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Budget banks on $180M in new aid, 10% pay cuts

By Benjamin Herold for NewsWorks, a Notebook news partner on Mar 28, 2013 06:05 PM

Updated | 10:15 p.m.

The struggling Philadelphia School District, hoping to close a $242 million budget shortfall for next school year, plans to slash labor costs by 10 percent more and hope for a huge influx of cash from the state and city.

The School Reform Commission voted Thursday evening to approve this so-called "lump-sum budget," which totals $2.66 billion. The 2013-14 school year will be the third in a row in which the District, staggered by sharp reductions in state and federal aid as well as poor financial planning, has had to make deep and painful cuts to balance its books.

In a press briefing Thursday afternoon, Superintendent William Hite told reporters the District would ask for $120 million from Harrisburg and $60 million from City Hall, part of a painful effort to fix the District's "structural deficit" without again resorting to borrowing money to pay its bills.

"I'm agnostic on the 'how'" legislators come up with the new revenue, Hite said. "We'll take anything."

A presentation to the SRC provided details on the District's predicament, including how state aid to the District took a $201 million hit two years ago from which it has not recovered.

Absent new financial commitments from the state and city, the District would expect only a 2 percent increase in revenues next year. The lump sum budget instead projects revenue will go up by a hefty 10 percent.

The $133 million in hoped-for savings from personnel costs are to be achieved by concessions from workers, not further reductions in force.

Those savings would require an average giveback of 10 percent in salary from all employees, as well as a 10 percent contribution toward benefits costs, officials said. For employees like the District's blue-collar union workers, who have already accepted cuts in compensation, the District's demand for concessions would be reduced accordingly.

Officials hope to save millions more by reducing contracts with outside vendors, streamlining the District's transportation system, cutting 8 percent more out of the District's central administrative budget, and being more energy efficient.

"We are seeking multiple ways to address the challenges that we face," Hite said. "We're trying not to impact schools any more than they've been impacted already."

But while the District isn't planning on further cutting schools' already decimated operating budgets except where enrollments declined, the loss of millions of dollars in federal grant money this year -- due to sequestration, the expiration of stimulus funds, the expiration of grants from the U.S. Department of Labor and the U.S. Department of Education, and cuts in Title 1 funding, among others -- will mean more direct hits on the city's classrooms.

All told, Hite said, that could mean $134 million less next year for "highly impacted groups of students," including those who have special needs, those who speak English as a second language, and those who are eligible for free lunch.

Some Philadelphia elected officials responded quickly to the request for additional revenues.

From Mayor Nutter: "We will very seriously consider this new SRC request for more funds for public education in Philadelphia in the context of the overall city budget and tax rate. I want to be very clear that through a dire economic recession, we have supported our children’s education with increased funding for three years in a row, and I will continue to do all I can at both the city and state levels to improve the educational opportunities of all our children.”

State Sen. Vincent Hughes, who recently criticized District officials for not demanding more state dollars, offered praise: “The SRC needs to strongly reinforce arguments made by lawmakers from Philadelphia that the Corbett administration has short-changed the city in school funding.  I am pleased the SRC is now engaged and that they are pursuing new dollars to offset local costs."

Details of the District's budget must be finalized by May 31, pending the resolution of state and city budgets. 

Additional reporting by Paul Socolar

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Comments (58)

