Phila. SD deficit has grown to as much as $282m
Initially projected at $218 million, the deficit is now anywhere between $255 and $282 million.
Phila. SD deficit has grown to as much as $282m
Kristen Graham
Philadelphia School District officials gave an update Friday morning on the state of their finances, and it was more bad news.
Initially projected at $218 million, the deficit is now anywhere between $255 and $282 million.
City Council's decision to give the distict $54 million less than the $94 million it asked for is part of the reason for the new number. But there are other factors - $9 million more from city tax collections and a net $8 million change in state funds. And the district is also bracing for a revenue loss of up to $27 million by virtue of tax appeal losses.
Officials say they want to make up the money by collecting delinquent taxes, and say they are taking steps with the city to make that happen. Should that effort not yield enough new money, though, they say they will have to consider things like non-school cuts, reductions to salary and benefits (both unionized and non-unionized employees) and finally, school cuts - the last resort, they said.
The district was already planning on deficit financing its projected $218 million gap. School Reform Commissioner Feather Houstoun said that while the district has the authority to finance up to $300 million, it would not be wise to do so.
"If you use borrowing for this, it’s just another one-time revenue that you have to fill next year." Houstoun said. "The more we can limit the size of the deficit this year and the use of deficit financing for that, the better the sitation will be going forward into next year."
Chief Recovery Officer Thomas Knudsen said the shifting financial picture complicated the negotiations with 32BJ Local 1201, the blue-collar union representing bus aides, cleaners, mechanics and others. Hundreds of its members have received layoff notices that would take effect July 15 if no action is taken; the entire workforce would be laid off by the end of the year with no intervention.
Knudsen said no decisions had been made yet on whether the layoffs will take effect. Union officials have said they put millions in concessions on the table to save jobs but have not heard back from the district.
"Right now, we're still talking to the unions," Knudsen said.
Comments (100)
Finally, at least some language for collecting delinquent taxes. It's about time somebody realized the city is sitting on a freakin gold mine in uncollected taxes. Whether or not they actually do is another matter, and I'm sure the foot dragging will go on forever. Still, the city is up to about 300 sheriff sales a month now. Way short of the mayor's goal but at least going in the right direction.— Gilliam- just like the PSD restructure in bankruptcy court
— barry m goldwater - "just let" — barry m goldwater
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- This is what is wrong with years and years of Affirmative Action. Instead of an equalizer, it is viewed as an entitlement in the AA community. So everything starts with that advantage and they don't even notice and they still blame people that look like Romney for all of their lazy habits. Affirmative Action is like a drug. A needle in your arm that you can't shake off. Chaka Fattah and his wife Rene Chanault, for all of their affluence insist that they and their children still require the Affirmative Action Advantage. That is a fact. Case closed.
— DarnelX - GP Tank, if they were a real business they would have gone into bankruptcy hundreds of times over. The problem with these folks is that they have no clue. I've concluded that the Superintendent and CFO and including whatever the heck kind of hybrid Kneudsen is - they are just figureheads. They do not have control over the entire operation, especially the thick layer of high level bureaucratic incompetence there. It is simply stunning. I have witnessed it first hand working at 440 for a few years. They keep many things secret from the Superintendent. Take Ackerman, for instance. There is so much to digest, they just spoon fed her information. She wasn't smart enough to know that she didn't know that. She was blamed for things that she really never knew about. We all laughed at her being too dumb to not even know what was going on right under her nose. We had a $3.2 Billion annual budget in her years. One person can not possibly know it all, and especially her. She had no idea on how the budget ran, and the budget book was kept deliberately cloudy so things could be done. Look where that got us. Vendors got rich and the school district was thrown into virtual bankruptcy.
Investigators were duped.
Mr. Butkovitz, Hint- Look more closely at the bond swaps and follow the money on the contracts.
.— DarnelX - have fun prop owners— raynesrock
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- SDP is one big black hole.
