Hands-on Philanthropists With a Proven Track Record, Ray and Barbara Dalio Announced in April They Wanted to Give $100M to Connecticut Schools. And Then Things Got Complicated

Barbara Dalio talks with Sheena Graham, a teacher at Warren G. Harding High School in Bridgeport, and her students. Graham serves on the board of the Partnership for Connecticut, which will oversee Ray and Barbara Dalio’s $100 million donation toward education and job training in the state. (Dalio Philanthropies)

For years, the Dalio Philanthropies worked quietly — and effectively — to improve the outcome for students in urban public schools in Connecticut.

Since 2010, the foundation has spent more than $50 million on developing community support groups, hiring extra staff for five inner-city high schools, funding teacher grants and awarding professional development fellowships that allow educators to study things like Shakespeare in England, or art in New York City.

The work, spearheaded by Barbara Dalio, whose husband, Ray, founded the world’s largest hedge fund and became famous for espousing management principles based on radical transparency, was conducted out of the glare of the national spotlight. Even as it was credited with increasing student success in Meriden, East Hartford, Hartford and New Haven, the swarm of public attention alighted elsewhere.

Then, in April, the couple announced an even larger gift to the state. Their foundation pledged $100 million over five years to benefit education and job training for youths aged 14 to 24.

They announced The Partnership for Connecticut in front of cameras at East Hartford High School. Connecticut Gov. Ned Lamont and his wife, Annie, joined the Dalios on stage. The couples are neighbors in Greenwich, though they didn’t know each other before Lamont became governor in January. The project would be a public-private partnership, with the state matching the Dalios’ funds with $100 million in taxpayer money and a plan for other private donors to contribute an additional $100 million.

The week of the announcement, Ray Dalio, who stepped down from running his Bridgewater hedge fund in 2017, went on the CBS news magazine 60 Minutes to talk about the perils of income inequality. While his net worth is now estimated at more than $18 billion, Ray Dalio longs for a society that provides the kind of opportunities he had as a middle-class kid growing up in Queens.

“I think the American dream is lost,” he told correspondent Bill Whitaker. “I think for the most part we don’t even talk about what is the American dream. And it’s very different from when I was growing up. It’s not redistributing opportunity. We can call it a wealth gap, we can call it an income gap. … It’s unfair and, at the same time, it’s unproductive and, at the same time, it threatens to split us. ”

But after the high-profile rollout of the Dalio gift, national attention zeroed in on Connecticut. Comparisons inevitably began to be made to Mark Zuckerberg’s $100 million, often-criticized donation to Newark schools.

“I can understand that there have been initiatives that haven’t worked, like the one in Newark, so I’m very aware of the possible mistakes in philanthropy,” Barbara Dalio said. “I have to say that when we work with our partners, with the districts, it’s a collaboration. We don’t tell them what to do; we hear from everybody. That’s how we come up with the decision to help them. I guess what I hear is that some foundations don’t do that and maybe that’s what the problem is.”

The rollout of Zuckerberg’s donation by state, city and school officials was widely seen as top-down and largely unaccountable to city residents. In retrospect, however, the reforms were shown to have a positive effect on a chronically troubled school system, with Newark students performing at significantly higher levels post-donation.

Unlike the young Facebook founder, Barbara Dalio didn’t just drop into Connecticut schools after an appearance on Oprah. A native of Spain who immigrated to America in her 20s, she has been involved in Connecticut schools since the youngest of her four sons left home more than a decade ago. Unlike most billionaire philanthropists, Dalio has regularly volunteered in the schools her foundation supports.

But the Zuckerberg donation offers another lesson — about privacy. And that has become a sticking point in the launch of The Partnership for Connecticut. Embarrassing emails between Zuckerberg and then-Newark Mayor Cory Booker, released under Freedom of Information laws, showed the aggressive public relations efforts that were made to position the Zuckerberg millions in a good light. After that, criticism of the effort — warranted or not — took on a life of its own.

The Partnership for Connecticut was set up as a nonprofit that would be exempt from Freedom of Information laws, even though the state would provide $100 million in public money and five elected state officials — including the governor — would sit on its 13-member board.