Submitted by Annony (not verified) on March 28, 2013 7:23 pm
A 10% pay cut plus 10% toward benefits will impact classrooms, SRC, Khun and Hite! The money I spend - another $72 this week just on paper, pens, pencils, staplers, etc. - will not come out of my pocket. (This is in addition to buying a printer, ink, a set of books, etc, etc., etc. this year. This is NOT covered by the $100/year we are given and the $250 we can take off of federal taxes.) I have my own children to provide with school supplies and need to feed and clothe them. Meanwhile, you are handing the keys of the School District to charters and Mr. Gleason and his ilk are opening the doors!
Submitted by Anonymous (not verified) on March 28, 2013 7:26 pm
I don't get it. $300 million is the same figure we had last year and the solution is the same... ask people for more money!!?? How did that work out last year? It's not going to happen. The state will completely take over the district and appoint a manager just like Chester. That's going to be their response. I'm calling it now. Who else thinks so?
Submitted by tom-104 on March 29, 2013 5:05 am
uhhhh..the state took over the School District in 2001. The SRC does what they tell them to.
Submitted by Anonymous (not verified) on March 29, 2013 8:26 am
The SRC is a long ways off from the governor appointing a single manager to be judge, jury, & executioner for the district.
Submitted by Joe (not verified) on March 29, 2013 11:24 am
You must not be reading the papers or get cable. The SRC is like the Gestapo making decisions without check.
Submitted by linda (not verified) on March 28, 2013 8:31 pm
You can add on your taxes any donations made to public institutions...I add all the stuff I buy from envelopes, lables, paper, pens, pencils, tape, markers, crayons, erasers, yarn, glue, staples, batteries, cleanser...you name it It ADDS UP believe me I use H and R Block and am cleared.....otherwise the kids in my classrooms would literally have zippo.........
Submitted by Annony (not verified) on March 28, 2013 9:30 pm
You can't deduct the total amount - it is a percentage for uncompensated work expenses. Yes, it adds up but I still give a large donation to the School District that is not returned.
Submitted by linda (not verified) on March 28, 2013 11:15 pm
I get all my funds...check with H and R for the info
Submitted by Ms.Cheng (not verified) on March 29, 2013 12:11 am
Linda, as a teacher you can deduct the entire amount without having to itemize, but a deduction on your taxable income is not the same as a credit on your taxes. Subtracting the amount from your taxable income means you are only getting a credit equal to the tax bracket you fall in, e.g. 10%, 15%, 25% etc. In other words whatever the fraction of your income you are paying in Federal taxes is the fraction you are getting subsidized for your donations. This amount could be more in the case that you are barely in a higher bracket, and the deduction is large enough to bump you down to the lower one.
Submitted by Annony (not verified) on March 28, 2013 7:22 pm
Will Hite, Khun and the rest of 440 leadership take a 10% pay cut and 10% toward their benefits?
Submitted by Anonymous (not verified) on March 29, 2013 10:12 am
the people in central office that got a RAISE in novemeber should get the cut off there salary PRIOR to the raise!! the whole thing is insane, but the fact that they gave out those raises is seeming more and more suspect every time i read an article!!
Submitted by Anonymous (not verified) on March 29, 2013 1:25 pm
That better happen. That is something for all of us to be watchful for. If salary cuts are to be made, sneaky things like giving raises in November, to offset a salary cut, must be taken away as well. Then those individuals should receive the same salary cut as everyone else.
Submitted by Anonymous (not verified) on March 30, 2013 9:08 am
I don't think a lot of people know this, but I work at 440. I took a 4% salary cut and started paying for health benefits 18 months ago - the same month PFT got a 3% raise and continued to pay nothing for healthcare. Plus we also got 3 furlough days at that time (that's an ADDITIONAL 10% pay cut for each of those three pay periods.) Reading this article, I expect to get another pay cut soon. I hate the idea that the many hard-working and dedicated teachers we have in this district are facing pay and benefit cuts. But, trust me, we're all feeling the pain here.
Submitted by K.R. Luebbert on March 28, 2013 7:26 pm
Annony, you are correct! If I take a pay cut I will not be spending the about $1000.00 or more I spend on my classes next year. Regular expenditures for me (and most others): pencils, pens, highlighters, post-it notes, lined paper, copy paper, printer, ink, erasers, electric pencil sharpener, Lysol wipes for desks, hand wipes, paper towels, novels for class library, bulletin board paper, bulletin board trim, laminating expenses, the odd token or money for a kid to get home, paying for a class trip for kids who cannot afford it, DVDs on appropriate educational topics, etc.....
Submitted by Joe (not verified) on March 28, 2013 10:11 pm
They don't care even a little bit about your dedication and concern for kids, nor do they care about the kids themselves. When you don't care, you have nothing to lose. Look at the facts and tell me where I'm wrong. Just as in Chicago, our union has to fight with total solidarity leaving all options on the proverbial table. Will Jordan support and lead us is the big question.
Submitted by matt (not verified) on March 29, 2013 2:40 pm
