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Pa. budget secretary to Philly schools: Hey, we've got money problems, too

By Kevin McCorry for NewsWorks on May 30, 2014 07:44 PM
Photo: Kevin McCorry/WHYY

State Budget Secretary Charles Zogby said he "didn't want to address" the Philadelphia School District's "empty shell" scenario.

By refusing to adopt a budget that would gut schools to the point of "empty shells," the School Reform Commission clearly intended Thursday evening to send an urgent message to the people in City Hall and Harrisburg who provide its funding.

One of those is Charles Zogby, the state's budget secretary. In a local appearance Friday, Zogby acknowledged the District's dire financial straits, but said the District's woes are but one of many issues that the governor has to weigh this budget season.

Gov. Corbett and the state legislature have to approve a budget before the end of June. In the meantime, Zogby said that "there's a lot of fluidity" and that "all options are on the table." He said that finding more money for schools is going to be extremely difficult given the state's own budget gap, which hovers between $1.3 and $1.5 billion.

The state's revenue collections have fallen well short of expectations.

"Everybody's strapped for cash, including our families that continue to struggle," said Zogby. "So the governor has to take that into account as well as he goes about his decision making."

Three of the SRC's five members were appointed by Gov. Corbett: Chairman Bill Green, Feather O. Houstoun, and Farah Jimenez.

"When they call, we listen," said Zogby. "There's an ongoing dialogue. They're very good advocates for the District, and sharing with us the challenges they face."

Education advocates have called for a number of revenue-generating options, including a statewide severance tax on Marcellus shale drilling, accepting federal help to expand Medicaid, and raising taxes on state businesses.

Philadelphia City Council voted last year to levy a tax on tobacco sold within the city, but before it can be implemented it needs the blessing of the tax-averse, Republican-controlled state legislature. So far, education advocates in Philadelphia have waited in vain for that blessing.

Of a possible tax to raise additional school funding, Zogby said:

"Revenues have not been part of the discussion heretofore, but again, I said earlier in the year that all options are on the table."

Read the rest of this story at NewsWorks

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Comments (30)

Submitted by Anonymous (not verified) on May 30, 2014 10:00 pm
Tax the frackers taking natural gas from Pennsylvania! Every other state taxes their frackers!
Submitted by Anonymous (not verified) on May 31, 2014 6:33 am
They should pass a budget that keeps existing service levels and keep going until the money runs out. At some point, the bank will run dry and the state HAS to step in. They did it with Chester. Delaying the start of school just makes us look bad. If the money is spent, they red nothing more anyone can do. If we pass an even more stripped down budget, they'll think we can get by.
Submitted by Anonymous (not verified) on May 31, 2014 6:56 am
Get Open Data Philly (www.opendataphilly.com) to make a countdown to zero widget that anyone can put on their website. We'll get the whole city behind it. Keeping the existing services puts the charters in the same boat as us. When we run out, they run out. It forces the state to act. Passing a doomsday budget only ensures that charters get the same money and our schools suffer.
Submitted by Anonymous (not verified) on May 31, 2014 6:03 am
Let the money run out and sue the state: http://articles.philly.com/2012-01-30/news/31006105_1_state-subsidies-ch...
Submitted by Anonymous (not verified) on May 31, 2014 6:14 pm
Every other state also taxes pension income. You guys currently pay 0% to the state on your lifetime $70k checks. State employees are the biggest tax evaders in the commonwealth. Btw, I'd tax he frackers too. But unlike state pension recipients, they DO already pay something.
Submitted by Anonymous (not verified) on May 31, 2014 7:39 pm
Reference please.
Submitted by Anonymous (not verified) on May 31, 2014 7:16 pm
You should have become a teacher if you think it's such a great pension. You sound a bit jealous to me.
Submitted by Ron Whitehorne on May 31, 2014 9:18 pm

Where do you get your facts?   As a retired teacher I pay federal and state taxes on my pension income at the same rate as I pay on wage compensation.   And, incidentallly, I, and my fellow retirees paid into the pension fund all our working lives while the School Districts shortchanged the fund, creating the current problem.   Pennslyvania has one of the most regressive tax systems in the country but retirees are not its beneficiaries.

