The future of our city and region depend upon high quality schools that prepare every student for success in the workplace or college. Ensuring our schools receive the funds they need to prepare our students is the concern of every parent, school administrator, teacher, and employer in Philadelphia.
Last week, Pennsylvania passed a budget that includes a financial plan for the School District of Philadelphia that provides $140 million in additional government funds this year, and $150 million next year. Together with $133 million in projected savings from a new collective bargaining agreement to be negotiated with the Philadelphia Federation of Teachers, this package will generate almost $275 million in new revenues and savings for the School District, or more than 90 percent of the need projected by the Superintendent and the School Reform Commission. While the plan is not a perfect solution, and while all of us might not like every element of the package, the plan will help Philadelphia’s 200,000 students in our city schools right now.
Specifically, the package includes the following key elements:
In the first year:
• $45 Million in one-time state funds released to the District after the Federal government forgave part of a debt that the Commonwealth owed over old foster care payments;
• $15 Million in state funds through the basic education subsidy, a slight increase over the original amount proposed in the state budget;
•$30 Million in city funds through increased collections of delinquent city taxes; and
• $50 Million through a specially authorized loan against future tax revenues from a dedicated portion of an existing city sales tax.
In the second and following years (in order to ensure that this solution is sustainable):
• $120 Million in recurring city revenues to the District from the extension of a 1 percent city sales tax that had been set to expire next June; and
• $30 Million in city funds through increased collections of delinquent taxes.
When the state budget was first proposed by Governor Corbett this year, it contained $14 million in additional state funds for basic education for Philadelphia (above the existing state subsidy for city schools). In March, the School District and the School Reform Commission made public their budget needs: $60 million more in city funds, $120 million more in state funds, and $133 million in concessions from the Philadelphia Federation of Teachers.
The School District made this request because, despite executing numerous efficiencies that included closing more than 30 schools, halving the size of its administrative staff, reaching a ground-breaking labor agreement with its blue-collar work force, and a host of other cost-saving measures, it still faced a budget deficit of more than $300 million that threatened its very viability and ability to open schools this fall.
While the business community energetically supported the strong advocacy by the Mayor and Council President to tax cigarettes sold in Philadelphia to provide additional funding for city schools, unfortunately there was not majority support for the idea in the General Assembly this year. We still believe this idea has merit to create an added source of recurring revenues and to free up a