APRIL 18, 2010 - With dreams of innovating in education and child care, John "Johnny" O'Brien triumphantly opened a new $30-million complex for incoming students in the summer of 2007, on the pastoral campus of the Milton Hershey School.

Set on a private road apart from the main buildings of the Dauphin County boarding school for disadvantaged youngsters, there were separate dorms for 40 boys and 40 girls and an eco-friendly main lodge with a bamboo floor.

Camping and hiking were part of the learning experience at Springboard Academy. Students could lounge on futons. The goal was to improve new-student academics, ease homesickness, reduce attrition, and have some fun.

"I would have liked to have had it when I was there," said Duey Craven, a student in the early 1980s who recalls regimented days at Hershey milking cows and cleaning barn stalls.

High in concept but thin on outcomes, the nation's wealthiest school for needy children now says that Springboard belly flopped and will close in June after burning through $40 million to $45 million in capital and operating costs.

It's the latest setback at the institution that seems in a constant state of construction, rebuilding, and unfulfilled potential.

The free school, with $7 billion in assets and financed with profits from Hershey Co. chocolate sales, recently announced that it won't hit a widely publicized goal of 2,000 students by 2013 because of weakening income from its endowment. The school had said it would reach that enrollment after a late 1990s public outcry that the Hershey School, located southeast of Harrisburg, was failing its charitable mission to educate impoverished children.

The school's reason for shuttering Springboard: It was costly and didn't seem to be working. But observers say parents were uncomfortable with the educational techniques, while there was concern about bullying in the dorms and unsupervised students sneaking off.

Also key: Springboard lost the support of the school's controlling board, which unanimously approved Springboard in 2005. That same board voted April 7 to close it.

"There were a lot of positives to come out of Springboard, but at the end of the day it was more costly than the core program," said school spokeswoman Connie McNamara, who added that it wasn't a waste of resources. "It was a learning experience. It was something we needed to explore."

Springboard allowed the school to experiment with a new living model for students and develop programs to reduce attrition, she said.

O'Brien, a former Milton Hershey president, contacted at his Florida home on Friday, said he was disappointed that Springboard was closing so quickly, and that it was never intended to compete, or be compared operationally, with the Hershey School's main program.

Springboard was to be the "Bell Labs" of the Hershey School, O'Brien said, and advances in Springboard, such as ways to ease homesickness or communicate more effectively with parents, would be transferred to the main program. He said he couldn't comment more because of nondisclosure agreements he signed when he departed the school.

Current enrollment at the Hershey School is about 1,875, an all-time high. The institution added hundreds of students in the last decade under O'Brien, but some say the school could enroll 3,000 and others say as many as 8,000. It was founded in 1910 as an orphan home and school by Milton and Catherine Hershey, who bequeathed it their chocolate fortune.

"We are not decreasing enrollment in any way," McNamara said of the Springboard closing. The eighth graders in Springboard will advance to ninth grade and be placed in group homes, and no new students will be enrolled in the academy, she said.

The rumor mill had been grinding away for months as a task force appointed by school president Anthony J. Colistra studied Springboard's options.

Colistra, a '59 graduate, had been chairman of the controlling board when it voted in 2005 to move forward with the project.

"After carefully considering scenarios which ranged from continuing the program as it is currently, changing it, or closing it entirely, we have determined that the Springboard program will end this year," Colistra said in an April 8 memo to 1,200 teachers and staff.

"We are making this decision," he wrote, "because while many positives were achieved at Springboard, student results were not dramatically different than those in our core program and thus do not justify the nearly $3 million annual cost to run the program."

Springboard cost $9,300 more per student than the core program, McNamara said, and employs 30.

Craven, an official with the school's alumni association, thought Springboard was a good idea when it was proposed. Most children at the Hershey School come from single-parent households or troubled families. Arriving at the Hershey School with its "lights-on" in the morning and "lights-off" at night tempo can be a hard transition, he said.

The academy would be a place to ease that transition for students of various grades, Craven hoped. Instead, it evolved into a sort of alternative school for eighth graders.

A vexing issue for the Hershey School - which spends more than $100,000 a year on each student for program services and management overhead, according to IRS tax filings - has been student turnover. Students leave because they are homesick, not prepared academically, or expelled. There are 311 students from the Philadelphia area there.

A Hershey School task force researched, visited, or consulted with about 20 other schools that had elements of programs that it wanted to explore with Springboard, McNamara said. Among the schools were Hyde School in Bath, Maine; Boys Town near Omaha, Neb.; Putney School in Putney, Vt.; and Pressley Ridge in Pittsburgh, she said.

Springboard slightly improved student attrition but not dramatically, she said.

F. Frederic Fouad, an '80 Hershey graduate and a 2009-10 visiting scholar at Harvard Law School who focuses on child-care issues, said Springboard shouldn't have been approved by the controlling board in the first place. His biggest concern was the dorms, which he considered unsafe for students and which broke with Hershey's tradition of family-style group homes.

McNamara said the school hoped to find a new use for the Springboard complex by June. Some believe the complex could be taken over by the Hershey Entertainment & Resort Co., which is owned by the school. The school itself is exploring uses for the complex, she said.

Thinking ahead, Craven, 43, said Springboard could be a good retirement home for alumni.