2008 - 2009 Report to Investors

100 East 10th Street, Suite 500 Chattanooga, TN 37402www.pefchattanooga.org

2009 Highlights

We’ve merged with the College Access Center. Thanks to Hamilton County schools, the Community Foundation of Greater Chattanooga and many local donors, we now support college advisors in every Hamilton County high school and in four middle schools; a mentoring program that allows college students to help pave the way for high school partners; Camp College, a summer program for aspiring first-generation college enrollees; and Passport Scholars, which offers a powerful summer enrichment program to low-income girls. Our new website adds an excellent Student Center with lots of guidance about enrolling in college – check it out at www.pefchattanooga.org!

Work continues on major initiatives: 2009 was a tough year for test scores, but overall trends are still moving in a positive direction.

The percentage of Benwood 5th graders passing the state TCAP exam rose from 91% in language arts and 89% in math in 2007 to 92% in both subjects in 2009.

The percentage of middle school students scoring Advanced in math increased from 30% in 2005 to 42% in 2009, and in language arts from 30% to 40%. 8th grade student EXPLORE results (a precursor to the ACT exam) beat the national average by significant margins in every subject.

The percentage of high school students passing the Algebra I Gateway increased from 55% in 2003 to 76% in 2009, and the percentage of students scoring Advanced on the English II Gateway jumped from 50% in 2003 to 72% in 2009.

We graduated our 10th class of Leadership Fellows and welcomed the 11th. Currently, 41 principals, 45 assistant principals, and 59 teacher leaders are graduates of Leadership Fellows.

Excellent Teachers are everywhere. We launched a year-long campaign featuring 20 Excellent Teachers from Hamilton County schools, including video podcasts and monthly columns in Chattanooga Parent magazine. Take a peek at www.pefchattanooga.org/ExcellentTeachers.

The Public Education Foundation, in partnership with Hamilton County schools, the Chattanooga Area Chamber of Commerce and UT Chattanooga, has begun work to develop a Principal Leadership Academy. This academy will play an important role in preparing assistant principals to take over the challenges of running a school – including both the business and educational aspects of the job. It will provide training in leadership and decision-making; best practices to improve instruction; the effective use of data; personnel management and other relevant topics.

TEACH/Here, a teacher residency program, is the second innovative major initiative that will begin this year. PEF has formed a unique partnership with HCDE, Knox County Schools and UT Knoxville. This initiative will increase the number of highly qualified Hamilton and Knox County math and science teachers by recruiting from the ranks of recent college graduates and business people who have strong skills in those subjects. Residents will earn both a teaching certificate and a master’s degree during a one-year program in which they serve alongside a master teacher in a classroom 4 days per week, while attending class themselves on the 5th day and during the summers. Visit the new website at www.TeachHere.org

Officers & Executive Committee

Jim HillBoard Chair

John F. GermBoard Vice Chair

Roger DicksonBoard Secretary

H. Grant Law, Jr.Board Treasurer

Ruth S. HolmbergImmediate Past Chair

Dr. Jane W. Harbaugh

Ellen Hays

Board Members

Domina Coleman Alford

David Breckinridge

Kitty Caldwell

Mary Jo Clark

Michael Cranford

Tom Kinser

Candy Kruesi

Robert H. Siskin

Exciting New Projects

For more information contact:

Dan ChallenerPresident423-265-9403dan@pefchattanooga.org

Christa PayneDirector of Development423-648-4449cpayne@pefchattanooga.org

Annual Support Anonymous (14) Lee and Iris Abelson Philip A. Acord Bill and Ann Aiken Jeannine Alday Ashley Aldridge Mona Allday in honor of Ruth S. HolmbergCorinne A. Allen in honor of the PEF Board and StaffRoxanne Anthony Mr. and Mrs. T. Maxfield Bahner Stephen L. Ball Sandra Barnwell Mark and Penny Bean Rowena Lee Belcher Monique Berke Claire S. BinderJoy BlackVernon and Sandra BlankenshipTena BoehmLee BolesDavid and Tracy BreckinridgeFletcher BrightDavid and Judy BritainFrank A. BrockMr. and Mrs. Charlie BrockMr. and Mrs. Frank Kruesi BrockPaul, SuSu and Casey BrockRegina BrockPaula and Grady BurgnerHacker and Kitty CaldwellMr. Robert H. Caldwell Tom Caldwell Mr. L. Hardwick Caldwell, Jr. Fred and Nanette Carr Lakesha Carson Doreen “Callie” Casey Jim and Rhonda Catanzaro The Dan Challener Family Chandra and Chitra Chandrasekaran Mary Jo Clark Griffith X. Clarke in memory of Barbara McKenzieHerb and Sue Cohn Michele H. Collins Kathleen Conner Linda and Pete Cooper Robin Copp Senator and Mrs. Robert P. Corker Michael Cranford Tina and Sam CurrinCustom Custodial, Inc. Joseph H. Davenport Gary and Anne Davis John and Virginia Davis Karen Day Mr. Joseph F. Decosimo in honor of Christa PayneRose Decosimo

