TWO MORE days.
If Friday doesn't arrive with a $50 million check, Superintendent William Hite says that he will delay the Sept. 9 opening of schools.
Hite made that announcement six days ago. Not only are we no closer to resolving the issue, but the situation is worse: Hours after state and city lawmakers yesterday called on Gov. Corbett to release $45 million promised from the state, Corbett pulled out a flaming hoop for the schools to jump through, demanding concessions from teachers, whose contract doesn't expire for two more weeks.
That leaves the city to battle for the money. Mayor Nutter wants the lion's share of a state-approved increase in the sales tax to go to the schools. Council President Darrell Clarke wants it to pay down the city's pension obligation, and wants to advance the schools $50 million based on selling school properties.
Clarke's idea has focused attention on the city pension problem, and that's a good thing: Years of kicking the can down the road and weak political will has left a $5 billion liability in pension funds for 30,000 retired workers and 26,000 active workers.
The pension is a big problem, for sure, but lawmakers have avoided grappling with it for years - including Clarke himself. His voting record on even the mildest reforms going back at least five years - including a Nutter proposal to switch to a cheaper, hybrid pension plan for city workers - has sided with the status quo. So, we scratch our heads a little on Clarke's new obsession to fix the pension problem right this minute, especially in the face of the real-time crisis of school funding. Real time, as in TWO DAYS.
We also have news for Clarke and the others on the city-pensions-must-be fixed bandwagon: The school-pension problem is even worse. Teacher pensions - administered by the state Public School Employees' Retirement System (PSERS) - have a total unfunded liability of $29 billion. For Philadelphia only, a report by the Thomas B. Fordham Institute sounds the alarm about ballooning pension costs that the district faces. District payments into the pension fund are partially reimbursed by the state. Netting out those reimbursements, the report sees the cost to the district growing from $32 million (in 2011) to $139 million in 2020. (The district paid out $51 million in 2012.) State reforms in 2010 didn't make a dent. Years of overpromising, a stock-market meltdown and lack of political will have left the state's schools in what Fordham calls a "pension squeeze."
And, yes, the same squeeze holds for the city's municipal pensions. Recently, Temple University's Center on Regional Politics convened a group (including Clarke) to address the city pension problem; they favor using the sales-tax increase on the pension fund. (There are other good ideas in the report. Find it at temple.edu/corp.)
Pensions must be fixed, and soon. Consider: One of Detroit's largest creditors is its general pension fund (the other is the police and fire pension funds).
But if they aren't fixed by Friday, nothing bad will happen. Not true for the city's school students and their families if the schools don't get money.