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On the verge of a windfall?

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It looks like Philadelphia is in for a massive sum of new dollars from the state through the federal stimulus plan – some $361 million – if the legislature approves the recommendations of the Rendell administration. That amount would dwarf the amount of new money received in any previous year, representing a 13 percent increase in total District revenues.

More than $100 million in additional dollars are already more or less assured ... these are funds targeted to low-income students, special education and technology due to extra allocations for Title One and IDEA under the stimulus. Spread over two years, Philadelphia will get a total of $161,816,900 in Title I money, $41,067,200 for special education, and $5,455,000 for technology.

And if Gov. Rendell’s proposal is approved by the legislature, Philadelphia would also get an increase of $120.5 million in basic education subsidy and another $136 million in the form of a one-time grant from state fiscal stabilization funds. Check here for the proposed district-by-district allocation estimates, broken down by category.

District officials are still trying to sort all this out as they prepare next year’s budget.

They will present a “lump sum” budget on March 25, which will include a “finalized estimate of what’s coming in,” according to Chief Business Officer Michael Masch. A decline in city tax revenues may put a minor dent in this huge potential windfall from the state. The first indication how the District intends to spend the money won’t come until April, he said.

But Masch said that the School District already has a blueprint – and it is outlined in Imagine 2014, the District’s strategic plan. Among dozens of initiatives, it calls for smaller class size, more early childhood, improving the quality of teachers – all of which are cited as permitted or desired uses by the state for at least some of the extra money. Masch said the District’s approach will be to figure out how it wants to implement year one of the strategic plan, “and then…make the funding sources fit what we want to do. We already have a plan. I’m optimistic we can do that.”

One danger is striking the right balance between funding ongoing programs and those that can’t be sustained after the stimulus package runs out after two years – small class size, for instance, is a long-term investment. A document on the state Department of Education Web site cautions districts to spend the stabilization money on “one-time expenditures that can be funded within two years and do not need to be sustained in the future,” but can assume that basic education increases will continue. Among the expenditures recommended for the stabilization funds are such things as modernization and repair of buildings, teacher training, and adult education. But districts can also use it for expenses related to No Child Left Behind and special education, a pretty broad category.

Another pitfall for the city is the possibility that the legislature will not go along with Rendell’s plans to assign close to one-third of the education stimulus pot  to Philadelphia. Already, The Inquirer quoted Senate Majority Leader Dominic Pileggi (R., Delaware) as saying that he’s not in favor of giving so much to Philadelphia and then doling out what’s left to the rest of the state. “I will insist on a fair allocation of these dollars to all of the districts in Pennsylvania,” he said. 

If the District sticks by its estimate that the Imagine 2014 plan can be implemented for $50 million in additional funds over five years, that may make it easier for Pileggi to argue to shift the money elsewhere.

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Dale Mezzacappa

Dale is a contributing editor at the Notebook. She has reported on education since 1986, most of that time with The Philadelphia Inquirer.