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Few checks, balances for Facebook founder's $100 million grant for Newark schools

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Facebook founder Mark Zuckerberg is giving the city of Newark $100 million to improve its schools. But without checks and balances, is the project doomed to fail?

Trust.

That's all that Mark Zuckerberg is relying upon for his massive grant of $100 million to be used to improve the education system in Newark, N.J.

Announced this week -- with New Jersey governor Chris Christie, Newark mayor Corey Booker and even Oprah Winfrey herself in tow -- the gift by the 26-year-old founder of the massively popular social media site Facebook has been met with acclaim, criticism and confusion.

The acclaim: Millions of dollars to improve the schools of Newark, a troubled city by most measures.

The criticism: That the gift comes just as a highly critical movie about Zuckerberg, The Social Network, hits theaters.

The confusion: Newark? (Zuckerberg is from White Plains, N.Y. and attended school in Cambridge, Mass.)

But in a conference call with the mayor, governor and Zuckerberg himself, it became clear that there was little more than a gut feeling guiding Zuckerberg's $100 million investment to make Newark "a hotspot for education."

First, some background. Zuckerberg says he "spent a lot of the last year researching myself what the most leveraged ways are to impact the education system of this country."

With admiration for organizations like Teach for America and KIPP schools, Zuckerberg said he wanted to "go into a place that's ready for real reform, that has great leaders, and give them the resources they need to flexibly try out new programs -- that's why Newark is the perfect place to do this right now."

Impressed by Booker's "personal commitment" to Newark after meeting him at a conference, Zuckerberg formed a foundation called Startup: Education that would administer a grant to fund -- with plenty of flexibility, he stressed -- educational initiatives in the city.

Here's how it works: the foundation has been stocked with Facebook shares. It will sell those as needed to raise cash, which will then be used for educational initiatives. Booker's staff will distribute the funds with guidance "from the community."

The mayor's three pillars of interest:

  • Focus on teachers. "We believe we need to support and empower teachers."
  • Ensure accountability for everyone, from teachers to community leaders to politicians. "Nobody gets a pass...failure cannot be tolerated."
  • Create and support schools that succeed. "Our bias is towards schools of excellence."

"We have phenomenal schools...but we also have lousy schools," Booker said, adding that he was putting his career on the line with the project. "We have got to get out of the blame game -- stop pointing fingers and accept community responsibility."

The grant is for multiple years, which is contingent on Newark city officials meeting certain benchmarks. During the call, several reporters pressed Booker and Zuckerberg to elaborate on what those benchmarks might be.

Both avoided the question.

What Zuckerberg did acknowledge is that none of the $100 million was earmarked for specific purposes, such as primary school education, or language instruction or arts programs.

"We need to listen to the community and find out what we're spending the money on," he said.

When asked how involved the Facebook founder would be with the project, Zuckerberg admitted -- three separate times during the call, in fact -- that "I spend all of my time running a company" and that he's looking to invest in "people I believe in," rather than run a foundation, because of his limited attention.

"This is the guy I want to invest in," he said, referring to Booker.

Christie added that the project would start with a "framework" to build out "communications" to facilitate later action.

"This is a multi-year effort that's got to start now," he said. "We're not going to try and transform the entire Newark school system in the next six months.'

Booker was more optimistic.

"Newark is a word that's synonymous with excellence," he said. "We have a calling here in Newark...to be the bold model to the nation to how a community can work together to create [profound] change."

Zuckerberg also explained his interest in philanthropy, saying: "Education has been something that's really important in my family...the real question is when we were going to get involved."

"Teaching really needs to be revered as a profession," he said, adding that his girlfriend, Priscilla Chan, was at one point a teacher.

He said the unfortunate timing of the project -- coinciding with the wide release of a fictional film based on his company's founding -- "was really driven by the needs of Newark."

"I was thinking about doing it anonymously," he said. Christie said he and Booker pushed for Zuckerberg's name to be attached to the donation.

But the big question on everyone's mind is whether Zuckerberg, in his first philanthropic endeavor, has just thrown away $100 million by not being more specific on how his funds will be disbursed.

If the project is a success, it's no doubt a win for everyone involved, for both politicians (each with just over three years on their term) and Zuckerberg.

But if it doesn't work, will it be too pricey a lesson learned?

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Andrew Nusca

Editor Emeritus

Andrew Nusca is editor of SmartPlanet and an associate editor for ZDNet. Previously, he worked at Money, Men's Vogue and Popular Mechanics magazines. He holds degrees from the Columbia University Graduate School of Journalism and New York University. He is based in New York but resides in Philadelphia. Follow him on Twitter. Disclosure