Cindy Dees Sally and Arthur Dickerson Roger and Pam Dickson Marsha Jackson Drake Tom Dubose Mary Duffy Mr. and Mrs. Larry Duncan James and Brenda Eason Wally and Shannon Edmondson David Eichenthal and Bea Lurie Ray Evans Mrs. Norma Faerber Mrs. and Mrs. Thomas W. Faulkner Anetta Ferguson John Foy John and Judy GermGoodSearch Brad Goodson Saunya Goss Paula Gossett Elizabeth Graham in honor of Fletcher BrightPhilip and Leslie Graitcer Eddie and Katrina Gravitte Ursula Greene Dr. and Mrs. Mike Greer Tom and Marion Griscom Frances Haman-Prewitt Hamilton County Principals Association in memory of Sandra Jerardi’s motherJane Harbaugh Elaine Harper Mr. Shane Harwood and Family Ellen M. Hays Judy A. Heacker Jim and Elaine Hill Susan Hixson Christine Hockert Ruth S. Holmberg The Rev’d. Hunter and Prestine HuckabayLisa Huskey Phil and Audra Iannarone Deanne and Nelson Irvine Billie L. Jenno Sandra Jerardi Inga Johannesen Mr. and Mrs. S.K. Johnston, Jr. Mrs. Robert C. Jones, III (Peggy) in honor of Alice & Jack LuptonWendy A. Jung George and Ismahen Kangles Jamelie Kangles Bill and Susan Kennedy Tom Kinser Riki and David Kissick Kristin Knight Carrie and Gary Kuehn Mary-Margaret LaneCarol W. LangstonM.J. and Howard LevineLu LewisLori Link

Cindy Dees Sally and Arthur Dickerson Roger and Pam Dickson Marsha Jackson Drake Tom Dubose Mary Duffy Mr. and Mrs. Larry Duncan James and Brenda Eason Wally and Shannon Edmondson David Eichenthal and Bea Lurie Ray Evans Mrs. Norma Faerber Mrs. and Mrs. Thomas W. Faulkner Anetta Ferguson John Foy John and Judy GermGoodSearch Brad Goodson Saunya Goss Paula Gossett Elizabeth Graham in honor of Fletcher BrightPhilip and Leslie Graitcer Eddie and Katrina Gravitte Ursula Greene Dr. and Mrs. Mike Greer Tom and Marion Griscom Frances Haman-Prewitt Hamilton County Principals Association in memory of Sandra Jerardi’s motherJane Harbaugh Elaine Harper Mr. Shane Harwood and Family Ellen M. Hays Judy A. Heacker Jim and Elaine Hill Susan Hixson Christine Hockert Ruth S. Holmberg The Rev’d. Hunter and Prestine HuckabayLisa Huskey Phil and Audra Iannarone Deanne and Nelson Irvine Billie L. Jenno Sandra Jerardi Inga Johannesen Mr. and Mrs. S.K. Johnston, Jr. Mrs. Robert C. Jones, III (Peggy) in honor of Alice & Jack LuptonWendy A. Jung George and Ismahen Kangles Jamelie Kangles Bill and Susan Kennedy Tom Kinser Riki and David Kissick Kristin Knight Carrie and Gary Kuehn Mary-Margaret LaneCarol W. LangstonM.J. and Howard LevineLu LewisLori Link

Cartter LuptonJoni MartinJohn Maynard and Rhea ThurmanAllison McAvoyAllen and Alice McCallieMr. and Mrs. Spencer McCallie, IIIBrad McCormickLee and Connie McDadeToni and Jack McGauleyJeanie and Mike McKennaDebbie McMahanLee Ann Mills Sharon Mills Mr. and Mrs. Olan Mills, II Cannon and Rick Montague Mr. and Mrs. Carrington Montague Patrick and Robbie Moore in honor of Shannon & Wally EdmondsonThe Reverend Mary N. Moore Gail Morgan OJ and Anne Barron Morgan Jack Murrah AnnaLouise H. Myers Paul Neely Maury and Jennifer Nicely Dr. and Mrs. N.R. Nichols, III Bill and Kathy Noseworthy Ruth and Fred Obear Neelie ParkerChrista and Bill PayneFaye PharrJohn and Mufti PhillipsLucile S. PhillipsJack and Sherry PollockMerv and Helen PregulmanScott L. Probasco, Jr.Allison RobertsSteven and Cindy RobinsonAmy M. RogersRick and Suzanne RushworthClara Sale-DavisHenry and Rachel SchulsonLisa and Gregg ShanderRobert and Leslie SharpeUneva and Charles ShawRobert and Pris SiskinGeorge and Leigh SkonbergAlice L. SmithGarnett A. SmithHelen and Stanley SmithMargaret and Stephen SmithDr. Joanie SompayracJennifer SpatesJim and Marian SteffnerChristian StegallJohn StewartJudith F. StoneSusan StreetRobert J. Sudderth, Jr.Elaine SwaffordSusan G. SwansonRay Swoffard

