2006 KIPP Foundation Annual Report

Page 1

2006 annual update


KIPP’s History at a Glance 1994: KIPP (Knowledge Is Power Program) is

co-founded by teachers Mike Feinberg

and Dave Levin as a public-school program

for fifth-grade students from inner-city

Houston, TX.

1995: New York Board of Education and Houston

Independent School District invite Feinberg and Levin to expand their programs. In

response, they found the KIPP Academies in both Houston and New York.

2000: Doris and Donald Fisher, co-founders of Gap Inc., form a partnership with Feinberg and

Levin with the goal of replicating the model

and success of KIPP’s two founding schools.

Together, they establish the KIPP Foundation.

2006: The KIPP network grows to 52 public schools

serving over 12,000 students in 16 states and the District of Columbia.


Dear Friends, Every weekday morning, over 12,000 students living in some of the most under-resourced communities in the United States make their way to a KIPP (Knowledge Is Power Program) school. Unlike millions of other American public school students, children who attend KIPP start their day at 7:30 a.m. and continue their studies until 5:00 p.m. They attend school every other Saturday and for a period of three to four weeks during the summer. All KIPP students, their parents or guardians, as well as their teachers have made the commitment to spending longer hours in school than our public educational system typically requires. Why? The reason is simple: the results demonstrate that increased instructional time coupled with highly effective teaching and learning, enables children to achieve at higher levels. In spite of these results, every year a Gallup poll reveals that 74 percent of Americans believe that the gap in academic achievement between children growing up in low-income households and those who do not is unrelated to the quality of education they receive. In fact, the general public believes that the absence of three main factors contributes to poor school performance: parental involvement, a strong home life, and interest on the part of low-income students.

in Houston and New York, to a network that now comprises 52 public schools based in 16 states and the District of Columbia. As we are fond of saying, “The actual proves the possible.”

At KIPP, we believe that children can succeed regardless of their family’s socioeconomic background or life circumstances, and we have built our network of schools around this fundamental conviction.

We are committed to disproving the widely held assumption that school cannot significantly impact the lives of low-income students. To that end, we are planning, over the next five years, to double the size of our network while continuing to improve the quality of education we offer to our students.

At KIPP, we have seen how more time spent working at school, an emphasis on college preparation, and a strong culture focused on character development enable KIPP students to achieve academic excellence and attain their goals. Every day, KIPP students, teachers, and school leaders demonstrate that through hard work, children growing up in America’s most under-resourced communities can change their reality and create a better life for themselves and us all.

In the annual update that follows, we will outline the highlights of 2006, the tremendous academic gains being made by our students, and our plans for expansion. We ask you to join us in this effort and we encourage you to visit a KIPP school near you. When you do, be prepared to be inspired.

In only five years, the KIPP Foundation has created a powerfully constructive example of what is possible in public education, having implemented an educational philosophy that has produced visible results. During this time, we have expanded our network from two founding schools, located

Sincerely,

Richard Barth President and CEO KIPP Foundation 1


The Next

Five Years

During the winter and spring of 2006, the

Over the next five years, KIPP plans to double

KIPP schools came together to review our

an expansion we believe will best enable us to

leadership of the KIPP Foundation and

accomplishments and to establish our goals for the future, along with a plan to achieve them.

the size of our network from 52 to 100 schools, continue to deliver on the promises we make to the students and families we serve.

We reaffirmed our primary commitment to

We resolve to engage only in those activities that

support a network of free, open-enrollment

quality of our schools. What follows are the results

fulfilling our mission: to continue to build and

public schools that prepare students for

success in college and life after college.

allow us to further our growth, while improving the of our work and a description of some of the core activities and initiatives for the year ahead.

Over 400 aspiring school leaders applied to the KIPP School Leadership Program in 2006.