— Go-Eagles - This shortfall isn't about the SDP mis-handling its money. This about the city not collecting tax money that is due to the city/SDP. — F. Harry Stowe
- dont worry folks, the brothas and sistas are sure to fix this. yes, they've been in charge for the last 20 years, but they just need a little more time in office..
oh and dont worry about the $282 million, I think the hard working educated folks who work in Philly wont mind paying a little extra— astroqueen0 - Once again, no plan to control costs and no plan to reform anything. Just another cry for money...— psyrus
- The Federal Government should borrow from China and loan the money to the state. The state can then loan it to the city. The city can lend it to the School District. There, problem solved.— jasjfarrell
- "Officials say they want to make up the money by collecting delinquent taxes"
Why hasn't this been done already?????? They never thought of this action until the school system is in a financial crisis? Somethings never change including the SRC!! Enough said.— oneway - Comment removed.
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- Maybe tell Kenny Gamble his $2mil. in free rent for his poorly performing charter school is cancelled before you cut anything.— mick-of-the-moment
- Collect delinquent taxes? 30% of owners are behind in payments and many of them haven't paid taxes in 5 years; so why start now? They're not going to pay up and no one is going to be thrown out of their house. It's the Democrat way of getting the voters to keep them in power.— farley
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- They are dragging their feet on collecting delinquent taxes in a no holds barred attempt to finally disband the unions by laying off more people and taking health, welfare and salary benefits away to make their corporate overlords happy. By funneling savings back to them, the CEOs can buy a new gold plated toiled seat for their yachts and other unnecessary luxuries that even the wealthiest of people don't need.— revolter
- "Officials say they want to make up the money by collecting delinquent taxes, and say they are taking steps with the city to make that happen.". On this the city has been strikingly silent. I don't believe them.— jverlin
- The blog Nazis are now censoring my re-posts of my May 6 letter to the StInq. Somehow I had it in the back of my mind that they would do this. <:( — jverlin
- It's about time; you've only posted it about 5000 times. — 165Valley
- It bears repeating if and until the lamestream liberal lunatics get the point -- FOREVER!!! — jverlin
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- Ahh, the old "delinquent taxes" solution. The majority of the money will never materialize and the borrowing will continue. Why not just close 12 schools and see what happens? Honestly, can you envision a worse scenario than the present one?— tomfox
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- And so it starts anew. The Philly schools are crying for money and it will never end. If you want to know why they can't make ends meet, just take Chaka Fattah Jr's contract, figure out why he received a boatload of money from the district for presumably no work and then multiple that contract by 1000 others just like it. The school district's budget is just a piggy bank for the politically connected.— Philly Lifer
- This is a black hole for money that will not end. It is time to start all over again in the PSD.— Wildman Bill
- Start running the schools like a business. Fund only those programs required by law. If something isn't legally mandated, then eliminate it. I don't care if it is free lunches, or whatever, get rid of it. Eliminate all unnecessary positions, and contracts not directly related to education. Eliminate all motor vehicles not used directly for building maintenance and school safety. Let the school district administrators, as well as the new superintendent, provide their own transportation to work. It may be painful, but you - the SRC - can do it. Just try.— JaxAx2Grind
- Tip of the Iceberg! 282 Million now and why stop their? This is a financial disaster. Here's a solution: Declare Bankruptcy--Fire all the people involved in this morass and start new. New contracts and new liabilities. First figure out your revenue stream and learn to live within it.— A. Martinez
- The PSD should declare bankruptcy! Renegotiate everything from contracts to leases to whatever. START over!!!— SPENDSPEND
- Even if all the delinquent taxes are collected, that will solve the problem for maybe 2 or 3 years. Then what?— Niko
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- This is not a black or white problem, so Lucifer and Astro Queen keep your racist drivel to yourselves. There are people of all ethnicities stealing from this city and until they are cut off, the problems will get worse.— mjwilliams75
