School board member should step down

Deborah H. Quazzo is in the wrong place at the wrong time. She should not be serving on the Chicago Board of Education while investing in companies that do millions of dollars in business with the public schools.

She should step down.

In a Monday Watchdog story, Quazzo told Sun-Times reporter Lauren FitzPatrick that she keeps her roles on the board and in her venture capital business completely separate, but that is irrelevant. The appearance and very real potential for abuse are unavoidable. This can’t be fixed.

Full disclosure of all business dealings with the school system or individual schools, where Quazzo has fallen short, would not solve the problem. Nor is it enough that she recuses herself from school board votes on contracts with companies in which she has a financial stake. Her mere presence on the board can cast a shadow of doubt on CPS business dealings that may, in fact, be perfectly appropriate.

FitzPatrick notes several instances, for example, when one of Quazzo’s companies cut its prices so that its bills to CPS fell just below the $25,000 threshold that would require approval by CPS officials. That may be a fairly common streamlining practice for many companies, but a skeptic could be excused for suspecting it’s a way for Quazzo’s companies, given an unfair advantage, to fly under the radar.

The irony is that Quazzo may find herself in this awkward spot, being written up in the press in a less than flattering light, precisely because she has poured her energies, both as a businessperson and civic-minded Chicagoan, into the worthy pursuit of improving public education. She is the rare venture capitalist who, admirably, invests in education businesses, a sector traditionally viewed as not all that profitable.

Since Mayor Rahm Emanuel appointed Quazzo to the school board last year, CPS has tripled its total payout to businesses in which Quazzo has an ownership stake. From 2010 to her appointment in June 2013, CPS paid about $930,000 to her businesses. Since then, CPS has paid an additional $2.9 million.

In all, FitzPatrick reports, five companies in which Quazzo has a stake have been paid more than $3.8 million by CPS for ACT prep or online help with reading, writing and math. One of the firms stands to collect another $1.6 million from a CPS contract.

Quazzo listed only two of the five companies on her most recent ethics statement, which a CPS spokesman defended as proper because the other three companies did business directly with individual schools. That may be the case — the letter of the law was respected. But clearly not the spirit.

Quazzo’s defense is that she was unaware of the growth in business her companies were doing with CPS, concerning herself only with the quality of the products she invests in, not specifically where they are used. She essentially is offering a “trust me” defense in a town that has learned the hard way, over many decades, not to trust when it comes to public contracts.

Equally troubling, CPS’ chief executive officer, Barbara Byrd-Bennett, and another school board member, Mahalia Hines, have been among the speakers — all expenses paid — at an annual education investment conference Quazzo co-sponsors in Arizona. Another school board member, Andrea Zopp, also is a past speaker at the event, but paid her own way.

The tight intertwining of business and CPS interests here is simply wrong.

Deborah Quazzo may be the best kind of venture capitalist, one motivated by high ideals as much as profit. And we would hope she continues to contribute to the cause of quality education through her investments and philanthropic work.

But it is inappropriate for her to sit on the Chicago Board of Education.

— The Sun-Times Editorial Board