= KIPP school

= KIPP transformation school 2


Schools KIPP Delta College Preparatory School

KIPP Heartwood Academy

KIPP TECH VALLEY

KIPP Academy Fresno

KIPP Summit Academy

KIPP Sankofa Charter School

KIPP Academy of Opportunity

KIPP Sunshine Peak Academy

KIPP Academy New York

KIPP DC: AIM Academy

KIPP AMP Academy

KIPP DC: KEY Academy

KIPP Infinity Charter School

KIPP DC: WILL Academy

KIPP STAR College Prep Charter School

KIPP South Fulton Academy

KIPP Reach College Preparatory

KIPP WAYS Academy

KIPP Tulsa College Preparatory

KIPP Ascend Charter School

KIPP Philadelphia Charter School

KIPP Lead College Prep Charter School

KIPP DIAMOND Academy

KIPP Indianapolis College Preparatory

KIPP Academy Nashville

KIPP Believe College Prep

KIPP Austin College Prep

KIPP Academy Lynn

KIPP TRUTH Academy

KIPP Ujima Village Academy

KIPP 3D Academy

KIPP Harbor Academy

KIPP Academy Middle School

KIPP Gaston College Preparatory

KIPP DREAM Prep

KIPP Pride High School

KIPP Houston High School

Freedom Academy, a KIPP school

KIPP Liberation College Prep

Rise Academy, a KIPP school

KIPP SHINE Prep

Helena, AR Fresno, CA

Los Angeles, CA

KIPP LA Prep

Los Angeles, CA

KIPP Bridge College Preparatory Oakland, CA

KIPP Adelante Preparatory Academy San Diego, CA

KIPP Bayview Academy San Francisco, CA

KIPP SF Bay Academy San Francisco, CA

San Jose, CA

San Lorenzo, CA Denver, CO

Washington, DC Washington, DC Washington, DC

South Fulton, GA Atlanta, GA Chicago, IL Gary, IN

Indianapolis, IN

New Orleans, LA Lynn, MA

Baltimore, MD

Edgewater, MD Gaston, NC Gaston, NC

Camden, NJ

*KIPP Transformation Schools: Cole College Prep Denver, CO

McDonogh 15 School for the Creative Arts

Newark, NJ

Buffalo, NY

New York, NY New York, NY New York, NY New York, NY

Oklahoma City, OK Tulsa, OK

Philadelphia, PA Memphis, TN Nashville, TN Austin, TX Dallas, TX

Houston, TX Houston, TX Houston, TX Houston, TX Houston, TX Houston, TX

TEAM Academy, a KIPP school Newark, NJ

KIPP Spirit College Prep Houston, TX

KIPP Aspire Academy San Antonio, TX

New Orleans, LA

New Orleans West (NOW) College Prep New Orleans, LA

* Transformation schools are existing public schools that KIPP has taken responsibility to improve over time.

Albany, NY

3


Constant

Improvement

The KIPP network is dedicated to preparing each of its students to succeed in college and life after college. Regardless of our individual roles in

fulfilling the KIPP mission, this unifying commitment pushes all of us at KIPP to undergo rigorous reflection, to identify challenges, and to seek

better ways to reach our collective goals. Bolstered by the KIPP Foundation’s leadership training program, professional development for teachers, and the sharing of best practices across the network, KIPP schools continue to strive for excellence. Among our top priorities for the 2006-2007

school year are strengthening our leadership training programs and raising the bar for English language arts student achievement.

School Leadership As the KIPP School Leadership Program is completing

Raising the Bar for English Language Arts Student Achievement

its seventh year in existence, we are simultaneously

A survey of KIPP Alumni revealed that an overwhelming 80

continually reevaluating the content and delivery

given them the best preparation, while English language

recognizing and building upon our successes and

mechanisms of our program, which offers training in

percent picked mathematics as the area where KIPP had

arts (ELA) ranked as the area where they felt least

instructional, organizational, and operational leadership

prepared by KIPP. Indeed our own data shows that while

to improve upon our world-class school leadership

achievements in mathematics are stronger.

to aspiring school leaders. Our goal is twofold: to continue

training, as well as to expand upon our program offerings. Looking ahead, we are focused on making sure we are

deepening the leadership capacity in our schools at all

levels and are particularly focused on ensuring we are

building the necessary bench depth to support strong

succession planning.

our students have posted outstanding gains in ELA, their

We are now in the process of identifying strategies to

improve upon KIPP’s methods for teaching strong reading

and writing skills, beginning with upper-middle school

grades and continuing through high school. One such

activity involves documenting and sharing the highly

effective reading and writing curriculum and practices

This year’s KIPP School Leadership Program enrolled 48

of KIPP STAR College Preparatory School (Harlem,

Twenty participants are future KIPP administrators and

Academy Middle School (Houston, TX); and KIPP Gaston

participants, 11 of whom are future KIPP school leaders.

