At last week’s School Reform Commission hearing, in addition to the grilling of District staff that proved that Commissioner Heidi Ramirez might very well be the smartest person in the room, was – finally – a presentation on the School District budget.

It should be noted that through an entire summer, while the state education budget was clearly unraveling, the SRC did not hold a single budget briefing until Wednesday – after delaying their September meeting for two weeks and after the media reported a $160 million deficit that apparently may still be growing.

The District’s budget document is a snapshot of what the District is thinking now that it’s finally acknowledged a devastating gap of at least $160 million. If there’s any indication of how significant a figure this is, the District’s expendable budget (the money that’s not legally obligated) is only about $1.6 billion. That means that a budget gap of $160 million or more is at least a 10% cut.

Here’s what the District listed:

District Budget Options-Sept09

If you look at the document above, there is a big box in the middle that says “CAN’T CUT” and which totals $737 million in legal mandates. Below the box is another $754 million locked into grants and $80 million in food service funds that are subsistence level as is.

But above the box outlined and in bold are specifically delineated line items that are chilling to say the least:

  • School Budgets – instructional and administration – this would be teachers, librarians, aides, discretionary funds, etc.
  • School Operations Support – facilities, transportation, and safety
  • Special Education Operational Funds
  • Administrative Support Offices
  • Counselors
  • English Language Learners Operational Funds
  • Nurses
  • Psychologists

It’s baffling why the District took the time to outline the last four items as independent line items in particular, mostly because they are a pretty random selection. Meanwhile, questionable items like the $4 million for the BRT isn’t explicitly listed, nor the employees from the Controller’s Office, nor EMO management fees at $9.2 million, nor consultancy contracts for various entities, nor a host of other things. Instead this list inexplicably goes after the heart and guts of our schools.

Chief Business Officer Mike Masch – in response to questioning testimony – backpedaled a bit and said this is not what the District intended to cut but what they could cut given the legal mandates and requirements. But if that’s true, then why are the most vulnerable things listed in bold print and outside the CAN’T CUT box. One can only assume that the District listed them because they’re potential targets.

In contrast, during the Vallas years, the District always included a slew of contracts on their cut list, contracts for things like City Year (which in other cities is mostly funded through the City and private donations), ROTC, Princeton Review, among others – to somewhat balance out cuts that targeted direct school services like teachers and school discretionary funds.

It should also be noted that on this same day, the District put forward resolutions totaling more than $11 million in expenditures that are worth a second look, including:

  • $45,000 for Harrisburg lobbying;
  • $75,000 for a consultant position for a former colleague of Dr. Ackerman’s, who worked with the School CEO in her previous positions in Washington, DC and San Francisco;
  • $395,000 to Public Financial Management for finacial services that sound like they may help;
  • $830,000 to City Year (a frequent budget target in the past though unsuccessful due to its political popularity); and
  • $2.5 million to Voyager Learning for instructional materials; and
  • $7.3 million to McGraw Hill also for instructional materials

Doesn’t sound like a District that’s trying to conserve costs, does it?

In terms of language, this is not a deficit yet. The District has not ended the year after all. But it is an indicator that serious problems for our kids are right around the corner. And with Mr. Masch insisting that the District is “fiscally on track” and SRC Chair Robert Archie cheerfully explaining he’s an “optimist” to the Notebook, you have to wonder whether anyone is watching with careful eyes.

What do you suggest? Take our budget poll.

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