Los Angeles
Eli Broad strives to elevate the heart of the City of the Angels to truly grand heights.

For four decades, Eli Broad, founder and former chairman of KB Home and SunAmerica, has been one of those Los Angeles transplants who laments his adopted city’s lack of a true core and soul—a downtown where artists, office workers, shoppers, diners and residents gravitate at all hours. Six years ago, Broad decided to stop hoping for city plans that never materialized and put his own money into motion. He invited his friend Richard Riordan, the city’s mayor at the time, and a group of county supervisors to his home to talk about finally transforming the downtown area along Grand Avenue.

‘‘I envision it as a place where people from all parts of the community will feel comfortable being with each other.’’

That kind of transformation has been a dream ever since Dorothy Buffum Chandler, by doggedly raising funds and cajoling the city’s leaders, brought the Music Center into being in the 1960s. In the ensuing years, downtown L.A. added museums and performance spaces, but lacked the kind of urban élan Broad finds in what he calls the three other great cities—New York, London and Paris.

"I saw all this city land and county land, and no one was doing anything," Broad says. "And if we left it up to the city officials, I’m not sure what would have happened other than piecemeal, unplanned development."

Grand Avenue cuts through the Bunker Hill area, the city’s core where City Hall, U.S. District Court and the Civic Center stand within blocks of each other. The neighborhood has come a long way from its seedier period in the 1950s, when once-grand Victorian homes stood in disrepair. Broad has been one of many to support cultural growth in this area. He chaired the capital campaign to build the Walt Disney Concert Hall, which opened in 2003, and contributed $18 million of his own money. Still, as he saw it, the area needed more attractions, along with housing and retail to create the kind of mixed-use development urban planners prize.

So Broad gathered area officials and constituent groups, including representatives from the Music Center and the Catholic Archdiocese, and formed the Grand Avenue Committee, which he funded with $200,000. The group became the starting place to build support among politicians and community activists. The first challenge was to get the county and city to cooperate and create a joint-powers authority to oversee the project.

"It’s a known fact that the city and county do not get along," Broad says. In multiple lunches and meetings, facilitated in part through the committee, Broad convinced three mayors and numerous county supervisors and city council members of the plan’s merit. While they initially showed reluctance, Broad says that he believes the politicians were willing to consider his ideas because he had local credibility.

"I’ve been in this city now for 40 years—they know that I don’t hound them for commercial purposes. They know I have a history of doing good, so to speak, whether it’s in education or the arts," Broad says. "They know I’m generous, they know I’ve helped them to modest degrees during their political campaigns, so I have access, and they’ll listen."

Still, at times the project seemed on the verge of collapse. At one point, county and city politicians argued over who would approve it. Broad stepped in to broker a deal that called for simultaneous votes. On February 13, the county board of supervisors and the city council officially approved the project, granting a 99-year lease to the development firm Related Companies. In early March, Broad stepped down as chairman of the Grand Avenue Committee to focus on other projects.

When completed (construction will take place in three phases over an estimated four years), the $2 billion Grand Avenue project will include 400,000 square feet of retail shops, 2,600 housing units, a five-star Mandarin Oriental Hotel and a park. Five hundred of the housing units will be set aside for moderate-income residents. Related Companies, headed by New York housing magnate and philanthropist Stephen M. Ross, will bear the financial cost of the construction. Broad’s personal contributions have primarily been organizational. He is considering, however, contributing to the park, and hopes that others will follow.

Broad is pleased that the endeavor is backed by 21 civic groups. "We’ve never seen such community support for a project," he says. Along the way, however, critics have attacked both the plan and Broad. Some groups questioned whether the development would benefit only the wealthy. Others pointed out an irony that Broad profited from building moderately priced houses throughout the West, contributing to urban flight, yet the Grand Avenue project celebrates the opposite: civic renewal.

Broad says he ignores such disparagement. "I was very proud of the fact that we created KB Home and built hundreds of thousands of homes where people wanted to buy them—which was not downtown."

Today, visiting the area, it is apparent how much the existing attractions want for context. The park and greens will connect landmark buildings with an aim of weaving together commercial and residential uses.

The February 14 front page of the Los Angeles Times announcing the nearly unanimous votes featured a large photo of Broad and councilman Bill Rosendahl celebrating six years of hard work building a coalition, under a banner headline: "Grand Avenue Project Passes Go."

