Is This Really What $2.6 Billion Buys?

The Philadelphia School District Budget Should Be Big Enough To Educate Our Kids. Here’s Why It Isn’t

Is This Really What $2.6 Billion Buys?

The Philadelphia School District Budget Should Be Big Enough To Educate Our Kids. Here’s Why It Isn’t

You’d be forgiven if, just before Christmas, you thought you’d suddenly morphed into Bill Murray’s character in Groundhog Day. That’s because the Philadelphia School District announced that, in order to maintain the same “insufficient” programs being offered this year, it would need an additional $30 million for next school year. To turn the District into one where every student would have “access to a quality education,” we’d need $309 million next year—and $913 million by 2018-19.

Wait, what? Have we all become Bill Murray? Haven’t we been here before? Each year our local officials beg Harrisburg for more money, threatening dire consequences if they’re turned away—remember the threat of a  “Doomsday Budget” a couple of years ago? Ultimately, some piecemeal, incremental agreement is reached, as it was with the recent cigarette tax. The politicians get some face-saving cover and the proverbial can gets kicked down the road for another year—another year in which nearly ten percent of our students drop out before graduating high school, another year of hardly any nurses or guidance counselors.

Meantime, the finger pointing is as repetitive as the Groundhog Day plot. Instead of talking education solutions, the gubernatorial debate consisted of back-and-forth over a verifiable fact: Whether Gov. Corbett cut $1 billion in state funding from education. He didn’t; most of Corbett’s cuts came from the expiration of federal stimulus money. His cuts actually amounted to about $300 million. That’s a deep cut, yes, but is it so Draconian that it is the dividing line between succeeding and failing schools? Were our schools so kick-ass when they had that $300 million?

In 2013, only 45 cents of every dollar allocated for District schools went to instruction—90% of which were for salaries and benefits, making personnel the biggest cost driver District-wide.

More important, instead of getting bogged down in the political who-cut-what debate, shouldn’t we back up and ask some basic questions? Like, just how do resources correlate to results in education? And, in the case of Philly, how is it that $2.6 billion is an insufficient amount to educate roughly 200,000 kids?

A look at the Philadelphia School District budget provides some answers—and, it turns out, they point to structural problems that rarely get discussed. For example, in 2013, only 45 cents of every dollar allocated for District schools went to instruction—90 percent of which were for salaries and benefits, making personnel the biggest cost driver District-wide.

So what of the other 55 cents? Well, roughly half the budget is comprised of legally-mandated expenses, such as charter school payments and special education costs. Most glaringly, owing to decades of fiscal mismanagement, in which the District continually borrowed money without the tax base to pay it back, nearly 10 percent of the budget is reserved for paying off the debt. (This is why the District’s bonds are now rated near junk status.) That’s projected to total $260 million this year. According to, that’s more than the costs of transportation, utilities and food—combined. If not for the debt, the District would have the funds to hire roughly 1,000 more teachers and provide each student with an iPad.

How come nobody talks about this? At the height of the Great Recession, a whole host of banks were deemed too big to fail. How about considering the Philadelphia School District too important to fail? After all, banks restructure loans all the time. Why not restructure the debt currently choking the District—threatening bankruptcy, if need be—in exchange for real reform commitments?

“I looked into that,” School Reform Commission Chairman Bill Green said when I put this notion to him. “The state couldn’t declare bankruptcy in Philadelphia because it would put all state bonds in jeopardy.”

Well, okay. Does that mean we should discuss returning the schools to local control so we can declare bankruptcy and reorganize—using Detroit’s forthcoming renaissance as a model? It’s complicated. In the Inquirer, former schools’ interim CEO Phil Goldsmith persuasively argued that electing a local school board would have dire consequences. (If you like City Council, you’re gonna love an elected school board.) But maybe you appoint one? At the very least, the idea should be part of a public discussion.

The fact is, as a recently released Pew report illustrates, our school woes are deeply complicated. In the 2013-14 school year, Philadelphia spent $12,500 per pupil, less than that of comparable cities Boston, Milwaukee, Cleveland, New York, Baltimore, Chicago and Detroit, but right about at the national average. The Pew report concedes that equal funding does not necessarily guarantee the same outcome. Camden, by virtue of court order, spends more than $25,000 per pupil—and the results there don’t differ much from ours.

“Money does not necessarily correlate with student achievement,” Michelle Rhee, the former D.C. Public Schools Chancellor, said a few years ago. “In this country in the last 30 years, we have more than doubled the amount of money we are spending per child, and the results have gotten worse, not better.”

Ever since Rhee allowed a documentary crew to film her actually firing one of her teachers I’ve been lukewarm on her, but the data suggests she has a point. In the latest Programme for Individual Student Assessment (PISA) report, which tests 15-year-olds worldwide, the United States ranked 36th out of 65 countries in math. Vietnam and Canada both kicked our ass—and both spent far less than us to do it.

If not for the $260 million debt, the District would have the funds to hire roughly 1,500 more teachers and provide each student with an iPad.

I’m not arguing for disinvestment—I’m simply saying that maybe smarter spending is in order. Veteran education policymaker Marc S. Tucker recently told Joe Nocera of the New York Times that countries like Finland that have far surpassed the U.S. academically aren’t “spending more money; they are spending money differently.” They’re investing in teacher training in a way we don’t, purposefully treating teaching as a profession akin to law or medicine here—thereby attracting top students into the field.

The Pew report unearths a number of inconvenient facts. Yes, Pennsylvania is shamefully one of only three states nationwide that doesn’t use a comprehensive school funding formula that would take need and demographics into account when allocating state aid to schools; but Pew also finds that, in other states, such a formula has not necessarily provided a higher level of state aid to big-city districts. Equally troubling: at a time when many of us have been howling for more state funding, the District has actually been more reliant on state aid — 46 percent of its operational revenue came from the state in 2013-14 — than most of our ten most comparable cities.

Contrary to the familiar school funding debate that has dominated Philadelphia for far too long, maybe it’s not all about the money. After all, for years now, we’ve been looking to be bailed out by Harrisburg. How’s that working out? It’s time to talk about fixing our own financial house and figure out a way to get out from under our mandated costs. Just imagine having a competently-managed District that—as exists in Finland—has the freedom to make smart investments with the money it does have. Why can’t $2.6 billion buy that kind of thinking?

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