions in motion. “With the right investments we can work with youth and young adults to create those opportunities,” she says.

The question is: Who gets to decide what the “right investments” are?

At its Dec. 16 meeting the Partnership board approved a process for soliciting requests for information (RFIs) from potential “partners” to begin to provide solutions. These include education and workforce-development program providers, potential employers, “community leaders” and others. The Partnership will accept RFI responses through January. The board also agreed to create a Program Committee to sort through the applicants and proposals.

The board also expects to be close to hiring a CEO before March 1. At the Dec. 16 meeting Willa Perlman of LPA Search Partners reported to the board that more than 225 prospective applicants from across the country had responded to the initial search, and the “vast majority” of those knew about the Partnership. “The nation is watching this initiative,” Perlman said.

Of that initial pool, LPA presented 13 CEO candidates to the board, a number that was winnowed to eight slated for personal interviews. After Clemons emphasized the importance of a “diverse candidate pool,” Perlman acknowledged that six of the eight were “white males.”

According to Clemons, the board hopes and expects to have the interviewing process completed by the end of January, finalist(s) submitted to the full board for approval some time in February, and the successful candidate hired and prepared to hit the ground running by the beginning of March.

As for the recipients of the Partnership’s considerable largess, the board will be the ultimate decision-maker — but it will be guided by the Program Committee, whose members include Clemons, Dalio, Sheena Graham, a teacher at Bridgeport’s Harding High School, and teachers union head Hochadel. The committee will make recommendations to the full board for who gets the money.

How that gang of four will decide who to green-light for funding was not discussed Dec. 16. Neither was the extent to which those deliberations will be conducted in the public.

“I’ve had an issue with this from the beginning,” says Klarides. “There’s public trust involved. There’s public money involved. So the public needs to be aware of what’s going on.”

It was Klarides who in July asked state Attorney General William Tong for an opinion regarding the apparent contradiction of public officials serving on a private board.

“I said how can we — the four elected leaders and the governor — sit on a board where we are subject to ethics laws and FOI laws — but in our capacity on this board we are not?” says Klarides.

So while legislators and Lamont last spring exempted the Partnership from Freedom of Information requirements, Tong in August ruled that the five public officials (the governor and four lawmakers) serving on the Partnership’s board were not themselves exempt.

Following the Tong ruling, the Partnership’s Dec. 16 meeting was conducted entirely in open session.

Klarides further questions the wisdom of state government — which already funds public education — pledging another $100 million in taxpayer dollars that it can scarcely afford to a public-private Partnership whose expenditures and decisions it does not control.

“The charge of this organization is great,” Klarides says. “But we [state government] are already in that [public education] business — we have billions of dollars that go to education. And that’s great. But now we’re in this side business, this side hustle, with other people.

“That’s a conflict,” adds Klarides, who represents Derby, Orange and Woodbridge in the House. “If I vote against funding [the Partnership] next year, that’s clearly against the best interests of that organization. But, If my No. 1 job is the oath I took as a legislator, then that’s definitely in the best interests of the people of Connecticut. Because we don’t have that money.”

Clemons defends both the dollars, the process — and above all the Partnership’s mission.

“I want to be clear that there is no hiding anything,” he says. “It is important that we can actually have really courageous conversations about an organization that’s going to do great work and create a huge impact. It was never about some clandestine operation that’s going to harm or experiment on black and brown kids.”