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Mayor plans to proceed with borrowing $50M for schools, restoring 1,000 positions

By the Notebook on Aug 15, 2013 11:13 AM


Mayor Nutter announced Thursday morning that he is taking "executive action" to borrow $50 million for the schools in time for their opening on Sept. 9. The funds will allow the District to restore about 1,000 of the 3,800 positions that were cut this summer due to the city's budget crisis. The mayor has issued a letter to Superintendent William Hite assuring him that the city will deliver those funds.

City Council, still not on the same page with the mayor about how to raise the funds for the School District, has separately provided its own assurance that the District will get $50 million.

Hite, who last week said that the $50 million was "necessary but not sufficient" to ensure the opening of schools, said in a statement Thursday that the money committed by Nutter "will enable us to provide many crucial school functions and restore critical staff positions, including assistant principals, counselors and hallway, recess and lunch monitors. This money will also help us to avoid combining grades in single classrooms, offer extracurricular activities at all schools, and ensure adequate maintenance and custodial services."

City Council President Darrell Clarke, however, says the mayor does not have the authority to borrow these funds. 

That doesn't appear to be an obstacle to the go-ahead the mayor gave the District. Asked whether Hite should still presume that the District will get the $50 million Hite had asked for, Clarke said "Correct."

Here are the mayor's prepared remarks:

A week ago, Superintendent William Hite said Philadelphia public schools could not safely open on Sept. 9 without a firm commitment of $50 million so that he can hire back about 1,000 School District employees between now and then.

Today, as Mayor of this great City, I’m here to say I WILL NOT RISK A CATASTROPHE. We WILL avoid this disaster.

I am committing to our students, parents and citizens today that schools are going to open on time and safely on Sept. 9th. Children are going to continue their education.

I am not going to let this crisis ruin the start of what is certainly a promising school year, and it’s clear to me that a majority of Council members, even with different ideas now being discussed, want the same one thing – that schools open on time AND safely.

Therefore, I am taking executive action today on behalf on our City to end this current crisis and uncertainty.

There are a number of ways to try to accomplish this goal – a borrowing, a grant, a loan or even the purchase of school buildings or school tax liens – each has its own requirements, complications and challenges.

I’ve evaluated all of the options and their respective impacts on the City’s finances.

As a result of these evaluations, I am today now directing the City Finance Director, the City Treasurer and the Budget Director to begin immediately to take all necessary steps to conduct a City borrowing of $50 million on behalf of the School District. I believe this mechanism is the best way to immediately get these needed dollars to the School District with virtually no financial impact on our City.

If Council approves a sales tax bill consistent with what’s been approved in Harrisburg, or any other legislation, it will give the City access to $15 million a year to repay the borrowing.

If Council fails to act, either the costs of the borrowing will be borne by our City’s General Fund and unfortunately it causes significant deficits for the City, or even worse, deprive our schoolchildren of a sustainable funding source because of a dispute over how best to solve our City pension problems.

Our school children did not create the City pension problem nor are they responsible for the School District’s funding problems. They should not suffer as we try to resolve it. They should not be pawns in a political chess match of leverage and strategy.

The State legislation, while not perfect, does provide $400 million to our Pension Plan over the next 10 years, while also providing $600 million in education funding over the course of the next 5 years. These are significant new funds for education AND pensions.

Second, today, I will have this letter hand delivered to Dr. Hite, informing him of the City’s commitment and asking him to immediately begin the process of hiring back the thousand or so school district employees whose return will ensure that schools open on time and safely.

Third, today, we will also hand deliver to City Council and the Chief Clerk proposed legislation to implement the sales tax extension consistent with what was done in Harrisburg.

This legislation will also include language that if the General Assembly changes the distribution of sales tax revenue to an equal split between the School District and the city pension fund, then that too would be authorized by Council with passage of that particular piece of legislation.

And I agree that the sales tax should be split between the City and School District IF, if the cigarette tax is passed in Harrisburg.

The bottom line is that we need to take action now and make commitments now in order to avoid chaos.

I will continue to work with Council President Clarke and members of City Council to take the necessary steps to support our School District in the short term while we all work with our State Legislators and our Governor on a long-term, stable and recurring financial plan for funding the education of our young people.

And so, I’m also calling upon all elected officials, school advocates, the business community, our religious communities, our parents and anyone concerned about the City’s future and its economic well-being to work together with cities and towns all across the Commonwealth on developing a new education funding formula that takes into account the student population and their needs and challenges.

Pennsylvania needs to join the other 47 states that use such student-based formulas to fund education.

Let this effort be the cause that unites us all across the Commonwealth. I believe this cause is a significant part of what quality education is all about. And if we’re successful, it’s this kind of long-lasting work of which we can all be proud.

