Philadelphia Will Borrow $30M to Keep Schools Open
By Troy Graham
At the last possible moment, Philadelphia City Council on Thursday came up with the money that a struggling School District had been pleading for.
The process was ugly at times -- school officials and Council battled for weeks over the district's finances, while education advocates bombarded City Hall with protests of marching, sign-waving students.
But Thursday, after Council agreed to borrow $30 million more toward the district's $216 million deficit, the combatants expressed nothing but relief and gratitude.
School Superintendent William R. Hite Jr., who had a handful of testy exchanges with Council members at recent hearings, said the money would stave off any district layoffs for the time being. "This is gigantic," he said. "It closes the gap pretty significantly."
Also Thursday, at the final meeting before the 12-week summer recess, Council passed the city's $4.5 billion operating budget, which included millions for hiring additional building inspectors, opening libraries six days a week, and expanding programs at recreation centers.
The budget figure assumes the sale of the Philadelphia Gas Works to a private company, a deal that could end up being as contentious as the school-funding debate.
Mayor Nutter sent legislation on the sale to Council in April, but no member would introduce it.
PGW's suitor, UIL Holdings Inc. of Connecticut, can opt out of the $1.86 billion agreement July 15, but the deal doesn't expire until the end of the year.
That sets up the PGW sale as the primary issue facing Council in the fall. Gas workers and their allies held a rally Thursday morning outside City Hall, blasting the deal as bad for workers and customers.
Gas Workers Local 686 president Keith Holmes said Council had "the backs" of the union.
"No sale is going to happen unless we're taken care of," he said. Council members also said the budget included money the Nutter administration had tucked away to pay for a contract for the 10,000 blue-collar municipal workers represented by AFSCME District Council 33.
The workers have not had a new contract in five years. D.C. 33 [resident Pete Matthews told Council last week that a deal could be near, and urged them not to pass the budget until a bargain was struck.
Although Council did not stall the budget, Majority Leader Curtis Jones Jr. did cast a protest vote against it because the contract remained unresolved.
With Council in recess, attention now turns to Harrisburg, where city leaders also are seeking more funding for the schools, as well as permission to enact a $2-a-pack cigarette tax to benefit the district.
Helen Gym of Parents United for Public Education thanked Council members Thursday for supporting more funding.
"For as much heat as you might have felt . . . we promise you our attention is now on Harrisburg," she said.
School Reform Commission Chairman Bill Green, a former member of Council, said the city's extra borrowing would provide some leverage with the General Assembly.
"Now we can go up to Harrisburg and say the city did everything we asked for, left nothing on the table," Green said. "And we need you to do the same."
Council members cannot approve the $30 million borrowing, introduced Thursday by Councilwoman Blondell Reynolds Brown, until they return in September. But the district intends to budget that money for the next fiscal year anyway.
The loan would be repaid from proceeds of the city's extra 1 percent sales tax. Council this month passed a bill giving the schools $120 million of the sales-tax revenue next year. The district had asked the city for the sales-tax money plus an additional $75 million. Revenue from the cigarette tax and the $30 million borrowing could satisfy that request.
Even if the district manages to fill its budget deficit, that merely maintains a status-quo environment that Gym called "appalling," after years of painful cuts to staffing and services.
"We ask ourselves whether we're conducting a sickening social experiment on children to see how much they can take," she said. "These are not budget cuts anymore. They are human-rights abuses happening in this city to our children."
If the state doesn't come up with more money, Councilwoman Maria Quiñones Sánchez said, the city may have to find yet more cash for the schools this fall.
"Whatever it takes," she said. "We won't allow our schools to be unfunded at dangerous levels, which is what we are talking about now."
Council also passed bills that:
Approved a contract to establish a bike-share program. Allowed zoning changes necessary for a huge Drexel University development at the former University City High School in West Philadelphia.
Extended the city's "living-wage" standard to employees of city subcontractors. The workers now would make $10.88 an hour. The rate would go up to $12 an hour in January.
Contributing to this article were Inquirer staff writers Kristen A. Graham, Claudia Vargas, and Jason Grant.
(c)2014 The Philadelphia Inquirer
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