17 are school leaders with educational organizations

partnering with KIPP, including Achievement First, the

NY); TEAM Academy, a KIPP school (Newark, NJ); KIPP College Preparatory (Gaston, NC). We believe that

the combination of professional dialogue among KIPP

Center for Charter School Excellence in New York City,

educators and focused action will enable us to provide all

Milwaukee College Prep, Noble Network of Charter

students for high school, college, and life.

Indianapolis Public Schools, Lighthouse Academies,

Schools, and Uncommon Schools. We have been able

KIPP schools with the tools needed to better prepare their

to do this thanks to The Broad Foundation, Doris and

Don Fisher, The Walton Family Foundation, and the US

Department of Education, who have all invested in KIPP’s

School Leadership Program.

4


Since the origin of KIPP, the two founding KIPP schools continue to exceed the college matriculation rates in their communities, with 80 percent of alumni who completed the eighth grade attending college.


“KIPP is a hungry and open-minded organization, willing to reconsider things that we once held as truth.” “We’ve had a good measure of success up to now, but we have to always ask ourselves how much better we can be doing. To be more successful, we may have to change. We simply can’t be complacent. We have to constantly assess everything we do. We don’t want to become attached to a particular way of doing something, rather than doing what’s really best for the kids. We like to think of our approach as that of a world-class athlete who constantly works to find the best way of making even the most incremental improvement in his or her performance. In baseball, for example, the difference between a .333 batting average and a .250 batting average, is one more hit for every 12 at-bats. The 1/12th factor, as we call it, marks the difference between a superstar and an average player. The difference between greatness and mediocrity is in the smallest of details and they must be attended to. This is how we try to work at KIPP. It’s what makes KIPP great. It’s what helps our kids build a better tomorrow for themselves and us all.” David Levin KIPP Co-founder Superintendent of KIPP NYC


Supporting Excellence through

Smart Growth

Since its founding in 2000, the KIPP school network grew from two to 52 schools. During that time, KIPP has also dramatically increased the

number of communities we serve, from two to 36 communities, across 16 states and the District of Columbia. Looking ahead, the KIPP Foundation has committed to a growth plan that will lead to the doubling of the number of schools in our network over the next five years. Our first priority is executing a plan that will lead to better support for our schools and the kids they serve, ensuring that we are in a position to deliver on our

commitment to prepare our students for success in college, life, and in the years and decades ahead. We call this ‘Smart Growth,’ and central to this

plan are a few basic commitments: first, we

will open the majority of new schools within

the communities we already serve. Focusing on

regional growth, we support the development of

local resource centers that will provide critically

important support services, such as operations, facilities management, fundraising, and high-

school placement to each group of schools. This model will improve upon the quality of support services each school currently receives, and

more importantly, will ensure that our school

leaders are able to remain focused on student

achievement, professional development of

teachers, and the needs of families. At the close of the 2005-2006 school year, one in five KIPP

schools operated with the support of a local

resource center. By the end of the 2007-2008

school year, we expect to have the majority of our

schools benefiting from this kind of support.

The second commitment to our ‘Smart Growth’

effort is to expand beyond serving our kids solely during the middle-school years. Our experience

to date has convinced us that preparing our kids

for success in college and in life can be made less

challenging by starting earlier and staying with our students for more than four years.

Paving the way in our efforts are Washington,

DC; New Orleans, LA; Newark, NJ; New York,

NY; and Houston, TX. Over the next five years,

we expect to expand to over 35 schools in these

regions alone. In addition, local resource centers

are being created in Chicago, IL; Atlanta, GA; and

the San Francisco Bay Area. In the San Francisco

Elementary and High School Programs Elementary Programs

On average, our middle school students enter the fifth grade reading two grade

levels behind, a trend we are working to change. Given the success of KIPP SHINE

Prep (Houston, TX), the first early-childhood/elementary school, we see that we

are changing this trend by working with students earlier in their academic careers.

More than 95 percent of the students who are attending KIPP SHINE Prep entered

pre-K as non-readers, and more than half were non-native speakers (this indicates

they speak a language other than English at home). By the end of the school year,

students were performing above mid-year Kindergarten level in reading, writing,

and letter-naming fluency in both English and Spanish.

