Which is it?

1. Philadelphia - the city - is enjoying a "mildly positive trend," has got its taxes more in line with its spending, and is being re-populated by "young, well-educated residents," wrote Dan Seymour, who scrutinizes city finances for Moody's Investors Service, in a report to bond buyers Thursday.

2. Philadelphia - the school district - is a shrinking entity with runaway costs, junk-bond ratings, fleeing families, and "negative" prospects, warns the same Dan Seymour, in a separate report Monday.

I called Moody's in New York to sort this out. I asked Seymour and his boss, senior credit officer Geordie Thompson: Are you talking about the same place?

"The problem is, the school district and the city are separately governed," Thompson said.

The city, run by its elected mayor and Council, taxes wages and businesses a lot, and property a little, compared with other big towns.

Lately, they've been raking in enough money to afford such questions as: Should we trim our high wage taxes, or buoy our underfunded pension plan?

The school district, on the other hand, lacks taxing power, and is losing students and funding dollars to rapidly expanding charter schools (under rules set by the state).

Which leaves the public schools begging for money from unsympathetic state and city politicians, while trying to figure out which buildings to shut and whom to transfer and lay off.

Philadelphia's "decades-long deterioration," as measured by abandoned property, has started to reverse, Seymour wrote in the Thursday report. One-tenth of the population is now college students; nine of the 10 largest employers are colleges or hospitals (the 10th is Aramark Corp.).

Even its pension plan, which eats up $1 of every $6 the city spends, "is manageable," compared with those in other big cities, Seymour told investors.

But Philadelphia - the school system - just gets broker. After sharp cuts last year, the schools now threaten to lay off more than 1,000, and boost class sizes above 40 students.

"This is credit negative because a further deterioration in education services will likely result in additional student flight to charter schools and other alternatives," Seymour wrote. If it happens, Moody's says it will cut the district's bond rating - already down at Ba2, junk status - forcing the district to pay extra when it borrows.

Charter school parents who read the summary I posted of the public school report told me they don't get the math: When students leave, why should that cost extra?

Because the school district still has to pay for its bus fleet and past borrowing and pension costs, Seymour said. It is also expensive and disruptive to consolidate schools, and tough to plan.

Seymour says he expects the public school squeeze will drive families out of town. But he acknowledged Moody's had not been looking at whether the increased availability of charter schools will also attract young families.

Won't we hit equilibrium at some point? I asked. Moody's couldn't say. Moody's doesn't track Chester-Upland schools, which have suffered Philadelphia-style charter flight. Detroit, by some measures in worse shape for similar reasons, has not stabilized yet.

So as far as Wall Street is concerned, the state-supported, chaotic shift from public to charter schools is an expensive financial experiment, with the public - families, taxpayers, and school bond investors - bearing the cost.