But let me be clear at this moment, my message today is focused on tomorrow’s deadline and on Sept. 9th. We are taking these actions because Philadelphia children and their parents and their hopes for a brighter future are not going to be shattered by indecision, fear or doubt.

As Mayor, it’s my duty to keep Philadelphia on track and moving forward and that’s what I’m doing today. 

On Monday morning, Sept. 9, I expect that we’ll all be ringing school bells at schools all across the City with Philadelphia school children, their teachers, administrators and other staff. We’re going to kick off a great year of enrichment and discovery on that day.

To the parents of Philadelphia school children, I have heard you clearly and I understand your concerns, and that’s why I’m taking this action today on behalf of our children.

Young minds are preparing for greatness in our grand and beloved City. We must meet our challenges head-on, that is our path forward. I anticipate that day, and with today’s commitment we’ll have the necessary funding and staff – safe and ready to go on Sept. 9th.

Thank you.


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Comments (49)

Submitted by ConcernedRoxParent (not verified) on August 15, 2013 12:48 pm
So Darrell Clarke wants to be mayor and he thinks this is the way to do it? Who is in his packet that he is so desperate to get his hands on those empty buildings when he knows the sale of those buildings is in the District's 5 year plan? Charter Schools? That would be my guess.
Submitted by Anonymous (not verified) on August 15, 2013 12:48 pm
A contrived emergency and a contrived solution.
Submitted by Joe K. (not verified) on August 15, 2013 1:24 pm
You're half right--It is a contrived emergency but 50 M pushes Jordan into a corner. The ball's in the PFT court now.
Submitted by Anonymous (not verified) on August 15, 2013 1:51 pm
How does it push Jordan into a corner???? The SRC still wants suspend part of the PA School Code dealing with seniority. Unions will not allow seniority to be trampled on. The PFT lawyers will take care of it. I am sick of discussing it on these blogs. Let the lawyers hash it out then we'll see what happens.
Submitted by Joe K. (not verified) on August 15, 2013 2:16 pm
First of all, it pushes Jordan into a corner because now HE has to decide to send members into unsafe and badly equipped schools. Secondly, if you're tired of blogging, stop.
Submitted by Anonymous (not verified) on August 15, 2013 3:04 pm
I think your making more out of it than what it is. You're right, I won't be blogging after this comment: You and everyone else saying this is going to happen, that is going to happen is ridiculous. Fight for your rights yes!!! Trying to predict what's going to happen--NO!! My point is let the PFT Attaorneys handle it and wait for the outcome. It's a no brainer that it's going to be argued in the courtroom. While everyone is is contemplating what is going to happen next.....I'm going to take a snooze. All will be good!!!
Submitted by Joe K. (not verified) on August 15, 2013 4:37 pm
Goodnight Irene.
Submitted by Anonymous (not verified) on August 15, 2013 5:06 pm
Submitted by Poogie (not verified) on August 15, 2013 12:53 pm
Dueling Tweets of two Twits. Which one should we believe? Who Knows? But this confirms Darell Clarke's potion as the most anti-education politicians in the country. Hell Mark Gleason is better for the for Philadelphia's teachers. Yet the PFT will continue to give him and any other Philadelphia Democratic politicians contributions from my dues????
Submitted by Joe K. (not verified) on August 15, 2013 12:09 pm
They're in it together 100%. It's all orchestrated, good cop, bad cop, shell game-----Ignore all of it. The schools need full funding, not piece meal etc. Mutter's playing hero when he's doing his part to destroy worker rights. You're right about the Dems though I still have some hope for them----not much but a little.
Submitted by Anonymous (not verified) on August 15, 2013 3:25 pm
Submitted by 31st Ward (not verified) on August 15, 2013 1:38 pm
How does this make Clarke the most anti-education politician? Clarke's 11:30am press conference was attended by a majority of council and pledged $50 million for the schools without incurring new debt as the mayor's plan will do. Based on what I have read so far, it appears as if Nutter's proposal is fiscally reckless and half-baked. At least the Clarke proposal may generate new revenue for the city (through the sale of property) while preventing the accumulation of new debt. I don't always agree with Clarke, but I think he is spot-on here.
Submitted by Poogie (not verified) on August 15, 2013 2:36 pm
Are you insane?? Clarke wants to take the $120m million that Corbett who everyone claims is anti-Philadelphia schools and use that money to make sue he and his council buddies shore up their DROP payments. He is the enemy of education. He is Feckless.
Submitted by 31st Ward (not verified) on August 15, 2013 3:41 pm
First, I am not insane. Second, I support Clarke's position that the sales tax revenue ought to be split between the schools and the unfunded pension liability. This is a reasonable position that will allow us to address two critical problems with one reliable stream of revenue. Let's be honest about what Tom Corbett has offered up at this point: $2 million in revenue beyond the actual state allocation to the PSD. There is $45 million in federal money that he is using as a bargaining chip in a bizarre hostage situation designed to undercut Philly's teachers. There is also the sales tax money, which isn't state money, but rather Corbett and the Republicans in the General Assembly telling us that we should tax ourselves out of this mess.