We would like to see more students excelling in school at an earlier age and imagine

limitless possibilities for those who do. As a result, we are committed to replicating

the success of KIPP SHINE Prep by creating additional elementary schools in existing KIPP communities.

High School Programs

A generous grant from the Bill and Melinda Gates Foundation in 2003 helped to

launch KIPP’s high school development program. The early results from our first two

high schools, KIPP Houston High School (KHHS) and KIPP Pride High School (Gaston,

NC), are promising. At KHHS, students reached 100 percent proficiency in English

language arts and 90 percent in mathematics on state tests, far outdistancing

district and state averages. KIPP Pride High reached 97 and 93 percent respectively

in English and mathematics, ranking the school among the top in the state. By

offering a college-preparatory curriculum which includes Advanced Placement,

college courses, and national and international summer programs, our students

are supported as they develop the skills necessary for independent study and the

academic rigors of college education. New Site Development

Responding to frequent inquiries from communities asking, “How can we bring a

KIPP school to our community?” the KIPP Foundation released its first ever New Site Development Request for Proposal (RFP) in the summer of 2006.

Bay Area, KIPP schools have already begun to

Six competitive proposals were received, and the cities proposals of Columbus, OH

applications, fundraising, and facilities planning.

interest and support captured in their proposals. Both of these communities

work collectively on activities such as charter

and Minneapolis/St. Paul, MN were selected based on the broad-based community

have committed to opening multiple KIPP schools over time starting in 2008, all

supported by a strong local resource center. 6


test results of students attending KIPP Pride High School in Gaston, NC place the school among the top performing within the state.


“Attending KIPP Pride High School has left an impact on me beyond what words can say. ” “After coming from a school where expectations were low and becoming valedictorian was a simpler task then it sounds, I thought I could zoom through any college. KIPP Pride High School proved me wrong and opened my eyes to a world that most teens living where I live will never see. I now know there is so much more that I must do and learn in order to earn acceptance to the college of my choice. My peers and I are being empowered with the skills and traits of the leaders who have changed our world. KIPP changes students and the way they view education. A student could come in with plans of dropping out and in one day at KIPP, know the college that they WANT to attend. A student could enter our school apathetic or unprepared and become a motivated student who knows where they want to go to college and how they want to positively impact our world.” Joshua Sophomore at KIPP Pride High School Gaston, NC

“KIPP takes the extra step to help students achieve.” “With the support from my teachers, I can maximize my time, allowing me to play sports, do internships, and have experiences I wouldn’t have anywhere else. Experiences like these help me identify where I want to go to college and what I want to study. The KIPP environment has given me the confidence to reach for more. I have grown more at KIPP Houston High School than I have anywhere else. I have also witnessed my sister, a first grader at KIPP SHINE Prep, receiving the education she needs to excel. It is easy to see that the more time KIPP has with kids, the better it can serve them. She will do much better than other kids because she is learning what she’s supposed to at a younger age.” Navid Junior at KIPP Houston High School Houston, TX


Measuring Our

Effectiveness

At KIPP, we measure our progress both throughout and at the end of each school year.

Existing efforts enabling us to do this include: : School inspections, which allow our schools

to conduct ongoing improvement planning;

: School data collection and analysis, which also supports school improvement. The

School Inspections School inspections guide our schools toward ongoing improvement, and they help

the KIPP Foundation identify those schools employing strategies with positive

end results as well as those requiring extra support. Additionally, inspections have

helped us identify further opportunities for the KIPP Foundation to improve our

results of the analyses are disseminated to

schools’ ability to serve students. Such initiatives include strengthening the training

The KIPP Report Card; and

planning, and other efforts supporting sustainability.

the public via an annual publication called

: Third-party studies, which provide an unbiased evaluation of our progress.

we provide school leaders and staff around school operations, finance, succession

School Data Collection and Analysis

These programs hold us accountable, help us to

With the support of a grant from the Michael & Susan Dell Foundation, our Analysis

in maintaining our relentless focus on results.

and analyzing school information and student performance data. Our work over the

achieve excellence within our schools, and assist us

and Improvement Services team has made promising strides in collecting, storing,

last year has bolstered our ability to identify key trends in academic achievement. In addition, we have introduced a web-based reporting tool that enables KIPP schools to access and analyze individual student performance data and to monitor overall

school progress. Our efforts to collect targeted data about our schools and students

for the purpose of strengthening school and student performance will continue

over the next year.

