The Philadelphia School District must slash spending immediately and brace for "devastating" cuts that could soar past a half-billion dollars in the coming school year, Superintendent Arlene Ackerman said Thursday.
To close this year's $49 million gap, there will be immediate hiring freezes and cuts in discretionary spending. Top officials, including Ackerman, will take between six and 10 days of unpaid leave, officials said at a district news conference.
Ackerman said her priority was preserving the "core" of Imagine 2014 - her five-year plan and signature effort, which includes a costly outlay for restructuring failing schools. She also wants to keep as many instructional programs as possible, she said.
The total gap for next year is between $400 million and $500 million but could be larger, according to Ackerman. It will mean layoffs and classroom cuts.
"It will be devastating for this district if we go over $400 million," she said. "It will be more devastating if we have to go over $500 million." That would amount to about 15 percent of the total budget.
Pinpointing an exact number is tricky, with precise figures depending on state legislation, lawsuits, and government aid, none of which has been determined.
The district's 2011-12 budget totals $3.2 billion. Deputy Superintendent Leroy Nunery said the 2010-11 shortfall stemmed from not getting the $36 million to $49 million the district expected from Harrisburg through the federal education jobs bill.
Next year's projected gap is caused by the loss of $225 million in federal stimulus aid, the possible effects of a school-voucher bill, and a lawsuit that could eliminate charter-school enrollment caps, officials said.
Any cut of $400 million or more would affect students, Ackerman said.
She said the cuts would likely mean "major layoffs."
Officials said the district was looking for savings by targeting school budgets for cuts, increasing class sizes, reducing central-office staff by 30 percent, including laying off up to one-quarter of employees, renegotiating contracts with vendors, closing or consolidating schools, reducing common planning time for teachers, eliminating money for new textbooks, and laying off teachers with less than three years of seniority and other school staff.
Though layoff notices will be sent, it's too soon to say whether anyone will be let go, officials said.
Ackerman has reduced class sizes in the neediest schools, adding about 1,000 teachers during her superintendency, which began in June 2008. There are about 11,000 teachers in the district.
Even more draconian measures - Nunery described them as "extraordinarily difficult" - would be necessary if state funding decreases, which many think likely with a Republican governor and a state legislature that has made clear that it thinks Philadelphia schools have received too much money.
Those deeper cuts would mean an additional 20 percent reduction in the central-office budget, more layoffs and unpaid leaves, more cuts to athletics, art, and music instruction, and less money for student transportation.
The deepest cuts "will disrupt our core programs and our initiatives," Nunery said.
Trims for the current school year began this week and will result in a balanced budget by June 30, officials said.
Ackerman said she would take 10 unpaid furlough days, her executive team would take eight unpaid days each, and nonunion staffers who make more than $100,000 a year would take six unpaid days each before the end of the fiscal year on June 30.
There are 146 such employees, district officials told City Council.
But central-office trims and the other cuts will not save the district nearly enough. The central office budget totals about $92 million, less than 4 percent of the total $3.2 billion district spending plan; a 30 percent cut would save about $27.6 million.
Still, after the furloughs and other cuts this year, "we think we'll be in a better position to deal with fiscal uncertainty," Nunery said.
Over the last 10 years, students have fled the district in large numbers. Total enrollment, once more than 200,000, is now about 162,000, with more than 40,000 students in charter schools.
As a result, there are about 70,000 empty seats in city classrooms. The district will look to save $25 million through closings and consolidations in the next two years, Ackerman said.
"We want to find ways to use these buildings for educational purposes," she said, adding that charter schools would get right of first refusal when buildings are sold.
One item that doesn't appear to be on the chopping block is Ackerman's Renaissance schools plan. This school year, 13 schools were restructured as charters or district schools with remade staffs, longer academic days and years, and an infusion of $1 million each.
Come September, there will be 18 more Renaissance schools. Officials have said that plan will proceed no matter what happens with the budget.
News of the budget woes drew immediate concern from officials around the city.
In a speech to the Greater Philadelphia Chamber of Commerce, Mayor Nutter said the district could not afford to reverse direction on eight years of improved student achievement.
"I'm concerned that major cuts to education spending would hurt not only our young people, but also the competitiveness of our city, region, and commonwealth," he said.
Philadelphia Federation of Teachers president Jerry Jordan said sending layoff notices to teachers would be premature, but he sympathized with the district's budget predicament.
"I think that it is the perfect storm of financial woes," Jordan said. "Philadelphia has never had all that it needs in order to fund our classrooms for kids."
Under Democratic Gov. Ed Rendell, Philadelphia schools moved forward, he said.
"Now," Jordan said, "we're going in the opposite direction."
But Councilman Bill Green, who last year criticized the district for relying on federal stimulus money to fund recurring costs, reiterated that theme Thursday.
"The only people who didn't see this coming was the School District," said Green, who attended the briefing.
Still, he said, the district's plan appears to minimize classroom impact as much as possible.
And, he said, "I'm hopeful that we can help them stave off cuts as much as possible through our state and federal advocacy."