Submitted by Kelly Jenkins (not verified) on August 15, 2013 12:53 pm
Guess he knew this was coming. That's why he's called this special meeting to do away with seniority so he can call back who he wants. On my way out the door for the rally and meeting.
Submitted by Dan (not verified) on August 15, 2013 1:02 pm
And the residents think continuing to elect democrats to office will solve the problem. How long will the residents shoot themselves in the foot?
Submitted by Anonymous (not verified) on August 15, 2013 1:20 pm
It the Republican thats not doing what they needs to do, don't forget 12 years ago who TOOK over the school district the Republican under Ridge
Submitted by Morrie Peters (not verified) on August 15, 2013 1:19 pm
I think Mike Nutter's intentions are good. Barack Obama wants what is best for children, as do all sane adults. Unfortunately, we have few political animals who have actually stood in front of a classroom or a school that they ran well. Until that day I guess it is just hope, a wing and a prayer that our children are loved, nurtured and motivated to understand that the greatest self esteem producer known to humanity is productive, fun work:-) Have a nice day;-)
Submitted by Anonymous (not verified) on August 15, 2013 1:52 pm
I will not give up my seniority rights! I will not settle for what I worked hard for to watch 1st year teachers take the place of those that have given their time and dedication to education for years and years because they are lower on the pay scale. Without a union, the principal and his cronies would be able to do whatever to those teachers not in his/her favor. The PFT must not settle for this!
Submitted by Go-Eagles (not verified) on August 15, 2013 1:14 pm
Let me translate, da checks in the mail.
Submitted by Anonymous (not verified) on August 15, 2013 4:15 pm
Trolls speaks.
Submitted by Anonymous (not verified) on August 15, 2013 2:36 pm
Why raise more money? If we pay all teachers minimum wage we can hire more without raising money. #nutterlogic #corbettlogic
Submitted by Phantom Poster (not verified) on August 15, 2013 2:55 pm
As long as the charter funding obligations fall on the district, $50 million is chump change compared to what's really needed.
Submitted by Anonymous (not verified) on August 15, 2013 3:08 pm
So Nutter comes out with the same solution that he did weeks ago. And Clarke counters with the same proposal as weeks ago. So there's nothing new here. Now it's up to the PFT to make the concessions to at least get the $45 Million from the state.
Submitted by Taxpayer (not verified) on August 15, 2013 3:52 pm
This is what it looks like when a union is dying. Complete paranoia; Everyone is the enemy trying to bring the union down. Delusions that the money is there for the union and it's just being taken by someone. Boogeymen everywhere; federal, state and local politicians, every business owner and even a sports team owner colluding to operate against the union. Yes, the PFT is dying. Put a fork in it.
Submitted by Anonymous (not verified) on August 15, 2013 3:27 pm
Quite the opposite!!! It's called the PFT Attorney team of Deborah Willig and Ralph Teti, Willig, Williams, and Davidson are the top 5% of Attorneys in the state. The courts will decide who wins ultimitely. In the end, I predict the courts side with the union!!!
Submitted by Taxpayer (not verified) on August 15, 2013 3:48 pm
We can't sue our way to prosperity.
Submitted by Anonymous (not verified) on August 15, 2013 8:12 pm
Quite being so pessimistic
Submitted by Go-Eagles (not verified) on August 15, 2013 7:52 pm
You can forget about the state court. It's stacked with republicans in the superior and supreme courts. Likewise on the federal level with the 3rd circuit and SCOTUS.
Submitted by John Jaros (not verified) on August 15, 2013 5:55 pm
I would appreciate it if someone could explain why there is no apparent funding crisis for the CHARTER schools (which are funded in whole or in part by the Philadelphia School District - PSD) while the PUBLIC schools are in such dire straits. If the PSD is really "broke", WHERE IS THE MONEY COMING FROM THAT THEY GIVE TO THE CHARTERS?????
Submitted by Anonymous (not verified) on August 15, 2013 5:29 pm
John---It's called corruption 101.
Submitted by Anonymous (not verified) on August 15, 2013 7:11 pm
The charter schools get the same amount of money per student as the district schools. Since they are privately run, they are more efficient. They don't have a bloated bureaucracy and they don't have an entitlement mentality among the teachers. They either get the job done or they fail. Either perform or go. That's why. It's no secret that free enterprise and competition work.
Submitted by HS teach (not verified) on August 15, 2013 8:11 pm
Quite a hallucination! What do you take?
Submitted by Anonymous (not verified) on August 16, 2013 7:40 pm