Third-party Studies In 2006, SRI International released a report marking the end of the first year in a

three-year evaluation, highlighting key findings related to the learning environment

and student achievement at the five KIPP San Francisco Bay Area schools in

Northern California. The study, supported by a grant from The William and Flora

Hewlett Foundation, found that “Based on publicly available California Standards Test (CST) data for two years, the percentage of students scoring proficient or

above is consistently higher for KIPP schools than for comparable schools in the

neighborhood, in a few cases, dramatically so.”

Independent, third-party reports offer insight into what works well at KIPP schools,

while identifying areas for further improvement. In 2007, we will seek to identify an

independent organization to carry out a long-term, scientifically-based evaluation.

Thanks to funding from The Atlantic Philanthropies Services, we will be able to

commission a study, which will examine the true impact KIPP has on the students

we serve – something we call the “KIPP effect” – as well as help us understand how

we can strengthen the quality of education we are providing our students.

8


In the summer of 2006, Nine new KIPP schools opened in Washington, DC; Gary, IN; New Orleans, LA; Newark, NJ; and Houston, TX.


“The fifth-year KIPP Inspection experience greatly benefited the teachers and students of KIPP 3D Academy. ”

“We very much enjoyed both the recognition of our successes and the critical feedback delivered by

the experienced and knowledgeable British and KIPP inspectors. From their feedback, we at KIPP 3D,

together with our teachers and a curriculum consultant, developed an audacious set of goals to solidify our curriculum and strive towards assuring excellent instruction in all classrooms. While the inspectors

identified many of the problems of which we were already aware, they articulated our deficiencies in a

frank, clear manner, and offered a myriad of strategies and solutions toward school improvement—many of which we have followed. As a result, nine months later, we have had our best year of professional development. Our new teachers have never been better prepared for the beginning of school and our returning teachers are very much motivated to refine a school-wide vertically aligned curriculum and set of structures that will allow KIPP 3D Academy to best serve the students of Northeast Houston for decades to come.”

Dan Caesar School Leader KIPP 3D Academy Houston, TX


Strengthening

the KIPP Network

Over the next five years, the KIPP Foundation must be prepared to serve a network of more than 100 schools. It is critical for KIPP to continue investing in the development of our infrastructure and talent in order to remain a viable organization. This year, the KIPP Foundation has set priorities that will enable us to build upon our success and create an organization consistent with the scope of our aspirations.

At the Foundation, our priorities include:

Local Boards of Directors

: Building a diverse leadership team that

Each KIPP school or regional cluster of schools is governed by its own board. Our

: Re-engineering our performance review

the evaluation of school performance, and for ensuring proper systems of

models our core values.

process and utilizing “360-degree” feedback systems for all managers to ensure

accountability and performance across the entire organization.

: Diversifying our funding base so that no single donor accounts for more than 20

percent of our annual funding. While KIPP

has made tremendous strides in obtaining

financial support in addition to the $40

million in total donations granted to us by

Doris and Donald Fisher, co-founders of the

Gap Inc. , there is more progress to be made.

: Building scalable information technology

systems to improve the collection, storing, and sharing of data and information with our schools, as well as to meet internal

availability, security, and performance targets.

Thanks to a partnership with New Profit, the national

venture philanthropy fund, we are working with The

Monitor Group to address key network decision rights

issues with respect to the governance, expansion, and

evaluation of schools.

local boards are responsible for determining the feasibility of school expansion,

governance and financial oversight.

To support and strengthen these local boards, we have launched key initiatives

aimed at building a community of board members who share best practices

and who have access to training and resources that foster effective governance

practices. In February 2007, 42 board members represented the 36 operational

KIPP school boards at the inaugural KIPP Board Chairperson’s Retreat in Chicago,

IL. It is estimated that board member attendance at the 2007 KIPP School

Summit will more than double last year’s 30 attendees. Other key initiatives

include a monthly electronic newsletter (the KIPP Board Bulletin), a board

website and resource library, and quarterly web seminars on topics of interest

to the local board community. Business Operations Training

Until recently, KIPP has invested heavily in the development of school leaders

and teachers, with less emphasis on our business operations community. In the coming year, we will seek to balance the two, recognizing that both elements

are critical to our long-term success. KIPP schools have particularly challenging

growth plans, as they are required to double in size during their first year in

operation and add one grade level each subsequent year until reaching full

capacity. We recognize that the strain associated with the annual growth plan

of KIPP schools can be minimized with the collective help of the KIPP network. KIPP’s seasoned business operations community includes more than 90 Chief Financial Officers, Chief Operating Officers, Business Administrators, and

Office Managers from a wide range of industries. These individuals manage

critical non-academic functions that help to sustain our schools. They are

now able to connect with one another through regional training programs,

quarterly conference calls, and web seminars. KIPP Foundation staff is building

a web portal for resource sharing, identifying shared vendors and negotiating

favorable contracts, as well as defining standards for operational excellence.