 

Submitted by Publius1788 (not verified) on May 31, 2014 10:17 pm
Dear Mr. Whitehorne, Sir, I am not sure who is correct. I was told that the Commonwealth of Pennsylvania does not tax pension income. I just checked the Pennsylvania Department of Revenue page, Frequently Asked Questions, “Is retirement or pension income subject to state and local taxes? As long as you retire and receive distributions from a PA qualified pension plan by either meeting years service or age requirement in the plan, your retirement income is not taxable for state purposes.” You may want to contact a tax professional if you think you have been paying state income tax on your pension. I do not know if Philly taxes your pension. I am willing to bet they do, but I cannot find the information at this time. Sincerely, Publius 1788
Submitted by Ron Whitehorne on June 1, 2014 8:41 am

Thank you for sharing the source of your information.   I will check with my accountant to clarify.   I do not pay Philadelphia taxes on my pension income.  

Submitted by Christa (not verified) on June 2, 2014 8:40 am
Teachers pay between 6.5% and 10% of their income per pay towards pension. Teacher pensions are subject to Federal taxes but not state and local taxes as per the PSERS website.
Submitted by Anonymous (not verified) on June 2, 2014 11:14 am
Taxing pensions is only part of the solution. Even if 100% of the money were dedicated to the pension fund, it would only begin to deal with that $50 billion shortfall and the ongoing budget crisis it has created. But before going back to the people for the umpteenth time, which will be necessary, it is only fair for the people benefitting from the $48 billion dollar shortfall to pay state income tax on their income like the rest of us. None of the people advocating higher taxes will say a word (other than reflexively opposing anything that harms their own financial interests) on this huge pot of potential revenues.
Submitted by Anonymous (not verified) on June 2, 2014 5:24 pm
Every state does not tax pensions!
Submitted by Anonymous (not verified) on June 2, 2014 9:55 pm
Completely false. Makes me wonder if the state workers actually don't realize how thoroughly the system is stacked in their favor, against the private sector taxpayers, or if they're just lying to protect their unjustifiable tax haven status. Though not true that PA is the only state not to tax pension income. Mississippi is the other. Here is a link, though you can also Wikipedia it: http://www.kiplinger.com/tool/retirement/T055-S001-state-by-state-guide-... Note that this includes all taxes, so DE with no sales tax is "very friendly" state even though it only exempts $12,500 of retirement income. PA gets a mark for high property taxes (hmmm... where does that money go?) For us private sector workers, 401K's are exempt, though unlike pensions and unlike their treatment in most every other state and fed, PA taxes contributions. So we lose the 30 years of compounded returns too. State/ city worker pensions on the other hand, worker contributions make up only 10%-20% of the actual cost of the pension (hence our $48 billion state deficit), so 80-90% of state worker/ teacher retirement income in PA is NEVER taxed. That my friends is a much bigger tax evasion racket than the shale gas producers have by a mile. I won't wait for the outpouring from the usual suspects about the need to pay their fair share. Justice, equality and taxes only apply to others.
Submitted by Education Grad ... on May 30, 2014 11:45 pm
Zogby is full of crap. The Commonwealth spends tens of millions of dollars on cyber charter schools which are of questionable educational value at best.
Submitted by Anonymous (not verified) on May 31, 2014 12:13 am
What do you expect from the former Secretary of PA ED who turned over Chester to his buddies, Edison. They got extra money when they asked for it and still managed to run that school district into the ground. Zogby then skipped off and worked for William Bennett, but I guess that didn't pan out so now he's back working for another governor. Tune in next week for The Many Jobs of Charles Zogby.
Submitted by Vivian Rodriguez (not verified) on May 31, 2014 12:18 am
I agree with that 100%. The Charter School business is breaking the bank. And Philadelphia insist in investing extra monies in Renaissance Charters and Charters that are not even performing as expected.