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- Why do they keep revising this figure upward?? They should know by now how deep they're on! No self-respecting CFO would EVER run a business this way! Dopes!— jverlin
- even with avi the sdp will not be able to keep up with the deficits. Union 32bj is done and should and will be laid off. Wait until people get there new tax bill with AVI it will be the down fall for the teachers union next contract. The major cause of the deficit is the pensions and health insurance cost for the teachers that just keeps increasing every year. The city can't afford the rising cost and the rich are going to move and this is what you call check mate for the middle class with raising there taxes.— PhillySM
- I'm sure the City has been going after tax deliquents for many years but unfortunately it takes a long time to finally get a court judgement. I think the only way to address the deficit is to half the number and the salaries of administrators. I would leave the number of teachers alone since there is a direct relationship between the number of students to be taught and the number of teachers required. I would reduce the number of school buildings and initiate late afternoon and evening school hours for all school buildings so that a smaller number of buildings can accommodat a larger population of students; this would also allow the PSD to reduce the number of building maintenance workers and custodians.— BobSG
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- Per the following from the NYC budget, it'd be a needed laugh for current Phl taxpayers to watch our Confederacy of Dunces whine about why this wouldn't work in Phl. "Trash Fee to Target Nonprofits
By MICHAEL HOWARD SAUL
Deep inside New York City's recently approved budget is a $17.2 million revenue estimate for Mayor Michael Bloomberg's controversial plan to charge universities, religious institutions and nonprofits a new garbage-collection fee."— axxell - Comment removed.
- So they're spending billions over in Europe looking for the Black Hole when it's right here. The tragedy is another lost generation of children who have to face the future without a decent education. Oh wait, it's not about the kids, it's about the teachers, their unions and the fat politicians sucking up money from an impotent electorate that doesn't care.— audiesgirl
Seize the assets of one financial terrorist (aka banking CEO) and there will be plenty of money to fund the school district. Better yet, seize one of the too big to fail banks, make it a national bank, and then lend the money to government at no interest. The biggest waste of taxpayer money is interest on debt to private banks for money that is needed for public interests.— jp8899- Cut spending and close more schools! Failing institutions need to fail. Stop throwing money at them. Keep the best performing schools and keep them full. Recommend charter schools. Stop the waste of taxpayer funds. The monopoly on the education business is over.— anti-tax
- There's just a lot of hot air right now from the SRC and city council. You can't believe a word out of their mouths.— nikki1231
- Giveme, giveme, giveme, more, more, more, I am a school district, give me. more, NOW!— sawtooth354
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- I await the articles from Rant Kinney and Rony about how evil the pubilc school systemis leavign kids inthe dust leik they did Catholic Schoosl whihc clsoed due to inability to fund........ But thank God we were able to flip the OT for the police force the last 3 days for Occupy and a concert so they could drag Daryll Hal from his grave and also score Queen L who has not produced an album since 1995 I believe...... But Nutter was able to act tough again from behind a mic so it is all worth it - America's mayor. Keep voting D philly - it is workign soooooooooooo well. so what do we do once we tax the rich to death to nothing and we still have a deficit? Because that is what reality is even if they taxed the rich poor......
also - whatever happen to that New York firm that they were going after the firefighters died? Did the D machine realize that their pockets were lined by these guys and two fire fighters lives are easy to forget about 2 months later? Is that the tax enforcement we are going to get?— reddog44 - Total Propaganda.
If the Public Schools were fully funded, the City Has Enough money in this year's budget.
This "Deficit" is how much it would cost to create the "Charter Schools" that are what should be, at this point, the School District's
Wish List...and Lisa Nutter's, and Kenny Gamble's, and several Senator's...and any others trying to rip Philadelphia off...