Since the spring, the fight over the Partnership’s FOI exemption has taken most of the spotlight. State Attorney General William Tong ruled in August that any communications with elected board officials would be subject to FOI, and in September, Republican leaders of the Legislature, who are members of the Partnership board, refused to sign off on approvals needed to put the Partnership into action. The education programs, which were supposed to start with the new school year, haven’t even been discussed yet.

After much delay, the board finally had its first meeting in October in New Haven. The Partnership devised a complicated, two-level board structure with the five elected state officials, who are subject to FOI laws, classified as “members” with voting rights and limited access to discussions. The eight other board members, who can discuss anything privately among themselves, are called “directors.” The distinction seemed irrelevant during the first meeting, which was held mostly out of public earshot, in executive session.

“I think philanthropies have been burned by this,” said Andy Smarick, director of civil society, education and work for R Street Institute, a conservative think tank. “Every time they try to give money to a big public cause, their emails come out and make them look bad.”

Smarick, who took over as New Jersey’s deputy commissioner of education in 2010, the year of the Zuckerberg donation, said that government grants go to nonprofits all the time without open access required of the nonprofits. But, Smarick said, the issue of transparency is different in education, where huge private donations can have an outsize effect.

“The question the public has to consider is: If freedom of information would stop a philanthropy from giving money, is that, on balance, a worthwhile trade?” he said. “Or, is it reasonable for a private philanthropist to say, ‘I’m giving you all this money; isn’t that enough? Do I have to let you read my email, too?’”

Gov. Lamont brushed aside questions of access at the first board meeting and said he was just glad the Partnership’s work can finally begin.

“We’re going to be making amazing investments in programs created by teachers to help kids who otherwise have been left behind,” Lamont said. “Most of the focus is on these disconnected, disadvantaged kids, getting them back and getting them through school and into a great job.”

Zeroing in on a critical year

The Dalio foundation’s work in Connecticut has been extensive. Its Connecticut Opportunity Project provides funding for community organizations that support troubled youth. In its education efforts, Barbara Dalio has also worked with charter schools, but she decided to concentrate on public schools.

“I remember when I came to the United States for the first time in my 20s, one thing that struck me was that through public education, people have really been able to have careers and obtain their dreams,” she said. “It was not like that for everyone in Spain. It’s really democratic and inclusive. I really always admire the public education system that this country has.”

Ray and Barbara Dalio’s foundation has invested $50 million in the past decade to improve student outcomes in Connecticut. The couple pledged an additional $100 million in April to education and job training. (Dalio Philanthropies)

The foundation has had its biggest impact on the schools, so far, through its Connecticut RISE Network, which includes East Hartford, Meriden, New Haven and Hartford Public Schools. Together the districts represent 60,000 students, or 10 percent of the state’s school-age population, and 20 percent of the state’s low-income students. RISE focused on five high schools in the four districts.

Erin Benham was president of the Meriden Federation of Teachers in 2015 when the district was first contacted by RISE.

“When we got the invitation, it was very clear that I had to be there along with administrators,” Benham said. “She wanted the teachers to be involved.”

Meriden, a district with 8,600 students in a working-class town in central Connecticut, had once gotten a technology grant from a separate foundation, Benham said, but the district was told exactly how to spend the money. The Rise Network was different.

“Every year, we would have a meeting with Connecticut RISE people,” said Benham, who retired in July. “We would tell them what our needs were and then decide together how to spend the grant.”

Meriden wanted to focus on easing students’ transition from eighth to ninth grade, a pivotal year that indicates how likely a student is to graduate in four years.

RISE paid for Meriden to provide a two-week orientation for incoming freshmen and the creation of a digital dashboard that would house all of a student’s data — test scores, attendance, goals — in one place. It also provided the money to hire four transitional specialists, guidance counselors who would work just with ninth-graders at the district’s two high schools.

“Transition specialist is one of the positions that the district needs that is not really funded through the city,” Benham said. “We couldn’t afford it otherwise.”

Liz Matthews, a ninth-grade English teacher at Hartford High School, said students who never experienced success found it with help from the RISE Network.

In her school, vulnerable freshmen — identified as those who have either low grades, poor attendance or more than one suspension — are assigned an on-track coordinator whose salary is paid by CT RISE.