"I envision it as a place where people from all parts of the community—whether west side, east side, south side, the Valley—will feel comfortable being with each other, which is what we need," Broad says.

Cary, N.C.
Ann Goodnight and her husband, Jim, confront issues in the Research Triangle.

Ann Goodnight and her husband, Jim, both graduates of North Carolina State University, were college sweethearts in the 1960s when the state’s Research Triangle was beginning to show promise. Ann studied political science, while Jim eyed a future in technology. He received a bachelor of science degree in applied mathematics in 1965 and joined NASA’s Apollo program for a year before returning home to earn his doctorate. In 1976, he launched a software company, SAS Institute, in an era when tech behemoths—including Cisco Systems, IBM and Nortel Networks—were moving into the area.

(Photograph by David Sciabarasi.)

"We really owe our state," Ann says. She is fully aware that as Jim and she benefited from the technology boom and an influx of affluent new residents, North Carolina was simultaneously experiencing economic upheaval—losing its traditional furniture, textile and tobacco industries and seeing nearly 13 percent of its residents slip below the poverty line, according to state government statistics. The Goodnights, whose net worth is estimated at $4.1 billion to $4.5 billion, according to Forbes’ latest tally, are uncontested as the richest people in the state.

Their home and SAS headquarters are both located in Cary, the Raleigh suburb known for having more PhDs per capita than any American city with a population of at least 75,000. In recent years, the name Cary has inspired a local joke; it’s an acronym for Containment Area for Relocated Yankees.

‘‘We really owe our state.’’

Ann is quick to point out that in the Research Triangle and to the area to its north, schools, hospitals and other infrastructure have not quite caught up with the ongoing population boom. For their part, the Goodnights have contributed time and money aimed at upgrading the public schools. They have become alarmed by statistics showing that 37 percent of North Carolina high school students drop out before graduation. This school year saw an influx of nearly 8,000 new students in the Wake County public school system. Because Ann had spoken out for increased school funding in the past and had founded a high-tech private school, Cary Academy, she was not surprised when she received a call last year before the start of the fall semester from the county commissioner. He asked her to help sponsor a school construction bond proposal that would fund 17 new schools, along with renovations and repairs for 113 others. As cochair of Friends of Wake County, a group formed to push for the measure, Ann helped lead a successful effort to pass the $970 million plan—supported by 53 percent of voters last November. Jim backed the proposal as well, emailing 4,000 SAS employees urging them to vote yes.

Controversy dogged the campaign, as residents worried over what the measure might mean for their tax bills. On Election Day, a reporter asked Ann about poll results showing a significant number of voters opposed to the initiative. She admitted that she was frustrated that people "don’t get it"—an off-the-cuff response she now regrets. One of the opponent groups accused the Goodnights of having a vested interest in the proposal because, as Cary landowners, they stood to benefit from regional growth. These criticisms do not seem to faze Ann. "Their argument was so far-fetched; it didn’t hold water, it didn’t add up, it wasn’t consistent," she says. "They were just panicking—throwing anything they could into the mix to keep voters confused and doubtful."

In February, local residents learned that a company backed by Jim plans to sell 108 acres to the school board at a 168 percent profit. Jim, who had no knowledge of the deal, according to his business associates, has since told his representatives to return any of his profit to taxpayers.

Four years ago, the Goodnights began crusading for infrastructure of a different nature when they decided that Wake County needed a four-star hotel for its steady stream of visitors. They reasoned that such a hotel would also enhance the city’s social and cultural life while creating new jobs. Though they had no experience in the industry, they called senior executives at the Four Seasons and Ritz-Carlton with their proposal. Jim pointed out that many companies were expanding in the area. The rebuff they received came as something of a shock. "I remember the Four Seasons head guy told me, ‘You know, if we got a hotel down there and assigned our managers to it, they would think they had been demoted,’" Ann says.

Rather than scrap the plan, the Goodnights chose to build the hotel themselves. They used the Four Seasons in San Francisco as a model and set aside land on the SAS campus. First they picked a site that abutted a residential area, but the adjacent community was no less opposed than the hotel chains had been. So they moved their hotel a mile away, to a spot that Ann says she now likes better. In January, they opened the 150-room Umstead Hotel. No one is yet willing to predict the plan’s commercial success or whether the Goodnights’ estimation of their area’s demand for a four-star hotel and spa is accurate—let alone their promises of local economic growth.

