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New formula marks a turning point for state funding

Advocates are applauding the Pa. budget, which boosts funds for Philly and other districts with the greatest needs.

This article was originally published in The Notebook. In August 2020, The Notebook became Chalkbeat Philadelphia.

Philadelphia and other financially struggling school districts across the state were buoyed by the state budget finalized in July, which for the first time since 1992 introduces a needs-based formula for funding public schools.

After a long, vigorous grassroots lobbying campaign, advocates for adequate and equitable school funding say they have finally won a state education budget they can cheer about.

Gov. Rendell, who pushed hard for the funding formula, called the package the largest increase in basic education funding in two decades. In Philadelphia, the District got a substantial infusion of $85 million in new state funds. This was exactly the amount officials were counting on from the state to help it dig out from the budget hole it has faced since a “surprise” deficit was revealed two years ago. As a result, the extra funds will be fully absorbed by costs of existing programs.

But local advocates emphasized that the governor and legislature have made a historic, multi-year commitment to shoring up the support for underfunded school districts across the state.

“Pennsylvania is no longer one of only a handful of states in the nation to operate without a rational, longterm plan for providing resources to public schools,” said Baruch Kintisch of the Education Law Center, one of the many organizations that advocated for the new formula.

In the meantime, it’s going to be a tough year financially for the School District, which is carrying forward an estimated $30 million deficit but is committed to end the school year without one.

According to new Chief Business Officer Michael Masch, the task for the District is clear: “spend less money.”

While the elements of a plan for eliminating the deficit by next June are mostly in place, Masch said the District budget adopted last May for 2008-09 underestimated how high energy costs would skyrocket.

“We’re worried about gas in the tank, about heating and lighting the buildings, and because we run this huge food service, we’re worried about escalating food prices,” Masch said.

To compensate, Masch said there are some areas where the District can expect to achieve budget savings based on actual spending patterns in recent years. The District will also look to save money by improving efficiency and cutting staff, especially on the business side, Masch said.

While the state funding increase was long planned for and the funds already committed, the District did garner some discretionary funds: a large infusion of Title I funding from the federal government for services to students in poverty – $30 million more than anticipated.

One developing component of the budget picture is the cost of contract agreements with the District’s five major unions.

But there is some optimism about the long-term fiscal outlook.

Janis Risch, director of the advocacy group Good Schools Pennsylvania, said that if the legislature maintains its commitment to the new funding approach, it “will ensure that schools have the appropriate level of resources they need to provide a high-quality education for every student in every community around the commonwealth.”

She said advocates would be working to ensure that the funding formula is preserved and that new money is used in ways that improve student performance.

The new formula restores a direct relationship between the amount of funding awarded to each district and actual student enrollment, a link which had been broken when the previous formula was abandoned in 1992. In addition to distributing aid on a per-pupil basis, the formula factors in variables including numbers of students in poverty, numbers of English language learners, overall district size, and enrollment trends.

Pennsylvania’s new system should result in the state picking up a higher share of overall school spending, relieving the burden on local districts. The state share had been at 36 percent, one of the lowest rates of any state in the nation and well below the national average of 50 percent.

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