Billionaire Stephen Schwarzman had long list of demands in exchange for $25M donation to Abington High
The Abington School Board finally released a now-rescinded pledge agreement with billionaire Stephen Schwarzman to rename its high school after him. It includes a confidentiality clause and requirement that a commissioned portrait of Schwarzman be "prominently" displayed in the school, among other provisions.
His name on at least six entrances of the high school. A prominently displayed portrait of himself. His twin brothers' names elsewhere. Curriculum changes. Approval over building design and contractors. With all those demands to be kept as confidential as legally possible.
Those were highlights of a secret agreement the Abington School District reached last month with billionaire alumnus Stephen Schwarzman. The plan to rename the school after him in exchange for a $25 million donation sparked outrage from local parents and alumni around the country.
After two weeks of stonewalling, the district released the contract Wednesday morning, the day after school board members rescinded it and announced that they would vote on a new one with community input and far fewer requirements.
"When you're that rich and giving those level of gifts, you're really used to getting what you want," said Maria Di Mento, a staff writer and expert on big philanthropic donations at the Chronicle of Philanthropy.
In addition to renaming his alma mater Abington Schwarzman High School, the Blackstone Group CE O wanted his name on a new science and technology center and the ability to sign off on all public relations aspects of the grant "to assure maximum impact and visibility."
"I wouldn't be surprised if this was all done without considering how bad it was going to look to outsiders," Di Mento said. "This is a public school district. This is not Yale."
The school board made the deal public after voting unanimously to rescind it at a raucous meeting Tuesday night in favor of a watered-down version that it will vote on April 24. It also released information about a foundation that the district created last year to manage the unprecedented gift.
The board had approved the first pact —with little notice — March 27 to give naming rights to the 1965 graduate in return for money that would pay for a high school renovation and state-of-the art Center for Science and Technology.
Abington residents wanted to know what else Schwarzman, the 71-year-old son of a dry-goods salesman, who is worth about $12 billion, might be demanding.
Turns out it was a lot, with all communications — and the deal itself — to be kept confidential without approval from the deep-pocketed donor. Under the state's Right-to-Know law, most public school records are open for review.
Erik Arneson, executive director of Pennsylvania's Office of Open Records, said such agreements that involve government agencies are generally public records.
"If a contract is otherwise a public record, fancy confidentiality language doesn't make it nonpublic," Arneson said. "It's rare, but we've had circumstances where there is language in a contract or an agreement that basically says that neither party can disclose information. When a government agency is involved, those words don't stop the Right-to-Know law from applying."
Last week, the Inquirer and Daily News filed a Right-to-Know request for the Schwarzman agreement. The district had refused to release the document, saying it needed to conduct a "legal review" to determine if it was a public record.
The agreement also said Abington would provide Chromebooks to all high school students and require them to enroll in coding or computer literacy courses by 2022, which is when the new high school is expected to open. Superintendent Amy Sichel maintains the district had already planned that curriculum change and it did not come from Schwarzman.
However, to keep their benefactor up to date on the curriculum, the district would have been required to provide semi-annual progress reports on the teaching of coding and other computer skills, and hold semi-annual in-person meetings with Schwarzman's representatives on reaching computer literacy goals, the agreement says. After 2022, reports and meetings would be annual.
Schwarzman also wanted a say in the building of the new high school, demanding to review a list of general contractors and comment on final designs and cost estimates, while receiving quarterly progress reports.
Other space in the building would be named in honor of Schwarzman's brothers Mark and Warren. The gym, athletic center and athletic hall of fame would bear the names of his former track mates, Bobby Bryant and Billy Wilson, and his coach, Jack Armstrong.
Aaron Dorfman, president and CEO of the National Committee for Responsive Philanthropy, said the demands sounded excessive for a gift to a public high school.
"Naming opportunities are not at all unusual. That often comes with a large gift. But usually, those are gifts to private institutions, not to public, government-funded institutions like a school district," said Dorfman, who laughed when told of the requirement that the school hang Schwarzman's commissioned portrait.
As for the confidentiality requirements, Dorfman said: "I think that's crazy. This is a public school district, and it's a little outrageous to expect that kind of confidentiality."
The new pledge agreement, also posted Wednesday morning, lists far fewer demands.
Schwarzman's name will still grace the science and technology center and the gym complex will still have the names of his friends and coach. But there is no mention of his brothers and any pictures or plaques "will be mutually agreed upon" by the district and Schwarzman.
It also states that the school will immediately cease to use a name if the person has "engaged in any act of moral turpitude which results in a criminal conviction."
The new pact does not stipulate updates for Schwarzman on the computer science curriculum or building construction.
Gabrielle Sellei, an attorney and parent of two Abington students who had criticized the board's secrecy, said that after reading the original agreement it was "shocking" to find the confidentially requirement for a public school district "where every paperclip purchase is put out to bid and agonized over at public meetings." But it's also "understandable, given the heavy-handed demands Schwarzman made and won," she added.
She also pointed out that if Abington already requires computer literacy courses, "why would it need to be in the agreement?"
"Why are we contractually committing ourselves to a course of study for all future Abington School District students, apparently forever?" Sellei asked. "That is the school board abdicating its professional and fiduciary responsibilities to our students in exchange for $25 million."
A Schwarzman spokeswoman did not return a request for comment.
After the community blow-up, Sichel said, Schwarzman immediately backed off renaming the school. At the meeting on Tuesday, School Board President Raymond McGarry apologized repeatedly for the board's lack of transparency. He implored the several hundred people in the audience not to blame the district's patron.
Schwarzman's intentions, he said, "have been pure throughout this process."
"While this board is most deserving of criticism," said McGarry, "Mr. Schwarzman is only deserving of our thanks."