Ann’s latest philanthropic and educational effort is an outreach program at the North Carolina Museum of Art, also in Cary, of which she is a board member. The Goodnights had previously contributed $1 million to create a park next to the museum where an abandoned juvenile detention center stood. Now she plans to bring schoolchildren to enjoy the facilities and learn about art. Because of the core-subject demands of end-of-grade testing and No Child Left Behind, classes such as art have suffered, Ann says, who wants the education program at the museum to be a national model.

Ann has also been busily denying recent rumors that her ambitions for Cary extend to running for mayor. "That makes the hair on my arms stand up," she has said. "There is absolutely no truth in this world that I would do that."

Jackson, Miss.
Jim Barksdale hopes to rescue his state’s economy by salvaging its moribund public schools.

Like the Goodnights, Jim Barksdale believes that he must save the schools before he can save the local economy. That is why the former Netscape Communications president and CEO—who oversaw the company’s $4.2 billion sale to AOL in 1998 during a war with Microsoft for Internet browser dominance—now spends most of his time traversing his home state of Mississippi to visit its notoriously underfunded public schools, which routinely place at or near the bottom of national rankings for math and reading scores. "I sit in the back of the room and watch and listen and try to give some help to the team," Barksdale says. "But I’m not an expert, and I don’t want to appear to be one or begin to think I am one."

(Photograph by Greg Campbell.)

Barksdale, who grew up in Jackson, is a product of the Mississippi school system, but he was one of the lucky students who came from middle-class parents who instilled in him an early love of reading. He has now adopted this mission: to improve literacy for children with the poorest reading skills. "It’s my firm belief that if you really want to break the cycle of poverty, the best way—the most productive way—is to improve reading scores," he says.

Barksdale graduated from the University of Mississippi, which is where he met his first wife, Sally; they married when they were both 21. He then left the state to pursue the business career that made him his fortune. He was an executive with Federal Express in Memphis and then with McCaw Cellular Communications in Seattle. In 1996, when the couple’s three children were away at college, Barksdale took a chance with a technology startup called Netscape, and he and Sally moved to Palo Alto, Calif.

‘‘It’s my firm belief that if you really want to break the cycle of poverty, the best way is to improve reading scores.’’

While at Netscape, Barksdale began to develop his literacy mission. He was serving as cochair of TechNet, a network of technology company executives concerned that their industry faced a shortage of qualified workers because of an inadequate public school system. Discussions among the executives spurred him to thoughts of his home state, its depressing education statistics and the problems that in-state colleges faced retaining Mississippi’s best students. The Barksdales went into action, making a $5.4 million donation to Ole Miss to develop an honors college.

But Barksdale knew the state’s educational problems started long before students reached college, and, in 2000, he partnered with the state department of education to create a literacy program that he would fund. The Barksdale Reading Institute began with $100 million, which to date has paid for teaching materials and more than 6,000 books for the lowest performing public schools in the state. Barksdale talked his younger brother, Claiborne, into moving back to Mississippi from Atlanta, where he was working as assistant general counsel for Bell South. Claiborne had been a teacher before he became a lawyer, so Barksdale thought he would be perfect as the institute’s CEO.

Initially, the institute focused on reading programs for kindergarten through third grade. Today, it employs 50 individuals—many of them teachers—who fan out across the state to work in schools and create individualized reading programs. The institute trains educators in local schools and provides master-level Barksdale literacy teachers in 12 schools. The institute also offers intervention specialists who help identify at-risk children reading below grade level and then test the students over a three-year period to measure improvements. "We all assume that because we can read, it would be pretty easy to teach somebody else," Barksdale says. "These children we are working with come from a lot of very difficult home lives, so one of the lessons is: It’s very hard."

Barksdale has faced challenges along the way. Sally, active in the reading program, died of colon cancer in 2003. Two years ago, Barksdale, who has since remarried, examined the results of tests that reading specialists had given "his" pupils, only to find that students were not moving up to their grade level in reading quickly enough. So he expanded the program to reach children before they entered kindergarten. "We wanted to start working with 3- and 4-year-olds because, quite often, these children never see a book or a magazine, and they’re never read to," Barksdale says.

He has become an agitator, urging politicians and bureaucrats to improve education funding. In 2005, Barksdale issued a challenge to state lawmakers after reading in a newspaper that the state was unlikely to pass a fully funded education budget. He offered a $50 million carrot in the form of scholarships for Mississippi students. That year, lawmakers approved a $2.2 billion elementary and secondary school budget—$87.7 million shy of the department of education’s request. The state failed to find additional funding, and Barksdale did not provide the scholarships.

