Budget blues from the SRC

Chief financial officer Michael Masch, seen in this file photo, told the School Reform Commission Wednesday that the district accepted about $258 million in federal stimulus funds a year that it knew would go away. (Ron Tarver, File / Staff Photographer)

It's a packed agenda at the Philadelphia School Reform Commission meeting today, where officials are hearing a a progress report on the state of the district's finances.

Here's the Cliff's Notes: not good.

Chief Financial Officer Michael Masch has braced us for the coming year's disaster of a budget, with its $629 million gap.  But today's presentation also focused on the current fiscal year's budget, 2010-11.  The biggest headline today is that the district will need to dip into its reserve to the tune of $25 million to balance the budget this year.  That's $25 million that won't be available to offset the $629 million gap for next year. As it relates to next year's budget, Masch said the district has taken hits from people who suggest it should have known about the coming fiscal crisis.  Yes, and no, he said.

The district accepted about $258 million in federal stimulus funds a year that it knew would go away, Masch said.  The awarding of those funds coincided with the SRC approving Dr. Arlene Ackerman's Imagine 2014 strategic plan.  The district spent stimulus money on new programs included in Imagine 2014 knowing that it would have to roll some of the spending back once the money went away.  "Nothing was put in place that couldn't be undone," Masch said.  "We really had no other choice."

That's the first time I've heard that said.  Let me repeat - the district put programs in place (Imagine 2014 programs) that it knew would have to be taken away.  The other part of the federal aid was state fiscal stabilization aid - that is, money given by the feds to states and then awarded to districts not to augment district programs but to replace money that normally would be awarded by state and local governments that was not available because of a down economy.  In other words - the hope was the economy would have been better by now, and states would be able to fill in the gaps themselves.  But the economy has not rebounded to the level legislators had hoped, so the district is out of luck.  It's not alone in this predicament, of course - districts around the region and around the country are facing similar dilemmas.  But for Philadelphia, this is the first year of bad times.  Others felt the crunch earlier.

More to come from the SRC.  There are lots of speakers on the budget, many about proposed cuts to art and music spending, and many about Renaissance charter agreements, which are to be approved later this month by the SRC.  (Today's meeting is a non-voting meeting.)

UPDATE, 5 p.m.: Audenried High sophomore Dyshanae Morris gives what is undoubtedly the loveliest testimony at today's SRC meeting.  She sings Sam Cooke's "A Change is Gonna Come" to demonstrate why art and music education, which could be on the chopping block in the coming budget crisis, are important.  Dyshanae got a standing ovation.  There were several speakers who pleaded with the SRC to not cut art and music.

Other speakers have talked about Renaissance charter schools, whose agreements are scheduled to be approved at the next meetings.  Some speakers spoke out against the planned conversion of Audenried High to a charter run by Universal Companies Inc.  One of them, student Onika Richardson, blasted the district for its decision to give Audenried to Universal.  She said the school's scores have gone up by 1000 percent since it re-opened three years ago.  She also questioned the district's decision to give away a practically brand-new building to a charter when it plans to close many old buildings. 

Some folks also spoke about King's planned conversation to a charter run by Foundations Inc.  Some people supported it, but others denounced it.  King has been particularly messy - its School Advisory Council voted to give the school to Mosaica, and the SRC voted to endorse that match.  Then the next day, Mosaica suddenly withdrew, and Foundations, which is supported by state Rep. Dwight Evans, was given the school.  It's been a really controversial process.

What do you all think of the Renaissance process?