You will be spending that money. The fact that you work now for less than you're worth and the fact that you're planning to stay next year for even less than that means that, unfortunately for you - and fortunately for the city of Philadelphia, you've got a heart. When you stop caring enough spend the money, you're going to find another job. Until then... the State of Pennsylvania is calling your bluff.
Submitted by Urban teacher (not verified) on March 28, 2013 7:41 pm
Can someone please conduct a forensic audit of the SDP?
Submitted by Anonymous (not verified) on March 29, 2013 1:50 pm
That was requested under "The Right to Know" at the SRC meeting when the school closures were confirmed. Doesn't it have to be granted when asked under "Right to Know"?
Submitted by Anonymous (not verified) on March 28, 2013 8:15 pm
This is my third, and last, year teaching in the school district of Killadelphia. We already get very little to deal with a whole lot. However, the idea that someone could ask us, teachers, to do a lot more and get paid less is laughable to me. I'd go back into private industry before I taught in this town for another year. Congratulations Philly, Ackerman, and now Hite - You Won. I'm sure you've succeed in your goal to drive out hundreds of dedicated talented teachers from this district.
Submitted by Anonymous (not verified) on March 29, 2013 1:58 pm
My plans as well. But, I don't think they care if their teachers are dedicated and talented. They don't care about students at all.
Submitted by Anonymous (not verified) on March 28, 2013 9:13 pm
The PFT better not agree to any pay cut!!! We are 15,000 strong. Lets call their bluff about stripping us of our degree if we strike. We need to walk out !!! Strike !!! We didn't create this mess.
Submitted by Kristen G (not verified) on March 28, 2013 10:54 pm
I agree that PFT members did not create the mess and it's very unfair. However, do you really - REALLY - think that teachers will come together? Do you think Jerry Jordan - our "leader" - isn't in cahoots with the SDP "leaders"? I think we're all screwed and better start cutting costs. I'm scared, but practical. The pattern has demonstrated that the District DOES NOT CARE and the PFT is WEAK. :-(
Submitted by Anonymous (not verified) on March 29, 2013 1:50 pm
The PFT leadership is obviously preparing a historic sellout of its membership. They are completely prostrate before the SRC having the illusion that people will still be dependent on them, and they can keep their large income, after a sellout. As long as the membership puts up with this there is no stopping this train which is heading over a cliff. There were 20 members of the public at the SRC meeting Thursday night where this lump sum budget based on salary and benefit cuts was passed. Little noted was the Finance Director's statement that if sequestration continues in Washington there will be 1300 layoffs next year. Philadelphia is going to be a case study in what happens when you don't fight for your rights as compared to Chicago where they are fighting for their rights.
Submitted by Rob (not verified) on March 28, 2013 9:12 pm
Whenever I walk into 440 all I can think about are the $1 million turnstiles
Submitted by Education Grad ... on March 29, 2013 12:55 am
I am hearing teachers talk about the money they spend on supplies. The PFT contract stipulates that the District must provide ample materials and supplies. Why isn't PFT leadership taking this seriously?! EGS
Submitted by Anonymous (not verified) on March 29, 2013 7:13 am
1201 leadership has already had us give back 10% to keep our jobs.....we buckeled to the threat of layoffs....Hang tough don't give in to 440 rhetoric!
Submitted by Joe (not verified) on March 29, 2013 10:55 am
That was the PFT's first big mistake. It should have shown solidarity with you folks from day 1. Dividing and then conquering is their game plan and the PFT--Yes, Jordan---remained silent as usual. ALL LABOR better start to stand in solidarity or they'll pick us off one at a time.
Submitted by Anonymous (not verified) on March 29, 2013 8:31 am
PFT don't forget you can only stay out of the job for 2 weeks. They will essential save money (in your absence) and still make the changes! Harrisburg and it's former appointees should fork over funds - they have an audit report that shows how they screwed the district when it came to buying out the former superintendent's contract. It's a shame that the people who work the hardest - principals, teachers, and support staff get the shortest end of the stick. I like what one person said previously - Hite and your team begin by showing us you are willing to take the cuts first! Disgusted Educator!!
Submitted by Anonymous (not verified) on March 29, 2013 9:35 am
Maybe the administrators got the big raises last year in anticipation of the PFT contract negotiations, so that they can agree to a pay cut that isn't really much of a cut. It's like when you go to the grocery store to buy something that's on sale, only to find out that the pre-sale price of the item has been marked up so that it LOOKS like it's on sale, but it actually costs the same as it did the week before.
Submitted by Anonymous (not verified) on March 29, 2013 10:05 am
i just commented on another response about this. its sickening.
Submitted by Anonymous (not verified) on March 29, 2013 10:00 am
Please clarify which administrators. CASA members did not get their promised raise after being hoodwinked into concessions.
Submitted by Anonymous (not verified) on March 29, 2013 11:53 am