Charter Schools Do Not do a better job educating, you have published the statistics in this very paper, do your homework, and stop printing propaganda.— murphthesurf - yet the sheep in this city will still flock to the polls in November for the same party that has controlled the city for 60 years— 420Phillie
- even worse...70 years — barry m goldwater
- Budget problems signify people's problems with making tough decisions. Look at a family that is living off of minimum wage... they make it work by making sacrifices and tough decisions. When you hear about a company or governments budget problem it is is because someone/s decision to sacrifice something like pay raises, stipend increases, benefits etc. never gets made. The people that balance a budget should never be the ones the budget decisions affect. This will make those decisions and sacrifices that have to be done easier to make...and maybe those sacrifices will help that family making minimum wage in the future by opening up new spending programs for them.— patrickj
- Why not close all the Philly schools? Only about half of the high school students graduate. This is not a money problem; this is a family/parenting problem. The Amish and Mennonite communities spend only a fraction of the money Philadelphia spends and their students are much better educated.— oneway
- Why not close all the Philly schools? Only about half of the high school students graduate. This is not a money problem; this is a family/parenting problem. The Amish and Mennonite communities spend only a fraction of the money Philadelphia spends and their students are much better educated. MONEY IS NOT THE PROBLEM!!!!!!!!!!!— oneway
- Close all PSD schools, and give each eligieble child in Philadelphia a voucher {like stock holders} valued for the money that would have gone to PSD. This forced competition would benefit most students, but alas, the dregs and trouble makers would still be loss in a system...buy them Boot Camps instead of Schools. Everyone would win!!
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- Hey Knudsen:Why then does Leroy still have a job?— aguckin
- How much more do you want the unions to give up. It's an absolute joke. They are forcing the good people who work for the district right out of the door to bring in a private outfit. If the private outfit was so much better and wanted less money it would have already happened. How about you gut the SRC AND STOP THIS INSANITY. The time I checked gamble and huff were music producers.— DJSMILES52
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- Just so that I am keeping up, Tanksley is "Tank" who is now "Cuddles"? Help me out, please...— LadySLR
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- Thomas Knudsen keep saying that union 1201 32 bj don't give back any concessions then the whole union will be layoff starting next Friday. The last time I look we have never heard a word about the manager's in Facilities and Operations being layoff there are over 45 manager's in those two departments that can help in balancing the budget. People that works hard in cleaning the building the mechanics and bus driver that provide the services that the district needs and they don't know what to do but they are saying why not the the manager's receiving note's about them being layoff.— cinda
- CleanUp Philly, so, now Tanksley is now Cuddles? Did Tanksley, who is now Cuddles, say he owes taxes and hasn't paid them? Where is this information coming from? Why would anyone with an ounce of sense admit that they haven't paid their property taxes? Thanks, CleanUp Philly for catching me up.— LadySLR
- Once upon a time the Philadelphia School District found a bunch of old junk - just junk from a lot of district offices who did not take the time to get rid of the stuff.
As the junk piled up, the SRC said, "Someone may steal from it." So they created a night watchman position and hired a person for the job.
Then the SRC said, "How does the watchman do his job without instruction?" So they created a planning department and hired two people, one person to write the instructions, and one person to do time studies.
Then the SRC said, "How will we know the night watchman is doing the tasks correctly?" So they created a Quality Control department and hired two people. One was to do the studies and one was to write the reports.
Then the SRC said, "How are these people going to get paid?" So they created two positions: a time keeper and a payroll officer then hired two people.
Then the SRC said, "Who will be accountable for all of these people?" So they created an administrative section and hired three people, an Administrative Officer, Assistant Administrative Officer, and a Secretary.
Then the SRC said, "We have had this department in operation for one year and it is now $918,000 over budget, we must cut back."
So the SRC laid-off the night watchman. More from the watchmen later!
( not original- just making a point )— uninformed - It seems that no one is allowed to know the total budget and where it is going. Over 2 BILLION dollars are spent every year. Where does it go? How much is wasted?— CharlieGall
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Inquirer reporter Kristen Graham writes the Philly School Files blog, where she covers education in Philadelphia, both in and out of the classroom.
During the school year, you’ll frequently find her hosting live chats about the district on Philly.com. Please do pass along the scoop about what’s going on at your Philadelphia public school; Kristen welcomes tips, story ideas and witty banter at kgraham@phillynews.com or 215-854-5146.
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