Phila. schools prepare for cuts as they face budget shortfall

Philadelphia School District officials are preparing for a budget shortfall of at least $160 million - and the figure could easily grow, depending on what legislators decide in the coming days.

In the state budget agreement announced last week, basic education funding, the biggest chunk of money for schools, received a $300 million bump statewide over last year's spending plan. But that is still less than what Gov. Rendell proposed earlier this year - and what Philadelphia staked its $3.2 billion budget on.

What is certain is that as a result of revised basic education and state fiscal stabilization grant line items, Philadelphia is down by about $160 million. As lawmakers hammer out the details, that could grow by "$10, $20, $30 million more," Michael Masch, chief business officer, said yesterday.

Masch said that it was too early to speculate where cuts might be made, but that the district would "move heaven and earth" to keep in place reforms put forward by Superintendent Arlene Ackerman.

This school year, the district lowered class size in kindergarten through third grade and hired more counselors, particularly in the city's troubled neighborhood high schools.

Will the district commit to keeping those reforms in place, no matter what?

"I can't say that," Masch said. "We don't have a plan yet. But we're not going to turn away from making reform. I do not think that Dr. Ackerman will let us rest until we have figured out a way to do everything in our power to make the dollars we do have go as far as possible in helping us enable more students to succeed academically."

If implemented fully, Imagine 2014, Ackerman's five-year strategic plan, will cost the district $126 million this school year. Some costs are already sunk - the district upped its spending on summer school this year, for instance, and the School Reform Commission has already signed off on a number of contracts for this year.

One area where the district expects to realize savings is in alternative education. Earlier this month, officials informed several accelerated schools that serve dropouts or students at risk of dropping out that their contracts would be canceled or cut.

The district will still offer more than 1,000 new seats for accelerated schools this year, Masch said, but in this and other areas, they are "maybe not going to go as far as we had hoped."

In the spring, Masch prepared a document detailing the potential impact of $300 million in cuts being proposed by Senate Republicans. In that doomsday scenario, class sizes would be bumped back up; counselors would be cut; early-childhood slots would be cut; and some supports for struggling schools would also be axed.

Masch said that he was "not anticipating that there would be public hearings" on the cuts. The School Reform Commission's approval of the budget is a ceiling for spending, he said, and spending under that figure is allowed.

But, Masch said, "we expect to be fully accountable, first to the School Reform Commission, then to the public, so they understand exactly how we will revise the budget."

Don't expect quick answers, Masch said - the district has no final numbers from the state yet.

It is not the first time a budget crisis has cropped up in recent years. In 2006, chief executive Paul Vallas announced a "surprise" $73 million budget shortfall which resulted in central office layoffs, less money for busing, a cut to consulting contracts, and changes to classrooms.