Whereas Meriden hired guidance counselors, Hartford hired teachers and former Child Protective Services caseworkers to be on-track coordinators. Their goal: to create positive relationships. They visit students at home, take them on field trips and college visits and make sure the teenagers show up at school.

“The idea is to get them engaged in school, get them to want to come and get them on track,” Matthews said. “It’s really cool to see the creative things they come up with — maybe it’s an afterschool workout program, or guest speakers or workshops. You never know what will spark a student, so they try many different approaches.”

Essential to the Hartford program are regular on-track conferences in which students, parents, teachers and the on-track coordinator study the data on a student’s dashboard and make recommendations for next steps.

“The conferences are really helpful,” Matthews said. “I had a student who was never told he was smart, not told he could succeed, and in the last on-track conference of the year, he was told he was on track. He started to cry, he was so proud of himself.”

The on-track rates for ninth-graders in the RISE network over the past three years have improved by nearly 10 percentage points, from 70 percent to 80 percent, which nearly triples the likelihood of students graduating on time, said Emily Pallin, executive director of Connecticut RISE Network. The results for English learners and special education students are even better, with a 15-point gain in the same time frame, Pallin said.

College readiness rates improved as well, Pallin said. In 2015-16, only 29 percent of high schoolers had a B average or better. Two years later, 36 percent achieved a B average or better.

This year, the RISE Network has expanded to five additional districts, to serve a total of 13,000 students in 10 high schools. The network has an annual budget of about $4 million from the Dalio Philanthropies and has started receiving funds from other foundations as well.

“At her core, she is a learner,” Pallin said of Barbara Dalio. “She has always positioned herself not as the expert, but as someone who is going to come into a school district and listen. I just wish people would have the opportunity to meet Barbara. They may be expecting someone who is going to monopolize and run the show, but that is just not her.”

The biggest opposition RISE has met was in New Haven, where parents and education advocates questioned the use of student data and whether it was protected, Pallin said.

“We met with the community and explained that the data was just what was in a students’ school record, but it was all in one place so it was easily accessible when it was needed,” she said.

New Haven stayed in the program.

“We initially thought this would be time-bound, but we asked the educators in the network, ‘Do you want this to sunset?’” Pallin said. “They said ‘No, we don’t want this to be like other initiatives and fads in education. We want this to be the way we function.”

Finding untapped potential 

The Partnership for Connecticut’s plans to help strengthen communities with job training and small business loans was Ray Dalio’s idea, his wife said.

“I’m not an economist. I’m always looking for the education angle of what I can do, personally or as a foundation,” Barbara Dalio said. “He focuses on what works and what doesn’t work in the economy. What opportunities can we bring?”

A search is underway for the executive director of the Partnership, so decisions have yet to be made about what form the Partnership’s job training will take. But Erik Clemons was recruited to the board by Barbara Dalio and was voted its chairman at the first meeting, so his previous experience may provide a template for what the investment in jobs will look like.

Once a disconnected and disengaged youth himself, Clemons went on to start a New Haven nonprofit in 2012 that offers education and job training, the Connecticut Center for Arts and Technology, known as ConnCAT. The organization creates career pathways for unemployed and underemployed adults. Clemons met with Yale Medical Center and found out it needed people with skills in billing and phlebotomy, so ConnCAT offers training in that. Then Clemons looked at New Haven’s active restaurant scene and started training people for the culinary arts. Then he started an entrepreneurship academy, and he is now looking at property development.

“The compelling thing about the Partnership is that I can pay it forward now, not just with the work I do here, but as a member of the Partnership’s board,” Clemons said. “We are tapping into the potential of people who have been forgotten.”

Barbara, a hands-on philanthropist who visits schools several times a week to listen to students, ask questions of teachers or seek the advice of administrators, is eager for the Partnership to get started.

“I really learn best when I visit a district and talk to the teachers and the union leaders and the principal and superintendent,” she said. “Then I go back home and my dinner-table conversation with my husband is about the programs that we have. It takes a lot of time and resources. In the education part of the foundation, we have so far invested $50 million more or less. It feels like nothing sometimes because there is a lot to do.”

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