You say that charter schools don't have a bloated bureaucracy. My former principal is now the CEO of one charter school that has approximately 500 children in attendance. She makes over $200,000.00 per year. The superintendent of our local high school district who oversees 7,500 students makes LESS money than my former principal. This is happening at one charter school that I know of. I bet an investigation into charter schools would reveal that there is more bloated bureaucracy and more corruption going on than in the SDP altogether. Why would I think such an incredible thought? Because NO ONE is overseeing these schools. Money is pouring into the pockets of the people at the top, and our students are being taken to the cleaners. How about it, Notebook? How about an investigation into the salaries of charter school CEO's and administrators?
Submitted by Go-Eagles (not verified) on August 16, 2013 8:49 pm
My take on charter schools is that they would operate off the parochial school model with less bloated overhead making them more efficient. There is no overhead in parochial schools. There is no doubt that the charter school operators are making money hand over fist. Quite frankly, I don't have a problem with it. It speaks volumes that they can make this type of money when the district is spending the same amount. If so, why can't the public schools operate more efficiently like these charter schools? SDP is poorly run and inefficient. You talk about oversight. I'd love to see accountability. Before you point fingers, I'd love to see a forensic audit of SDP. We could all agree that there is too much waste.
Submitted by Headstart teacher (not verified) on August 16, 2013 9:26 pm
There is story after story in the news about charter operators embezzling millions of tax and grant dollars almost every day ! More corrupt than SDP for sure.
Submitted by Headstart teacher (not verified) on August 16, 2013 9:28 pm
There is story after story in the news about charter operators embezzling millions of tax and grant dollars almost every day ! More corrupt than SDP for sure.
Submitted by Anonymous (not verified) on August 16, 2013 9:08 pm
You call that efficient? When a CEO is making, as you say, "money hand over fist" on the backs of poor children? You seriously do not have a problem with that? You're one of the CEO's, aren't you? Of course YOU have no problem with that. You're taking the money that belongs to our children and spending it on YOURSELF. When can you start that investigation, Notebook?
Submitted by Go-Eagles (not verified) on August 17, 2013 11:53 am
Nope. I don't have a problem with it. It seems 55,000 parents don't mind as well. Nope. I'm not a charter school operator. Why don't all you teachers QUIT your job and OPEN a charter school? You can cherry pick your students (as teachers always say about charters), have plenty of supplies and most important, make MORE money than being a PFT teacher. Seems like a sweet deal to me.
Submitted by Anonymous (not verified) on August 15, 2013 6:32 pm
Charter School educators' salaries are far. less than our district counterparts. Additionally charter employees are at will...they can be let got at the dicretion of the CEO at any given time without union to protect as in Philadelphia
Submitted by Concerned Phila. (not verified) on August 15, 2013 6:16 pm
And now Hite/Khin/SRC/Phila. School Dictatorship have done the same thing to Philadelphia public school teachers. Shame!
Submitted by Anonymous (not verified) on August 15, 2013 10:20 pm
The teachers in our charter school receive the same starting salary as the PFT. We work in a much safer school environment and are given $1000. per year to spend on classroom supplies. Our health benefits are better and we have the same school year.Teachers do not believe the Lies from your union, check it out for yourself, you can do a lot better !!! Oh yeah, we Will receive a 3% increase with the next step this year !!!
Submitted by Anonymous (not verified) on August 15, 2013 10:50 pm
So why is the name of your charter a mystery? Surely you want everyone to check it out if what you say is true? Of course, you overlook the fact that the step increase is provided you are kept on the following year which is up to administrative whim. And how long is your work day and weekends?
Submitted by Headstart teacher (not verified) on August 16, 2013 9:50 pm
Can I have some of what you took because you are no longer in the land of reality! I call BS - prove it or STFU
Submitted by Anonymous (not verified) on August 16, 2013 6:57 pm
Our workday is 7:30 to 3:30 and we do not work on weekends .
Submitted by Anonymous (not verified) on August 16, 2013 7:47 pm
Name it, then. Why the big secret?
Submitted by Headstart teacher (not verified) on August 16, 2013 10:06 pm
'Cause it only exists in the imagination of the poster/troll
Submitted by Eileen DiFranco (not verified) on August 16, 2013 8:43 pm
So where are all those community providers Karyn Hughes promised back in January who were supposed to help with running the schools? She indicated that legions of these providers would be involved in the schools this year. Where are they? Her words at a community meeting at MLK in January to a mother concerned about her 5th grader walking a long distance to school once their neighborhood schools was closed, "Ma,am, the entire neighborhood will be watching your child." Really waiting for a response from Ms. Hughes
Submitted by Anonymous (not verified) on August 19, 2013 4:51 pm
I have got to wonder what investors would buy Philadelphia municipal bonds at this point. Philly is on most short lists for cities to follow in Detroit's footsteps. Ugh, I just realized... the teacher pension fund probably buys them... *facepalm*

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