Amid flagging finances, cutbacks loom at Girard College

After operating as a free private boarding school for poor children for 165 years, Girard College in North Philadelphia plans to temporarily end its residential and high school programs in the fall of 2014.

The Board of Directors of City Trusts, which oversees Girard, voted unanimously Monday to ask Orphans' Court for permission to make the changes so it can cut operating costs, replenish shrinking reserves, and avert financial ruin.

Reaction ranged from bitterness and outrage to sadness.

"It stinks," fumed Robert Furphy, a 1948 graduate from the Northeast who has been active in the alumni association for 60 years. "These things have been coming down the road for the last 50 years and nobody seems to have been paying attention."

Kerry Porter, who graduated in 1996 and handles multimedia at the school, said living on campus had been important for him: "I have mixed feelings because I am a graduate and employee." And there was anguish among the 405 first through 12th graders who were told of the plans during a campus meeting that was closed to reporters.

"Can you guys make a story about how Girard College is changing students life by cutting certain grades?" one student suggested in a tweet.

In announcing the decision on Girard's leafy, 43-acre campus in Fairmount, officials said the drastic measures were necessary to ensure the survival of the school that Stephen Girard, the 19th-century merchant banker, instituted for poor orphans.

If Girard College does not rein in spending now, officials said, its funds could be exhausted in 25 years and the school would be forced to close.

"This is not a recommendation or a decision that was reached lightly," said Bernard Smalley, chairman of the board's Girard College committee. He was also a member of the steering committee that spent two years studying the school's finances, facilities, and academics before making the recommendation.

The proposed changes could affect more than a third of Girard's students and nearly half its 180 staff members, as the school eliminates its residential program and scales back operations to a handful of elementary school buildings at the lower end of the campus and mothballs other aging structures.

"These are extraordinarily painful decisions that impact the lives of our students, their families, and the many people who work at Girard College and are part of the Girard family," said Ronald Donatucci, president of the board.

"Mr. Girard wanted this school to benefit children in perpetuity, and we are confident that these changes will allow Girard College to survive and thrive for generations to come."

The plan calls for an extended-day program with more rigorous academics for 425 students in first through eighth grades in the fall of 2014.

Officials stressed that Girard's goal was to restore the boarding and high school programs once finances have improved. However, they said they were not sure when that might happen.

"The only way that the committee could make recommendations about scaling back Girard's operations is by agreeing that these changes are temporary," Smalley said.

Girard spends $42,500 per student annually to provide a college-prep education and 24-hour care five days a week.

The investments that fund Girard were battered by the recession, with the trust that subsidizes the school losing nearly a third of its value. The Girard Residuary Fund fell from a high of $333 million in September 2007 to $210 million in June 2009 and now stands at $236 million.

Since then, the school has laid off staff, ended its residential program on weekends, and reduced admissions. Three years ago, the school enrolled 645 students, compared with the current 405.

Girard will continue its residential program with high school classes in the fall.

As that comes to an end, officials pledge to provide transition services and help students find new schools, if necessary, for the following year.

Girard president Clarence D. "Clay" Armbrister said the planned changes would most directly affect 50 students who live out of state and would displace 154 students in seventh through 10th grades who would not be able to graduate from Girard.

"Every person who is at Girard is going to be affected," said Armbrister, who was named president last year.

He said he was troubled that many students who have benefitted from Girard might have to leave before earning their diplomas. "That is where it hits me," Armbrister said.

Some Girard students may be able to transfer to the Milton Hershey School, which also provides a free private boarding school for low-income students. Hershey officials said they would work closely with Girard to provide a streamlined application process.

"In general, we are all disappointed that the situation has come to this," said Peter Shoemaker, a 1960 alumnus who is chairman of the Girard College Board of Managers and cochair of the steering committee. "I think we all have recognized that no matter what the decision and no matter what the direction, each option we weighed was painful."

The private school and its walled campus are funded by income from the estate of Stephen Girard, who left a detailed vision for the school in his will.

An Orphans' Court judge will have to approve the plan before Girard College can remake itself as a day school for students in first through eighth grades. Employee unions and some alumni said they were poised to challenge the board's petition.

In addition to shrinking resources and difficulty covering operating costs, many of the school's historic buildings need extensive renovations. The projected price tag for the work is a daunting $111 million.

One project alone, repairing faulty roofs on several key buildings, is expected to cost $500,000 a year for the next decade.

The steering committee considered several options for cutting expenses to save Girard, including closing it for two years and providing boarding for half its students.

The committee concluded that running an extended day program for 425 students in grades one through eight made the most sense financially and educationally. That would allow Girard to reduce operating costs and postpone a $22.5 million renovation of the high school building. It also would enable the school to focus on younger students and offer them eight years of education.

"If we must temporarily scale back Girard's operations, we can have a greater impact on children's lives if we can reach them at a younger age," Smalley said.

Even before Girard makes the proposed switch to a day school, it plans to begin an academic overhaul in the fall with a more robust curriculum.

"Our students do well and they could do better," said Lynette Brown-Sow, a board member who served on the steering committee. "We want to be able to give them a strong academic foundation."