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Drexel University and the Academy of Natural Sciences are at a standstill over the Academy’s future — and now it’s a question of who will blink first.

The more-than-monthlong stalemate appears to center on money, power, and control of the 214-year-old Academy.

“There are no talks scheduled,” said David L. Cohen, the former Comcast executive and U.S. ambassador to Canada who has been attempting to broker an agreement.

For the first time in weeks, pulling back the curtain on what have been confidential talks, Cohen and leaders of both Drexel and the Academy shared details of the negotiations and their perceptions of the sticking points.

Cohen said in an interview last week that talks broke off after the Academy said it wanted to pursue disaffiliation from Drexel but the two sides disagreed on terms.

The stalemate continues even as the university and the Academy announced Friday that they would accept a review funded by the William Penn Foundation and other foundations for wide-ranging feasibility studies on the physical and fiscal conditions of the Academy and a sustainable model for its future.

The negotiations on the governance and fiscal structure of the Academy, however, are separate from the review, Drexel president Antonio Merlo said in a Friday interview.

On Monday, City Council will begin the second part of a hearing investigating the shutdown of the Academy’s museum, with Merlo and Deputy Mayor Patricia Wellenbach — who were subpoenaed by Council — scheduled to testify. The museum closed to the public on Sept. 27, drawing outrage and protest by community activists and Academy proponents.

Cohen said Council’s steps have “interfered with” the negotiations between Drexel and the Academy. “The public vilification and witch hunt that we’re engaged in now is not constructive to coming up with a solution,” he said.

Councilmember Isaiah Thomas, who leads the committee running the hearing, declined to address Cohen’s comments. But he said he has been involved in a lot of positive conversations with people who want to step up and save the Academy. There are multiple donors willing to put up “tens of millions of dollars” once the Academy’s path is clear, he said.

“The biggest holdup now is Drexel and the Academy defining their relationship,” he said.

Donors, he said, do not want to commit until they know the status of the Academy and Drexel.

“If I’m a philanthropist and there’s not clarity on what you’re doing moving forward, why would I donate now? Am I donating to the Academy or am I donating to Drexel University? I’ll donate when I get clarity …”

A disputed ‘term sheet’

Less than a year ago, Gov. Josh Shapiro and Mayor Cherelle L. Parker asked Cohen to help with the negotiations between Drexel and the Academy. Drexel had wanted the Academy, which it felt had become a financial drain, to fully merge into the university or disaffiliate.

When talks lagged in July, Drexel threatened to cut off funding to the Academy, which would have “summarily put the Academy out of business,” according to Academy board chairperson Suzanne Biemiller.

Cohen said he had brokered a “term sheet” that both sides had signed off on in September. It would have allowed for the “survival and healthy existence” of the Academy, he said. When it came time to negotiate “definitive documentation to implement the terms,” the two sides traded “competing proposals,” which Cohen said he did not think were that much at odds.

But after he called a meeting in early October to discuss the proposals, the Academy had changed its position and said it no longer wanted to implement the terms but instead pursue disaffiliation from Drexel, Cohen said.

“They essentially reneged on the agreement that was reached in good faith,” Merlo said.

Biemiller disagreed with that characterization.

“We said that the term sheet did not work economically and that the trustees of the Academy would therefore not approve it,” she said. She added that Drexel’s initial rejection of an offer by the William Penn Foundation to fund operating expenses of the Academy to keep the museum open “signaled to the Academy trustees that Drexel wasn’t working in the best interest of the Academy.”

The Academy, Cohen said, believed it could generate enough support through philanthropy, “new partners,” and government funding to stand on its own.

He, the mayor, and the governor were all “skeptical” of that position. Biemiller countered that trustees have heard from a number of individuals and civic leaders who want to help the Academy.

(Shapiro’s spokesperson did not provide comment; neither did Parker’s.)

Disaffiliate or fully merge?

Cohen said he had been advising the parties against disaffiliation and toward a full merger. But Merlo, he said, agreed to honor the Academy’s request for disaffiliation. The university offered to provide in-kind services for three months after the date of disaffiliation, Merlo said.

The Academy, Cohen said, rejected that proposal and offered its own, which he characterized as “a bit … inflammatory.”

“It was not really a disaffiliation proposal because it did provide for significant additional financial support and in-kind support and continuation of educational and research support” from Drexel, Cohen said.