But by February of this year, Barksdale hoped that a renewed $50 million challenge would be successful in the next legislative round. He remains enthusiastic about bringing all Mississippi students up to grade level in the future, despite the vast challenges. "We’re not afraid of being disappointed. We have to face facts that it’s an enormous undertaking, and no one’s really pulled it off yet in school districts around the country," Barksdale says. "I look at it in a little talk that I gave to our teachers after one year where we didn’t get quite as far as we wanted. Look, it’s like when they asked Edison, ‘You’ve been through 900 filaments that don’t produce light, are you disappointed?’ He said, ‘No, I know 900 things that don’t work—that don’t produce light.’ That’s sort of our motto."

Chicago
Richard Driehaus reinvigorates the Second City one neighborhood at a time.

Richard Driehaus was a middle-class kid growing up in the 1950s on Chicago’s South Side when his father commissioned an architect to design a home for a small plot of land he owned nearby. "I remember how exciting it was to look at the plans and imagine what it would be like," Driehaus says.

(Photograph by Richard Cahan.)

The blueprints weren’t extravagant. But his father, a The blueprints weren’t extravagant. But his father, a mechanical engineer who earned $10,700 a year, never could scrape together enough money to build the home. The experience helped form the man Driehaus would become: one aware of the potential beauty of urban environments—and one determined to earn enough to keep his dreams from being deferred.

Driehaus has succeeded on both counts. The investment business he founded in 1982, Driehaus Capital Management, has some $3.7 billion under management; he also runs Driehaus Securities, a company started in 1979. In the mid-1980s, he created the Richard H. Driehaus Foundation with seed capital of $3.7 million. Today, the foundation holds nearly $70 million and has given away close to $25 million; it distributes about $3 million a year. Two charitable lead trusts grant another $3 million each year. Most of his philanthropy targets the city he loves. "This is where I was born and raised," he says. "I can make an impact here, an impact I could never have in, say, New York."

Driehaus has thrown himself into the New Millennium Park project,
for example. Mayor Richard M. Daley conceived the idea to extend Grant Park, along Lake Michigan’s shore, and enlisted leading businesspeople to fund the project. The resulting 24.5 acres of parkland and cultural facilities opened in 2004 to rave reviews.

‘‘I can make an impact here, an impact I could never have in, say, New York.’’

To find a designer for the three-acre garden in the park, Driehaus sponsored a competition at a cost of about $250,000. He also gave $1 million for photography exhibits in the park.

Most of Driehaus’ giving, however, focuses on neighborhood-based initiatives where a relatively small amount of money can make a large impact. He has given a combined $2.5 million to his alma maters, along with dozens of smaller grants for economic development, such as his recent gift of $25,000 for the Center for Economic Progress to fund a program to help the working poor receive earned income tax credits. He also provided $1 million for the renovation of Old St. Patrick’s, one of Chicago’s oldest churches. "Richard wouldn’t say this, but he has become a major civic leader in the city, counted on by many," Sunny Fischer, executive director of his foundation, says.

The MacArthur Fund, impressed by the foundation’s arts efforts, gave $700,000 toward the cause, to be administered by the Driehaus Foundation. MacArthur executives appreciated his support of smaller arts and culture groups and theater and dance companies that often work in poor and underserved communities.

Much of Driehaus’ strategy relies on integrating business forces, government and public-interest groups. He remains frustrated that he sometimes fails to find a way to bridge the three occasionally contentious factions. His foundation created a contest to design two public schools for severely handicapped students, but the city has
yet to break ground because of budgetary and philosophical differences between city and state funders. Driehaus has enjoyed more success with designs for public housing. Planners are using elements of the foundation’s public housing design competition in a project underway in the Roosevelt Square area.

Driehaus finds the greatest satisfaction in his philanthropic work when all the city’s forces come together to surpass the power of its parts. "Millennium Park was a great success in that sense," he says. "It’s an example of how politicians can encourage growth and development in a way that puts the city back on the map." Noting that his contest brought forward a design that another donor implemented, and that the park itself inspired the development and renovation of many surrounding buildings, Driehaus says the Millennium Park project shows how the best efforts take on a life of their own. Harkening back to the thoughts of the 17th-century British architect Christopher Wren, he notes, "Architecture strives for the everlasting."