@urban teacher- if you read Karen Lewis's press release on the Chicago Public School finances, you'll see that they are NOT in dire straits yet they are crying poor and closing schools saying the same things as the SDP: "not enough money, underutilization, and failing schools." There's money for charters alright though. Our kids are being pushed and pulled around as if they have no identitles, mostly in minority neighbrhoods which I find strange with an AA Presdent, and AA Mayor here and Dems in power in Chicago. I guess money, power, and gentrification are more important. Btw I feel the same way about the PFT leadership because I've seen them not protect their members in termination cases.
Submitted by Anonymous (not verified) on March 29, 2013 11:40 am
EGS I am really getting tired of thes silly questions. We KNOW what the PFT contract says about supplies, but do you think anyone is focused on that now with these school closings? Do you think the PFT has answered adequately in the past?
Submitted by Joe (not verified) on March 29, 2013 11:58 am
Yes, I call it Paralysis through Analysis. Folks keep looking for answers that just aren't there or are so horrible that they aren't believed. We give these folks far too much credit when we see the facts and somehow, don't internalize them as what they really are. Unless we the people begin to stand together, Public Ed. will be gone in all the urban areas and that will necessarily end Democracy in urban America.
Submitted by Anonymous (not verified) on March 29, 2013 12:48 pm
I can answer EGS although he may not believe me; In a HS years ago the principal sold all the equipment belonging to one of the vocational shops and the teacher had nothing with which to teach the kids who had to sit in a classroom for most of the year. She had the okay of the SDP admin in charge of that area. The idea was to eradicate hands on work and introduce compter modules into the curriculum. The teacher needless to say had plenty to say to no avail. IMO they focus on the wrong people, principals just run amok.
Submitted by Anonymous (not verified) on March 29, 2013 11:28 am
I read a post, not too long ago, it was from a PG County teacher. She sai Hite did the same thing in PG County. Except they didn't give back. Their pay has been frozen for 4 years. No raises for masters, ME, etc. so very familiar!!
Submitted by Anonymous (not verified) on March 29, 2013 11:32 am
Principals agreed to not take a raise until January 13th. Hite's team didn't honor the agreement. This was happen without incident. An agreement was signed and not honored!
Submitted by Anonymous (not verified) on March 29, 2013 12:50 pm
Do you expect that we will be having layoffs? I suspect that pay cuts are not enough.
Submitted by Anonymous (not verified) on March 29, 2013 1:11 pm
"All told, Hite said, that could mean $134 million less next year for "highly impacted groups of students," including those who have special needs, those who speak English as a second language, and those who are eligible for free lunch." This sure sounds like discrimination to me.
Submitted by Anonymous (not verified) on March 29, 2013 5:36 pm
Hey 15,000 strong, as a taxpayer in the city of Philadelphia I do not want my tax dollars going to pay for your union health and retirement benefits. I'm calling on my brothers and sisters of the other 89% not in the unions to say " I'm mad as hell and I'm not going to take it anymore".
Submitted by Anonymous (not verified) on March 29, 2013 5:03 pm
So you don't mind paying for cops', firemen's and politicians' health and retirement benefts, just nothing for the teachers? We're made as hell and we can say "No" too. Hope you and the brothers and sisters are willing to start filling in at the schools because we don't have to take it. Maybe eventually you will learn the importance of working with your own children on their studies. We are the lowest paid in the state in one of the toughest schools districts in the country. As much as you whine you never seem to have the guts to point the finger at the administration and politicians who bankrupt this school district, not the teachers or their union. The sad fact is that Philly teachers are a bargin considering the crap you want them to endure and the price at which you think they should work. Like the old saying, "You don't miss your water until your well runs dry". Keep dreaming, the temp. workers that the politicians are relying on will jump ship once they realize they are on their own. Teachers in Philly want a say in how the school funding is being spent and what sort of personnel can be hired, where they are really needed instead of patronage pap.
Submitted by Anonymous (not verified) on March 30, 2013 1:52 pm
I like the water metaphor. The well IS dry. The public sector unions fed at the trough until it was empty. Now either take what the government can afford, or go and work in the private sector and see what you get. Don't let the door hit you in the you know what.
Submitted by Anonymous (not verified) on March 30, 2013 9:02 am
Amen. We pay enough in taxes. Let the teachers contribute to their healthcare costs just like everyone in private industry does. Signed: The 1.5 Million strong
Submitted by Anonymous (not verified) on March 30, 2013 3:14 pm
The real insult is that public sector workers pensions aren't even subject to the wage tax. Wage tax before the public sector unions took over was 1.5 pct. now near 4pct and they still want more. There is no money because they've been bleeding the city for 50 years. All those checks Rizzo wrote in the 70s were still paying for.
Submitted by Taxpayer (not verified) on March 30, 2013 4:08 pm
