The role of Chicago foundations in school reform from 1987 to 1990 is examined in this paper, with a focus on the paradoxical relationship between the city's philanthropic community and the Chicago Reform Act of 1988. Data were derived from three surveys conducted since 1987 on the levels and targets of educational grantmaking by Chicago foundations; a summary of grantmaking by 10 Chicago foundations during 1987-90; and personal notes of foundations' interests and allocations of staff time. Following an explanation of the paper's personal and analytical qualifiers, the second section highlights recent commentary on the reform act's historical significance. The third section summarizes donors' grantmaking and nongrantmaking activities before and after the act's passage. A finding is that community foundations were not involved with the act's development and passage, but with implementation. The last section presents lessons that point to: (1) the convergence of forces that brought school reform; (2) the need for diverse policy advocates; (3) the theoretical dilemma posed by decentralization: and (4) the consequences of public policy as a change lever. Two figures and three graphs are included. Appendices include a history of the Reform Act and a list of Chicago grant recipients from 1987 to 1990. (28 references) (LMI)