We see this as a key initiative for our network, and one that will allow our

schools to focus even more intensely on the needs of our students.

10


Over 200 stories were highlighted in the media about the academic accomplishments of KIPP students.


“Each year, Doris and I continue to become even more excited about the potential of KIPP with the hope that KIPP will demonstrate that under-served kids are as capable of achieving at the same level as those who are not.” “We also hope that KIPP will have a positive influence on the greater

system so as to raise the educational quality for all kids in public school. To that end, Doris and I received a letter from Ryan Hill, Executive

Director of TEAM Academy, a KIPP school in Newark, NJ, that confirms the importance of our commitment to KIPP. In his letter to us, Mr. Hill shared the following story:

On September 8, 2006, one of our students walked into a

classroom at a boarding school in Connecticut for the first

time. This student was born homeless and lived in a car until

she was two years old. Throughout her school age years, she had overcome obstacles that would have stopped almost anyone in their tracks. But not this young woman. Her

desire to design buildings had her reading The Fountainhead as I drove her to school each morning and home each night. She is now taking classes at a high school that will prepare

her for any school of architecture in the country. This student stuns people with her intelligence, her humor, and her ease with people of all ages and all kinds, she will be able to do anything she wants with her life.

Mr. and Mrs. Fisher, I am sure that like our school, every KIPP

school has dozens, if not hundreds of students like her. You

have paved the way for an organization that I truly believe will one day alter forever the life prospects of all of our nation’s students.

Doris and I want to make sure that all kids have the opportunity to

become successful. We can see that KIPP schools are achieving this impact with their students.”

Doris and Donald Fisher Co-founders of Gap, Inc.


KIPP Foundation

Financials

Over the last four years, the KIPP Foundation’s budgeted operating expenses have increased from $10.2 million to $13.7 million. As illustrated

by the graph below, this modest increase occurred at the same time that the network nearly doubled in size from 27 to 52 schools. During this

period of growth, the academic results achieved by KIPP schools have been their strongest ever. During the 2005-2006 school year, our fifth grade

students posted stronger academic gains than during any other year in our history, and our schools in Helena, AR; San Lorenzo, CA; Washington,

DC; Baltimore, MD; Northampton County, NC; Bronx, NY; and Alum Rock School District in San Jose, CA were the highest performing non-selective public middle schools in their communities.

-

The KIPP Foundation’s efforts to grow our network

-

of schools are supported by a growing number of

investors. Doris and Donald Fisher, our co-founders,

-

have provided 60 percent of the Foundation’s

-

3CHOOLS 4RANS 3CHOOLS

operating capital during the first five years, with

grants totaling approximately $40 million. Thanks to

their generous support, the KIPP network stands at 52

3CHOOLS 4RANS 3CHOOLS

3CHOOLS

schools today. Other key supporters have also played

critical roles in the growth of the KIPP network. The

3CHOOLS

Walton Family Foundation, Bill and Melinda Gates

Foundation, The Broad Foundation, Michael & Susan

Dell Foundation, and Jack Kent Cooke Foundation have

all made critically important contributions to KIPP.

3CHOOLS

In January of 2006, a five-year funding diversification effort was launched, aimed at expanding our base of

supporters. Our goal is to ensure that no single source

+)00 &OUNDATION /PERATING %XPENSES

of funding accounts for more than 20 percent of our revenues. At the time of this report’s publication,

REPRESENTS BUDGETED EXPENSES

several new investors have taken leadership roles

in this diversification effort. Most prominently, The Atlantic Philanthropies and Robertson Foundation awarded multi-year grants of $14.6 million and $8 million respectively.

