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Huge scholarship fund set up for private schools

Children
Children present a card thanking Forstmann and Walton (back row)   

Controversial plan attacked by some educators

June 9, 1998
Web posted at: 9:37 a.m. EDT (1337 GMT)

In this story:

NEW YORK (CNN) -- Private investors announced Tuesday that they will contribute at least $200 million in partial scholarships to help more than 50,000 public school children in selected cities attend private schools.

CNN's Jonathan Karl profiles a student who is on a scholarship
icon VXtreme streaming video (1:40)
A L S O :

A public school like few others

Investment banker Ted Forstmann and Wal-Mart discount store heir John Walton will contribute a total of $100 million, to be matched by another $100 million from other sources, including at least $8 million from Hollywood powerbroker Michael Ovitz.

"We're giving poor parents the same opportunity that people with money have," Forstmann said during a news conference at the New York Public Library.

The Children's Scholarship Fund will start in five cities: New York, Washington, Los Angeles, Chicago, and Jersey City, New Jersey. It aims to extend to another "30 or 40 cities," Forstmann said.

Jersey City Mayor Bret Schundler said he would donate $25,000 of his own money to help launch the effort in his city.

The fund will build upon pilot programs launched in Washington and New York.

In praising the fund, New York City Mayor Rudolph Giuliani said competition between public and private schools "is a good thing." He told Forstmann, Walton and Ovitz they had "created a revolution in education."

Several mothers of students in the Washington program also spoke at the news conference, saying the scholarships had changed their children's lives.

Helping some, abandoning others?

The effort is a boost to supporters of school "choice" in the politically charged debate over whether public school students should be able to receive financial help if they choose private schools.

Forstmann
Forstmann believes the program will help improve public education (icon 175K/17 sec. AIFF or WAV sound)   

Critics, including some public school administrators and teachers, have called the private school scholarship program a "lifeboat" strategy to save a few students and abandon the rest.

American Federation of Teachers President Sandra Feldman does not oppose the plan but says she doesn't believe it will help solve the problems of the public schools.

"I have no problem with people giving their own money," said Feldman, "unless they pose it as a solution to the problems of public schools in America."

Feldman said that public schools know what needs to be done to improve learning, they just have to find the money to put those ideas -- such as reducing class size -- in place. She said that currently is happening in a number of urban school systems.

Forstmann says his program ultimately will improve public education because it will make public school educators realize they have to change, and make parents aware that they don't have to accept schools as they are.

New York Mayor Rudolph Giuliani supports the fund
icon 152K/15 sec. AIFF or WAV sound

New York resident Barbara Davis is grateful for the scholarship won by her first-grade daughter
icon 280K/26 sec. AIFF or WAV sound

"You've got to kind of show the big, huge, moral middle of this country that, the problem exists and that something can absolutely be done about it," Forstmann told CNN prior to Tuesday's announcement.

"Just imagine how much better our economy would be if all these poor kids got educated, did not become a burden on society and were actually productively involved in the American economy," Forstmann said.

How it works

Forstmann said President Clinton, House Speaker Newt Gingrich and Senate Majority Leader Trent Lott all sent him letters of support.

He sees that as a sign his program can win support across the political spectrum, not just from the political conservatives who have called for school choice and vouchers for private schools.

Forstmann said pilot programs testing similar scholarships in Washington and New York have been successful. In Washington, more than 7,000 students applied for 1,000 positions, he said.

The New York-based non-profit Children's Scholarship Fund, will offer students roughly $2,000 to $3,000 per school year, or about 60 percent to 70 percent of tuition at urban parochial schools -- that is, schools run by a church.

The program would require a student's family to pay the rest of the tuition so that both parents and children have a stake in the student's education.

Scholarship recipients will be chosen by lottery, but they must gain private school admission to be eligible. The program will award scholarships to students from kindergarten to eighth grade. But once they win the lottery, they can get scholarship aid throughout high school.

Forstmann said his plan doesn't give preference to parochial schools, but he noted that such schools already have the ability to provide inexpensive yet high quality education in urban settings.

He predicted other private schools would start if his project gains momentum.

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