Submitted by Rich Migliore (not verified) on May 31, 2014 9:26 am
Zogby has always wanted to destroy the School District of Philadelphia from the inception of the Charter School Law and Act 46. At one of the earliest Coalition of Charter School conventions, back at the beginning of the last decade, I personally observed him say that it is "time to break up the School District of Philadelphia" and he began to "bump chests" with like minded people during a social segment of the convention. It was eery. They also waste $70 Million on the high stakes testing which lacks credibility and is actually fraudulent in nature as it is based on the junk science of VAM. That is all part of the insidious game of privatization to turn our schools into private enterprises for private profit. That is one reason why the parents are becoming wise and the 'Opt Out" movement is rising. We need to "Vote Out" Zogby and Corbett.
Submitted by Education Grad ... on May 31, 2014 2:49 pm
Rich, Since you are both a lawyer and an educator, I am curious what you think about the SDP suing the Commonwealth for violation of the "mainetenance of a thorough and efficient system of public education"? Chester-Upland SD sued the Commonwealth for underfunding, see http://pennrecord.com/news/4508-chester-upland-school-dist-sues-pa-for-l.... The Commonwealth had to pay the CUSD over $30 million: http://schoolfunding.info/2012/09/pas-chester-upland-school-district-rea....
Submitted by Anonymous (not verified) on May 31, 2014 3:21 pm
That would be a loser of a case. It would be interesting to see the argument how a budget that has grown at three times the rate of inflation over the last ten years is somehow "efficient."
Submitted by Rich Migliore (not verified) on May 31, 2014 3:12 pm
I think that I should thank you for providing me with that link to the "MEMORANDUM RE: FINAL APPROVAL OF CLASS ACTION SETTLEMENT" of the federal District Court. That is something I have wanted to read for some time now. I also think I should put you on my research team.The link to the actual Memorandum of Law of the U.S. District Court is here: http://schoolfunding.info/wp-content/uploads/2012/08/PA-Opinion.pdf Yes, there is a possibility that such a law suit would work for a temporary infusion of funds into the district, but I would have to do a big bunch of additional research before I could give you an authoritative legal opinion. Obviously, the elected school board won. But I assure you it will not provide a long term solution. Only the legislature can do that. In that case the newly "elected school board" and others filed the complaint and did receive additional funds. However, immediately thereafter Zogby and Corbett acted to push through legislation to 'takeover the district once again." To me, that was a retaliatory act. Now the only power the elected school board has is to tax the community of Chester-Upland. The new type of board of control has all other powers, and if I recall correctly, the elected school board is otherwise powerless. It is kind of scary huh? I just read an article the other day that CUSD is at this very moment $5 Million short because of all the money going to the charter schools, which of course, is dominated by Vahan Guregian, and he extracts into his privately held "management company" as much as $5,000.00 per student. ELECTIONS MATTER -- that is what I think.
Submitted by Education Grad ... on June 1, 2014 2:56 pm
You're welcome, Rich. Yes, elections matter! This is why the PFT was asking members to obtain signatures in order to put the abolishing of the SRC onto the ballot in November. Those who want to destroy the PFT and the School District of Philadelphia can say all they want. However, when the parents and students speak, they overwhelmingly support teachers, nurses, counselors, paraprofessionals, and other staff persons who work in District-run schools. The parents and students see that teachers and other staff persons are working hard, most going above and beyond, to provide safe, high-quality learning environments for students. We come early and stay late. We buy copy paper and supplies out of our own pockets. We break up fights. And we do our best to teach our students what they need to learn. The parents and community members that I know don't support teachers, nurses, counselors, paraprofessionals, and other PFT members having to take a pay cut. Parents and students want quality schools in their own neighborhoods. Everyone who cares about our schools needs to continue to advocate for more money and keep the pressure on public officials to fund our schools!
