SRC proposes $2.89 billion budget
The School Reform Commission proposed a $2.89 billion budget for next year and formally requested $264 million from the city and the state.
THE SCHOOL REFORM Commission formalized its request to the city and state yesterday for $264 million in new revenue - the combined amount proposed by Gov. Wolf and Mayor Nutter.
By adopting the lump-sum statement, required by the city charter, the SRC made official what was already known: It needs $84 million to close a projected budget shortfall next school year, and anything additional will go toward implementing Superintendent William Hite's Action Plan 3.0.
The district's total proposed budget is $2.89 billion, including $159 million in new money proposed by Wolf and $105 million in new revenues proposed by Nutter, up from $2.6 billion this year. While the district is hopeful that the money comes to fruition, top Republican lawmakers in Harrisburg have already made clear that school districts should not count on the money proposed by Wolf.
"Our target is not to balance the budget, though," Matt Stanski, the district's chief financial officer, told reporters before the SRC voted at a special meeting. "Our target is to get $264 million in new, recurring revenues [because] we desperately need it. The status quo is just . . . it's not acceptable for our students."
If the district somehow receives the $264 million in new recurring funds, it would use approximately $180 million of that for Hite's Action Plan. According to Stanski, nearly three-quarters of that money would go directly to school budgets, allowing principals to use the dollars for resources such as advanced-placement courses, counselors, nurses and climate support. Other portions would go toward turnaround schools, facilities improvements and alternative school programs.
The district will end this fiscal year with a $6.8 million fund balance, but that will quickly be eaten up to help close next year's projected shortfall, resulting from increased costs for charter schools, pensions, health care and debt service.
And if all of the proposed funding goes through, the district would likely see its charter-school costs skyrocket from $760 million in 2015-16 to $877 million in 2016-17. That's because Pennsylvania law says districts must fund charters based on prior year per-pupil spending in district schools, meaning that if spending for district-run schools goes up in 2015-16, spending for charters would see a similar increase the following year. The district hopes that increase will be offset by implementation of a statewide fair-funding formula that would include charter reimbursement, Stanski said.
At a separate meeting yesterday, the SRC approved the refinancing of some existing bonds to a lower interest rate and the issuance of new bonds for capital costs. The transactions are expected to result in a net cost of $400,000 annually through 2023.