That's what you get when you have corrupt politicians pandering to public sector unions for votes, making promises even the unions know can't be kept, but that they demand anyway. We now have twice as many city workers as we did 30 years ago even though the city's population has declined. Many of our productive, taxpaying citizens have voted with their feet and moved out of the city. We now have too many people on the teet and not enough people to pay for it. And the PFT's solution? Of course. Raise taxes again so they can get theirs.
Submitted by Anonymous (not verified) on March 29, 2013 8:48 pm
Non-represented employees as well as labor unions already took a pay cut. The District continues to hire with huge salaries and no one says a thing. As a district employee I am enraged that I will have to give up another 10% of my salary equivalent to $20,000 in one year!!! What will be done with the money? Who will get a raise while others take pay cuts? Dr. Hite, Stanski and the SRC just don't get it. Dr. Hite said that there would be no savings in closing schools but savings in the negotiations. PFT and CASA stand strong and vote NO!!! Go to arbitration and sue the hell out of the district.
Submitted by Anonymous (not verified) on March 30, 2013 9:18 am
10% of your salary equivalent to 20K per year???
Submitted by Annony (not verified) on March 30, 2013 11:00 am
Senior Career teachers (2 or more certifications and Masters plus 60 or two Masters) pay is now $90,000/year. That will be eliminated. The next highest pay scale is Masters plus 30 credits is $83,000. Cut $8300 from $83,000 and you're down to $74,000. So, Senior Career teachers will get a $16,000 pay cut PLUS 10% toward health insurance which is about $130/month. $130 times 12 = $1560/year. That brings the salary down to $72,400. That is a huge pay cut no how matter one looks at it.
Submitted by Anonymous (not verified) on March 30, 2013 12:23 pm
Agreed. But the numbers are too high to begin with. Teachers should not be making close to six figures. That's ridiculous. And they certainly don't need even a masters degree, let alone masters plus 30 or 60, to teach k-12.
Submitted by Anonymous (not verified) on March 30, 2013 1:32 pm
You may think that personally, but in the state of PA, no one can teach for more than 6 ears without a master's or equivalent. Your certificate can't be renewed w/o it.
Submitted by Anonymous (not verified) on March 30, 2013 7:39 pm
I think your sense of teacher salaries are skewed. Someone w/10 years experience and a masters makes between 60-65,000. Certainly nothing to complain about, but definitely not ridiculous." It's probably comparable to what many people would make elsewhere with similar credentials/experience.
Submitted by Annony (not verified) on March 30, 2013 7:13 pm
TEachers in Lower Merion, Radnor, Cheltenham, etc. make over 6 figures. Don't you want your children to have a teacher who has at least a Masters? Don't you want your children to have a teacher who have completed a thesis and graduate school tests? I'd like my children to have teachers who value formal education and continue to use that as one route for improving their practice. Have you ever taught high school? Some teachers are certified to teach Advanced Placement and International Baccalaureate. Without a masters in the area one is teaching (e.g. calculus, chemistry, history, etc.), they can't teach the course with much expertise.
Submitted by Joe K. (not verified) on March 30, 2013 9:07 pm
May I ask what field of work you are in and how much do you make?
Submitted by Anonymous (not verified) on March 29, 2013 9:44 pm
Please Jerry Jordan....DO SOMETHING! Are you there, Jerry? We already gave money back at the end of the beginning of the 2011-2012 school year. What is going to happen Jerry????
Submitted by Anonymous (not verified) on March 29, 2013 10:38 pm
Don't you read tor follow the news, attend rallies, attend membership meetings, attend Chapter meetings? Jordan has stated PUBLICALLY time and time again that "we are not going backward"
Submitted by Anonymous (not verified) on March 31, 2013 9:44 pm
What the SRC, the public, and every other urban district in hundreds of millions dollars debt is the social issues that these children face with everyday. A large majority of children in Philadelphia go home to neglected homes, with uneducated parents that have no respect or faith for the public school system (mostly because many of them were failed themselves). These children are poor, hungry, abused, suffering from severe mental illness, and the list can go on and on and on. Do you know Philadelphia has one of the highest reported cases of child sexual, assault, and neglect? How can we teach these poor children to read and take a standardized test (which scores will now be included in teacher assessments next year) when they went to bed night before in a hard floor with five siblings who were never fed dinner, let alone all night or possibly sexually abused? How can we really help these children?
Submitted by Anonymous (not verified) on April 1, 2013 4:36 pm
we been had,hoodwinked,bamboozled,led astray,run amouck.i didnt land on the school district of philadelphia,the school district of philadelphia landed on me......jerry jordon is about as sharp as a banana......hes going to concede with the dristrict,you will see,be prepared...wait till contract time be prepared all
Submitted by Anonymous (not verified) on April 19, 2013 5:15 am
Save energy? They are thinking of that now??? Instead English Language Learners and Special Ed students will pay with a $134 million dollar cut. Is anybody thinking at 440?

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