Otto Taylor, Jr.Marie ThatcherJudge W. Neil and Anne A. ThomasHerbert A. ThornburyTom and Nancy TolarJean TrohanisEdna VarnerDebra VaughanCharlotte and John VlasisMike and Amy WaldenPatsi and Kirk WalkerSamantha WalterH. Robert Walter, IIIBill WarrenSharon S. WattsHarvey WeissSue Anne WellsRuth G. WhiteDr. Marilyn Willis Pam WomackRodney and Carol WoodsAnn and John WoodyAndrea Ziegler

Foundations Annenberg FoundationBenwood FoundationCommunity Foundation of Greater ChattanoogaGordon Street FoundationLumina Foundation for EducationLyndhurst FoundationMcKenzie Charitable FoundationNEA Foundation Sulzberger Foundation Tucker Foundation

Leadership Book ClubsAnonymous

Leadership InitiativeFirst Tennessee Foundation Ann Kilcher

Principal Leadership AcademyAnonymousBlueCross BlueShield of Tennessee Health Foundation Electric Motor Sales & Supply, Inc. Joseph H. DavenportUnum

TEACH/HereTVA

Revenue received for 2008-2009 operations: Grants Annenberg Foundation $500,000.00 Benwood Foundation 1,877,100.00 Community Foundation of Greater Chattanooga 100,200.00 Lumina Foundation for Education 35,000.00 Lyndhurst Foundation 1,500,000.00 Lyndhurst Foundation (Princeton Review) 125,092.00 NEA Foundation 515,000.00 Tennessee Higher Education Commission 37,790.00 Subtotal 4,690,182.00 Contributions 227,953.00 Other Support Appropriation of Endowment Assets for Operations 583,126.00 Funds Available from Prior Year* 283,143.00 TOTAL REVENUE AND SUPPORT $5,784,404.00 Expenses: Benwood Initiative $1,774,598.00 High Schools for a New Society 526,030.00 Middle Schools for a New Society 1,887,081.00 College Access & Success 307,874.00 Leadership Initiative 334,761.00 Management & General Expenses 357,062.00 Communications & Development 281,836.00 Teacher Residency 123,463.00 Osborne Fellows Program 18,576.00 Various Other Programs 173,123.00

TOTAL EXPENSES $5,784,404.00 Long Term Endowment: Endowment Account Balance 7/1/08 $11,862,274.00 Transfer to Endowment Operating Account $(583,126.00) Net Earnings $(2,427,728.00) Endowment Account Balance 6/30/09 $8,851,420.00

Revenue received for 2008-2009 operations:

Grants Annenberg Foundation 500,000.00$ Benwood Foundaton 1,877,100.00$ Community Foundation of Greater Chattanooga 100,200.00$ Lumina Foundation for Education 35,000.00$ Lyndhurst Foundation 1,500,000.00$ Lyndhurst Foundation (Princeton Review) 125,092.00$ NEA Foundation 515,000.00$ Tennessee Higher Education Commission 37,790.00$ Subtotal 4,690,182.00$

Contributions 227,953.00$

Other Support Appropriation of Endowment Assets for Operations 583,126.00$ Funds available from Prior Year* 283,143.00$

TOTAL REVENUE AND SUPPORT 5,784,404.00$

Expenses:

Benwood Initiative 1,774,598.00$ High Schools for a New Society 526,030.00$ Middle Schools for a New Society 1,887,081.00$ College Access & Success 307,874.00$ Middle Schools for a New Society 1,887,081.00$ Leadership Initiative 334,761.00$ Benwood Initiative 1,774,598.00$ Management & General Expenses 357,062.00$ Management & General Expenses 357,062.00$ Communications & Development 281,836.00$ Leadership Initiative 334,761.00$ Teacher Residency 123,463.00$ College Access & Success 307,874.00$ Osborne Fellows Program 18,576.00$ Communications & Development 281,836.00$ Various Other Programs 173,123.00$ Teacher Residency 123,463.00$

Various Other Programs 173,123.00$ TOTAL EXPENSES 5,784,404.00$ Osborne Fellows Program 18,576.00$

High Schools for a New Society 526,030.00$ Long Term Endowment: Endowment Account Balance 7/1/08 11,862,274.00$ Transfer to Endowment Operating Account (583,126.00)$ Net Earnings (2,427,728.00)$ Endowment Account Balance 6/30/09 8,851,420.00$

Audited Financial Statements Prepared by Barto, Hoss & Company, P.C.*Earnings from the Operating Account, carried over grant money

FINANCIAL SUMMARYJuly 1, 2008 to June 30, 2009

Middle  Schools  for  a  New  Society  

33%  

Benwood  Ini8a8ve  31%  

 Management  &  General  Expenses  

6%  

Leadership  Ini8a8ve  6%  

College  Access  &  Success  

5%  

Communica8ons  &  Development  

5%  

Teacher  Residency  2%  

Various  Other  Programs  3%  

Osborne    Fellows  Program  

1%  

High  Schools  for  a  New  Society  

9%  

Audited Financial Statements prepared by Barto, Hoss & Company, P.C. *Earnings from the Operating Account, carried over grant money

Financials