The Academy, Merlo said, wanted Drexel’s continued financial support for five years. Neither Cohen nor Merlo would say how much the Academy requested, though Cohen said it was “a lot.”

The financial support from Drexel eventually would have ceased, Cohen said, but some of the in-kind support would have continued in perpetuity.

The Academy’s proposal, he said, also called for the “immediate termination of all of the governance rights and financial controls and budgetary controls that Drexel has under the terms of the 2011 affiliation agreement.”

Cohen said he advised the Academy to modify its proposal and it declined. Drexel, Merlo said, rejected the Academy’s proposal and made a counteroffer.

“We haven’t heard back ever since,” Merlo said.

For him, disaffiliation meant that the Academy would go its separate way on a certain date and from that point on would be financially responsible for itself.

But Biemiller disagrees.

“Drexel’s proposal was an immediate disaffiliation with no Drexel funding,” she said. “An immediate cessation of funding would have essentially put the Academy out of business. Any separation from Drexel which saves the Academy as an institution must be gradual.”

She also objected to the characterization that the Academy’s proposal was inflammatory. Instead, she said, it was a “thoughtful, staged disaffiliation” that would have cost Drexel less than if it had moved forward with the terms for merger.

Who controls the Academy?

The 2011 affiliation agreement that joined Drexel and the Academy does not address any commitment to fund the Academy if the parties disaffiliate. Drexel therefore would not be required to do so, according to Laura Solomon, founder of Laura Solomon & Associates, a law firm that exclusively represents charitable and other tax-exempt organizations and philanthropists.

“The parties could negotiate a ‘divorce’ in which Drexel had some kind of financial commitment (e.g., alimony) to support the sustainability of the Academy — but that would seem to be a tough ask at a time when educational institutions are facing their own financial challenges,” she said in an email.

“While we understand the economic pressures that colleges and universities are facing today,” Biemiller said, “as a fiduciary board, it is our responsibility to work toward a solution that is in the best interests of the Academy and the people of Philadelphia and the scientists around the world who care about it.”

Drexel currently has a lot of authority over the Academy under the 2011 agreement, with the right to approve its budget, choose its CEO and senior staff, and appoint its board. The Academy board can make recommendations, but the authority ultimately belongs to Drexel.

The Academy is a nonprofit corporation with a single member — Drexel. The Academy retains authority over its endowment, but delegated management of it to Drexel.

But Drexel still was on the hook to cover the Academy’s deficits — as laid out in the affiliation agreement — noting it had provided $49 million in direct cash to the Academy over the last 15 years. A university representative told City Council last month that Drexel, which has been working to erase a deficit in its own budget, can no longer afford the $5 million to $6 million a year in support to the Academy.

Drexel, Merlo said, wanted the Academy to become a “wholly controlled subsidiary” of Drexel, which he said would have given the Drexel board more control over the Academy’s finances, yet maintained it as a separate nonprofit with its own assets and endowment.

That means there would only be one fiduciary board — Drexel’s.

It would have enabled Drexel’s board to deal with the Academy’s deficits, Merlo said.

“You cannot have a subsidiary which is part of this bigger company that runs a $5 million deficit a year in perpetuity,” he said. “The new structure would have allowed [Drexel] to do the type of interventions you need.”

But there were “guardrails” built in, Merlo said. Drexel, for example, would not have been able to dispose of assets of the Academy without a vote in favor by two-thirds of the Academy board.

A solution in New Haven?

Just how long Drexel and the Academy will remain at an impasse is unclear. Academy board members serve three-year terms, which means as the terms of some expire, Drexel could replace them with new, like-minded board members.

Merlo declined to comment on whether the university would take that step.

“I would not like to speculate into the future,” he said.

Cohen said he still thinks an agreement can be struck. Maybe it would take “some push from the governor and the mayor to get people back to the table,” he said.

Merlo said he is hopeful the foundation-funded review will lead to solutions, similar to what happened with Yale University’s Peabody Museum, a natural history museum in New Haven, Conn. A donor gave $160 million, which galvanized others to donate. The museum closed for four years for renovations and reopened in 2024 offering free admission, with its attendance boosted several times over.

On this, Merlo appears to be in complete agreement with a Save the Academy Coalition representative, who also mentioned the Peabody as a potential model for Philadelphia at the City Council hearing last month.

“If they could do it in New Haven,” Merlo said, “I bet we could do it in Philadelphia.”