Over the next five years, the KIPP Foundation will also benefit from annual increases in the fee revenues

collected through license agreements with KIPP

schools, registration for key conferences, and tuition

for those attending the KIPP School Leadership

Institute. In 2006-2007, fee revenues are expected to total nearly $800,000.

12


Supplemental Schedule of Operating Revenues and Expenses (unaudited) For the Year Ended June 30, 2006

Revenues, Gains and Support:

$

Total

10,834,763

Statement of Financial Position (unaudited) Assets Current Assets: Cash and cash equivalents

Contributions Federal grant

873,796

Contributed services

315,172

Service fee income

565,430

Investment income

85,438

Miscellaneous income

55,624

Loss on sale of assets

Program loans receivable

889,962

Federal grants receivable

703,929

Prepaid expenses

556,015

Notes receivable, current portion, net of allowance of $144,314 and $13,600, respectively

728,384 12,347,392

Total current assets Notes Receivable, net of current portion

455,179 306,617

2,179,276

Furniture and Equipment, net of accumulated depreciation of $306,320 and $211,751, respectively

School start-up

2,525,442

Deposits

On-going school support

4,664,746

Research and improvement

262,992

Total program services

9,632,456

Total assets

Lines of credit

428,430

Fundraising Total support services Total Operating Expenses

407,647

Accrued expenses

748,130

Due to schools

2,390,559

Capital leases, current portion

21,216

(408,427)

Note payable, current portion

700,000

Unearned service fees

368,760

1,347,448 (1,755,875)

1,000,000

Accounts payable

Total current liabilities

Changes in Total Net Assets

$

13,138,578

Changes in Operating Net Assets KIPP Grants to Schools

$ 13,162,731

Current Liabilities:

3,077,692

Administration

53,543

Liabilities and Net Assets

Support services:

2,297,662

Contributions receivable, current portion

Leadership development

29,428

Contributions Receivable, net of current portion

Programs services:

2,239,732 4,902,280

Cash and cash equivalents - held for KIPP schools

12,730,151

Operating Expenses:

$

Cash and cash equivalents - restricted

(72)

Total revenue, gains, and support

2006

June 30,

Capital Leases, net of current portion

5,636,312 75,045

Note Payable, net of current portion Total liabilities

5,711,357

Net Assets: Unrestricted net assets Temporarily restricted net assets Total net assets Total liabilities and net assets

13

366,071 7,085,303 7,451,374 $ 13,162,731


The KIPP Foundation is in the first year of a five-year campaign to

diversify our funding base as we grow our network from 52 to 100 schools. To do so, we need your help.

Please visit us at www.kipp.org.

We would like to thank the following for their contribution to the KIPP Foundation. $5,000,000 and above

Under $25,000

Ryan Fuson

Co-founders

Gregory Alexander

Gap Foundation

Richard Barth and Wendy Kopp

Josh Greenman

Mark Bennett

Carroll Hendricks

Jonathan and Miriam

George and Leslie Hume

John and Amy Buonassisi

Pamela Johnson

Doris and Donald Fisher,

Anonymous

Gage Family Foundation

Jyoti Parekh

The John and Lisa Pritzker Family Fund

Seth Andrew

Daniel Gennari

Kevin Parke

Atlantic Philanthropies

Richard and Mary Elizabeth Barth

Kenneth Head

Ernest Pusateri

Jack Kent Cooke Foundation

John and Marcia Bishop

$1,000,000 to $4,999,999 Broad Foundation

Michael & Susan Dell Foundation

Bill and Melinda Gates Foundation

Robertson Foundation

Madigan Brown

Leslie and Walter Burlock Foundation

Matthew Hout

George Schneiderman

Montgomery Kersten and Sheryl Heckmann

Y.M. Carroll

Kinder Foundation

Thomas and Susan Dunn

William Clark

David and Amy Kopp

Marcus Foundation

William Critzman

Charlotte Lewis

Janet Hayes Davis Foundation

Bari Lipp Foundation

The Curtis L. Carlson Family

Peter Feeney

MGM Mirage Voice Foundation

Hellman Family Foundation

Lima-Fieler

New Profit, Inc.

