SON OF SCHOOL BUDGET DEFICIT

HOW WORRIED should we be about the latest school district deficit?

Last week, the School District of Philadelphia said it was looking at a budget deficit of $33 million.

Is this a replay of budget mess of last year, when, under then-Superintendent Paul Vallas, the School Reform Commission was surprised by a $73 million shortfall? The ensuing drama about that deficit undoubtedly hastened Vallas' departure from Philadelphia.

That was then. This one is different. The Vallas budget deficit was notable for its lack of clear insight into what had led to the gap, other than a failure of stricter oversight.

While this year's is different, it is troubling in a different way.

A big part of this year's deficit is due to an unanticipated increase in charter-school enrollments. Instead of the 1,400-student increase the district budgeted for, 3,000 new students signed up for charter schools. That impacts the budget because the district pays charters $7,700 for each student and $16,720 for each special-education student.

More than 30,000 students are enrolled in city charters; an additional 1,900 are enrolled in cyber charters - schools conducted via computer.

Meanwhile, because the school budget is a flat figure, not formulated on a per-student cost, the district still must pay its fixed costs, which don't necessarily decrease with every student moving into a charter school.

What's worrisome is that the district has no way of keeping closer tabs on charter enrollments until after the fact - when the budget is already established. Charter schools don't have to report on enrollments until they exceed their cap, which they rarely do. That removes predictability, one of the tools of managing a budget of any size, but especially one as huge as the district's $2 billion budget.

And cyber charter schools, which get slightly less per student than do other charters, are under less district oversight, since cyber charters are granted by the state Department of Education.

Champions of charter schools see the increase in enrollments as a sign that they're working. It's clear that parents - increasingly parents of private- and parochial-school students - like them.

The district and charters have been struggling recently over the issues of oversight and accountability. But if we expect the district to balance the costs of maintaining district schools and funding the rise in charters, all while keeping a balanced budget, maybe the two will have to find a way to work better together. *