Phila. schools seem $20 million short

The budget agreement reached in Harrisburg appears to leave the Philadelphia School District about $20 million shy of the extra state funding it needed to help close a deficit in its $2.18 billion budget.

District officials emphasized that numbers were preliminary, and as they talked early last evening, the package hadn't even been officially approved in Harrisburg.

Overall, they said they were pleased that the state increased funding for the 174,000-student district for the 2007-08 school year by nearly $77 million - $5 million more than last year's increase.

"In a tough budget year, we're very appreciative to Gov. Rendell and the Philadelphia contingent in both the Senate and the House," said Thomas M. Brady, the district's interim chief executive officer.

"But having said all that, it still leaves us about $20 million short of our optimistic projections, and some very tough decisions to be made. It will force more reductions."

One immediate concern was that the package appears to cut state funding for the district's disciplinary schools and other alternative schools by about $8 million. The district received $22 million from the state last year and is likely to get only $14 million this year, district aides said. It comes as the district continues to struggle with discipline and violence in its schools.

District officials were unsure last night how they would cope with that cut.

The district already is making $100 million in cuts and cost savings to avoid a deficit. The cost savings started last month with the elimination of 170 administrative positions, including 46 layoffs.

Brady said he had some ideas where the district would cut to make up the $20 million hole left by the state budget, but he wasn't ready to share them publicly.

As the district wrestled to present a balanced budget for this school year, it requested an additional $54 million in state funding, beyond increases already included in Gov. Rendell's projected budget.

The agreement reached this week appears to give the district about $34 million of that.

"That's a great closing of the gap," said State Rep. Dwight Evans (D., Phila.), the House appropriations chairman. "I think that the Philadelphia delegation working in conjunction with the governor did very well."

But State Rep. John Perzel (R., Phila.) said the loss in alternative school funding would hurt. Statewide, the funding will drop from $43 million to $17.5 million.

"It's the largest drop in the department of education," Perzel said. "Obviously, it wasn't a priority for the governor."

Perzel, formerly the House majority leader, had fought to keep alternative school funding for the district each year.

Pennsylvania Department of Education spokeswoman Sheila Ballen said the legislative leaders finalized the budget details.

"The governor would have been prepared to sign a budget with more money for alternative schools, but this was the budget sent to him by the leadership," she said.

Perzel, however, noted that Rendell's budget included no money for alternative schools.

Evans pointed out that the loss in alternative school funding has to be considered in light of the significant increase in overall funding to the district.

"In any budget, you're not able to do everything you would like," Evans said. "It was a tug of war for the dollars we had available."

The state annually provides well over half of the district's revenue.

Under the negotiated agreement, the district would receive $77 million more in funding this year in several categories: It would get approximately a 3.5 percent increase in basic education funding, amounting to more than $30 million. Its special-education allotment would rise more than 3 percent, or by $4 million.

The state also will reimburse Philadelphia and other distressed districts for more of their charter school costs. That will result in an additional $17 million. Funding for pre-kindergarten will rise by $16.3 million, and the district will get $9 million more in block-grant funding to be used for kindergarten programs, according to Evans' office.

The district earlier this year received about $28 million in additional funding from the city, the full amount that it had asked for.

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