$25,000 to $99,999 Foundation

Robin Hood Foundation

Select Equity Group Foundation State Farm Companies Foundation

The Stuart Foundation

Arthur Rock and Toni Rembe Rock

Maurice Karmen

$100,000 to $999,999

Reed Hastings and Patty Quillin

John and Jean Roberts Shoshana Rosenbaum

Lou Burnett

The City Bridge Foundation

Robbins Brothers

Jason Jennings

The Walton Family Foundation

Carrie Busch

Bill and Liebe Patterson

Edwin and Penelope Kilburn

The Annie E. Casey Foundation

Steve Kirby

Mark and Patricia Costello

Diane Leslie

Kenneth Daniszewski

Alex Lillen

Robert and Dana Emery

Schuyler Livingston

Sean Fieler and Ana Cecilia

Jean McMahon

Joel and Jeri Finard

Susan Marshall-Gordon

Robert and Elizabeth Fisher

Norman Foundation

Leonard Ford

Robert Olsen

The San Francisco Foundation Carlos Schonfeld Pramit Sheth

George Smith

Amelia Soudan

Sankaran Srinivas Staples

Steel House Sarah Stein

Elizabeth Stroud Kerim Taner

Richard Tarlowe Ralph Tate

Arun and Ellen Trikha

Jonathan Marr

Bruce Tuckman and

John and Laura Fisher

Heather McPhee

Lynn Watch

William and Sako Fisher

Susan O’Leary

David and Mieka Wick

Foster and Lynn Friess

Brian Osias 14

Katherine Edersheim

Nicole Wheeler Tom Wick

Hollis Wood


KIPP’s fifth grade class of 2005-2006 achieved the largest academic gains made by KIPP students since 1995.


While most KIPP students enter fifth grade at the second or third grade level in reading and mathematics,

the average KIPP student finishes the first year performing nearly on grade level in reading and language and performing well above grade level in mathematics. By the end of sixth grade, the average KIPP student performs above grade level in all subjects. KIPP Foundation Board of Directors: Donald Fisher, Chairman

Founder and Chairman Emeritus, Gap, Inc.

Reed Hastings Founder and CEO, Netflix, Inc.

Richard Barth, President CEO, KIPP Foundation

Shawn M. Hurwitz President and CEO, MAXXAM Property Company

Mike Feinberg KIPP Co-founder and Superintendent, KIPP Houston

Dave Levin KIPP Co-founder and Superintendent, KIPP New York

Doris Fisher Founder, Gap, Inc.

Michael L. Lomax President and CEO, United Negro College Fund

John Fisher President, Pisces, Inc.

Tracy McDaniel Founder and Principal, KIPP Reach College Preparatory

Scott Hamilton KIPP Co-founder and Senior Research Fellow, Thomas B. Fordham Institute

Mark Nunnelly Managing Director, Bain Capital

Our Vision: All schools will help children develop the knowledge, skills, character, and habits necessary to achieve their dreams while making the world a better place.

Our Mission: The mission of the KIPP Foundation is to create a respected, influential, and national network of public schools that are successful in helping students from educationally under-served communities develop the knowledge, skills, and character needed to succeed in college and the competitive world beyond.


Quick

Facts

: KIPP schools are tuition-free, open-enrollment public schools committed

to helping under-served students develop the knowledge, skills, and

character required to succeed in leading high schools and colleges,

as well as the competitive world after college.

: KIPP schools share a core set of operating principles known as the Five

Pillars: High Expectations, Choice & Commitment, More Time, Power to Lead, and Focus on Results.

: Admission to KIPP schools is granted to students regardless of prior

academic record, conduct, or socioeconomic background.

: Over 90 percent of KIPP students are African American or Latino/Hispanic.

Over 80 percent are eligible for the federally reduced meal program.

: A typical KIPP school day begins at 7:30 a.m. and ends at 5:00 p.m.

Students are also expected to attend school for four hours every other

Saturday and for three weeks during the summer.

: The KIPP Foundation recruits, trains, and provides support to outstanding

teachers seeking to establish free, open-enrollment college-preparatory public schools in America’s most under-resourced communities. Each school receives ongoing academic, legal, and financial support from the KIPP Foundation.

: The KIPP network comprises 52 schools, 48 of which are middle schools

serving students in grades five through eight. The network

also includes two high schools and two elementary schools.

: Each new KIPP school opens with a class of only one grade level. Each

year thereafter, an additional grade level is added to the student body

until the school is serving all grades that comprise an elementary, middle,

or high school.

For more information about KIPP, please visit www.kipp.org.


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