Council skeptical about school funds, but door open

After hearing Philadelphia School District superintendent William R. Hite Jr. describe the "cold, harsh" consequences of failing to fill an enormous hole in his budget, City Council members nonetheless remained skeptical Monday about pitching in more money for a third year in a row - with a possible exception.

"I'm not sure at this point there would be local funding at all," Council President Darrell L. Clarke said of the district's request for $60 million in new funding. "We can't keep going to the well."

Clarke, however, left the door open for "coming up with nontraditional revenue sources for the School District," including an increase in the liquor-by-the-drink tax.

Mayor Nutter, who previously announced his unconditional support for securing an additional $60 million for the schools, would back an increase in the tax from 10 percent to 15 percent, spokesman Mark McDonald said Monday.

The state would have to grant permission to raise the tax, which brought in about $44 million exclusively for the schools last year.

"The bottom line is . . . where do Council members stand on the notion of the $60 million?" McDonald said. "Are they amenable? And, if they are, let's look at how that would be achieved."

Hite is counting on that money, plus $120 million from the state and a series of union concessions, to fill a $304 million budget shortfall.

School Reform Commission Chairman Pedro A. Ramos said the request for the city to provide a third of the additional funding was formulated because the city traditionally covers a third of the district's budget.

The concessions sought from the unions representing teachers and school administrators would bring their contracts in line with one that building service workers agreed to last year, he said.

Ramos emphasized the "shared sacrifice" approach to filling the budget gap, which Hite said would merely restore basic education for the district's 140,000 students.

"We hope to avoid sending them to schools where even the term bare bones is inadequate to describe their education," Hite said.

Hite, in his first budget cycle since becoming superintendent, is making his request of Council after two straight years of real-estate tax increases for the district's benefit, plus the coming implementation of Nutter's property-tax reform, the Actual Value Initiative (AVI).

AVI already has kicked off considerable taxpayer discontent, especially in areas of the city facing increases from the changeover.

While the city has been raising taxes to help the schools, the state has not responded in kind. Several Council members asked Ramos and Hite to gauge the likelihood of that changing this year.

Ramos said there was a "qualitatively different feel" among state legislators, who are "no longer debating the need" to restore funding to Philadelphia schools.

"I don't hear some of the negativity," Ramos said. "There's recognition that efforts have been made locally in a short amount of time to right the ship."

Clarke also asked Ramos, appointed as chair by Gov. Corbett, to set up a meeting between Council members and the governor.

"In all honesty, I have no idea why people say the governor won't put in additional money for the School District of Philadelphia," Clarke said. "I've never had that conversation with him."

Even with a 50 percent increase in the drinks tax, Nutter and Council would need to find an additional $40 million to satisfy the district's request.

The two other major avenues for city funding are the real-estate tax and the Use and Occupancy tax on businesses. Councilwoman Maria Quiñones Sánchez has proposed a bill to raise the U and O tax, and she encouraged the district Monday to "look at those projections so we can start having policy discussions."

Sánchez also called on Nutter to trim $25 million from his proposed budget, and Clarke has touted selling advertising on municipal property.

McDonald said the mayor wasn't prepared to publicly back options beyond the drink tax.

"But they're out there and being discussed," he said. "We're willing to talk with Council members about any suggestions they have."

Council members also raised the issues of delinquent taxpayers, vacant and abandoned property, and other ills that rob and drain the treasury - all topics that have attracted renewed interest this year during the AVI debates.

"We have money that's out there that we wouldn't have to raise a dime for the schools," said Councilman Mark Squilla. "I think the best way to get money for the schools is to go out there and get the people who don't pay."

Squilla later asked Hite what the schools would look like without more money.

"Without money, it's not a school," Hite said. "It's just a building where some adults and some children have gotten together."

To which Squilla added: "A day-care."