Submitted by Anonymous (not verified) on May 31, 2014 12:37 am
If ANY of this was true, we'd have a "charter school crisis," a "taxing the frackers crisis," or a "private prisons crisis." Instead, we have a "constitutionally guaranteed education crisis." I wonder if they lie intentionally, or if they are just that far removed from the reality of a normal person'a life.
Submitted by Taxpayer (not verified) on May 31, 2014 10:27 am
Welcome o the real world, government workers. Contrary to popular belief, there is no magical money tree from which to pull cash. The school district will have to work with what it is given.
Submitted by anon (not verified) on May 31, 2014 8:53 pm
taxpayer, i'll bet you used to get a lot of nuggies in high school. give it a rest already. go out and get drunk or something. you're wrapped too tight. it's not healthy.
Submitted by Anonymous (not verified) on May 31, 2014 9:06 pm
Please don't feed the troll.
Submitted by Anonymous (not verified) on June 1, 2014 3:16 pm
The state has no money for the same reason the city has no money. public sector pensions. Pols bought votes and cashed bribes by promising billions in unaffordable benefits to be paid for by taxpayers decades in the future. This is the future. The well done run dry. The state could tax shale to the brink and all the money still wouldn't cover the multi billion dollar pension hole they created by jacking up everyone's benefits 30-50% in 2001.
Submitted by Poogie (not verified) on May 31, 2014 7:34 pm
New Complication in school funding. SIXERS MIGHT PUT PRACTICE FACILITY IN CAMDEN. What worse calamity could befall Philadelphia??? God we got to throw money at them. We have already given the Eagles and Philles millions in tax breaks and sweetheart leases of facilities built with public money. Why not split the sales taxes with the SIXERS? Look for groundswell of support of funding for Sixers. To Hell with the unruly schoolchildren!
Submitted by Anonymous (not verified) on June 2, 2014 9:24 am
If you were married to Zogby, wouldn't you drink? We have to put up with his financially ruining the SDP.
Submitted by Anonymous (not verified) on June 2, 2014 4:32 pm
Zogby needs to take care of the home-front first before the PA state budget. He was caught stealing from the children of PA for not funding schools properly. All in the family thing. This is a verified news report, why is Notebook deleting valid public information? It's not an opinion-all facts. Article about Zogby's wife, that received privileged status from the judge , because of who she knew. She commits two thefts, two DUI's, driving with a suspended license and eluding police ,leading to a police chase and gets a slap on the wrist. Any other citizen would have gotten jail time. Georgina Zogby YORK, Pa. (WHTM) - Georgina Zogby, the wife of Pennsylvania Budget Secretary Charles Zogby, has been sentenced to house arrest for one of her two drunken driving arrests last year. Zogby, 48, was sentenced in York County court Monday to 90 days of house arrest. She had pleaded guilty to charges resulting from the incident in April. Authorities said Zogby had a blood-alcohol content of .117 when she crashed and overturned a BMW last September near her Fairview Township home. She was also driving under a suspended license as the result of a drunken driving arrest in Cumberland County on July 10, when police charged her with DUI, fleeing and eluding, and several traffic offenses. Police have said she was highly intoxicated when she refused to stop for an officer near Mechanicsburg, even after stop sticks were used to puncture her tires. The incident sparked controversy among critics of Gov. Tom Corbett after an on-duty state trooper assigned to the governor's security detail left his post at the Executive Mansion to drive Zogby home from the Cumberland County Prison. She is scheduled for trial in that case next month. In May, Zogby was sentenced to five years of probation and 60 hours of community service after she pleaded guilty to two counts of retail theft in Cumberland County. Prosecutors said she was caught shoplifting at the TJ Maxx store in Hampden Township in January 2010 and stole groceries from the Wegmans in Silver Spring Township in May of 2011

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