Category Archives: School Budget

Confessions of an Educational Hit Man

by Ray Guzman

The assault under way in Philadelphia is a textbook example of government and corporate interests superseding the rights of citizens and workers. 

In 2004 John Perkins, a former chief economist at a Boston based consulting firm, wrote a contentious mea culpa titled Confessions Of An Economic Hit Man. If you are unfamiliar with this moniker, I’ll paraphrase a definition offered by Mr. Perkins, “an economic hit man is a generic term for a private agent carrying out government and corporate interests in public spheres”. The publication of his murderous memoir offered many Americans whom may have never lived abroad a perspective into shady tactics. Mr. Perkins describes his salacious services with the carefree pace of a dying man. His tactics targeted foreign leaders. They ranged from enticing presidents with earthly vices to threats of hellish violence. Perkins’ book reveals the extreme, if not criminal duress he and his ilk levied upon these leaders. Confessions Of An Economic Hit Man forces Americans who have lived abroad to reflect on events we may have experienced. In addition, for many of us who are educators as well, we should cogently overlap these experiences with the tactics being unleashed upon public education in the United States. Our reflections, then, must lead us to surmise that there are educational hit men/women among us. I am convinced that another timely murderous memoir needs to be written by a repented “leading education reformer” with perhaps the working title of -Confessions Of An Educational Hit Man/Woman.

I lived in the Dominican Republic during the 1990s. Dr. Joaquín Balaguer, a wily, octogenarian remnant of the Trujillo dictatorship and not of my liking, governed the country. Nonetheless, an interesting episode transpired which has always held my interest. The International Monetary Fund and Mr. Balaguer were embattled in “prolonged negotiations” pursuant to a structural adjustment agreement. The crux of the impasse circled around two key issues demanded by the IMF in their proposed structural adjustment agreement -austerity, and privatization measures. Our ambassador echoed the IMF’s demands that the Dominican government ensure budget cuts and guarantee the privatization of publicly owned sectors in particular, the electrical system. Until that time I had neither heard of austerity nor privatization. Albeit as a naïve American living abroad, I became very interested in the odd, meddling insistence of our American ambassador in the economic affairs of a sovereign country. One would think that such an affront would foster national opposition. –Not quite. A strange coalition of self described liberals, impresarios, and popular opposition leaders lead mobilizations urging Mr. Balaguer to acquiesce. In summary, the delay tactics ceased, and once the agreement was signed, killer cuts left the most vulnerable, completely vulnerable. Dozens died in the protests that followed. I will offer an example as credence to the debacle that ensued. Implementation of the IMF’s structural adjustment agreement, allowed Enron Corp. to become a key looting figure in the privatization of the Dominican electrical system.

Mr. Perkins continues to detail his early beginnings at the Boston based Charles T. Main Inc. He describes the courting and vetting process conducted by corporations via private strategic-consulting firms and their billionaire backers. He enumerates his ever escalating assignments which eventually lead him to a spiritual crisis. In essence, as an economist he was charged with “convincing” elected foreign politicians to accept usury loans, which would then be coupled with repayment guarantees such as killer austerity cuts and privatization measures. Most leaders he “consulted” would accept these terms –for a price. Yet, a patriotic few resisted and would die in plane crashes. Mr. Perkins admits that his personal relationship with the incorruptible Ecuadorian president, Jaime Roldós Aguilera, and his subsequent “accidental death” lead him to renounce his cancerous career and begin confessing his misdeeds in writing.

Akin to Mr. Perkins’ experience, current education reformers are initially courted and vetted by similar corporations via private foundations or billionaire backers. Next, they are invited to attend non accredited institutes funded by the same foundations. They study the rigors of reform and the construction of choice. Upon graduation, they profess the need for REFORM above all policies. By reform they mean fewer rights for workers, namely teachers’ unions. By choice, they mean the expansion of charter schools and vouchers redeemable at private and religious schools. The main distinguishing commonality these economic and educational hit men/women share is their contempt for democracy. These individuals never participate in any election. Yet, they insist on imposing their agendas into public arenas. Ultimately, they adhere to an assassin’s ethos. They view the completion of an assigned mission as supreme. Under this ethic, the mission must be accomplished regardless of formalities or victims.

American educators need to wake up and face this unsettling fact, -hit men tactics have returned home to roost and -of all places– in our public school districts. Here in Philadelphia, both school budgets and the teachers’ union are under ferocious attack. To ensure implementation, Philadelphia has been assigned by -elected officeholders- a committee of educational hit men/women. The non-elected School Reform Commission has been trying to “convince” the teachers’ union to accept structural austerity measures in order to solve the current deficit via 13% salary cuts, loss of seniority rights, higher contributions to health plans and most disturbing of all reduction of staff. They have “consulted” with the teachers’ union. Cynically, they seem surprised by our resistance and voice their frustration to the media. They speak with pained tones, as if they are the ones under duress. And shamelessly, too many in the media continue to promote their sardonic diatribes.

This cowardly, long distance drone assault is being guided directly from Harrisburg. The governor held the disbursement of allotted funds desperately needed to properly staff our schools. He insisted that teachers swallow his hemlock spiked quid pro quo in order to release the funds. One would think that such an affront would provoke Philadelphians’ pride into action and garner a wide coalition against this farce. –Not quite. A stranger still coalition of “non-profits”, impresarios, and elected officeholders has demanded that the Philadelphia Federation of Teachers acquiesce and accept terms immediately. Incidentally, don’t bother looking for neither wily, old men nor self described liberals, and much less popular opposition leaders to come to our aid. Teachers must lead this fight.

It is imperative to note that the fiduciary responsibility of the school district has been under the control of these same non-elected, state and city appointed, private agents for the past thirteen years. In effect, they have allowed a 304 million dollar deficit to balloon and hamstring the school district, while assessing counterfactual blame to teachers for their mismanagement and political chicanery. Interestingly enough, another Boston based firm appears in our negotiations. The current master plan being followed in Philadelphia has been attributed to the Boston Consulting Group. Yes, the same one where a young Mitt Romney cut his fangs.

These killer austerity measures have already traumatized our students. Many of our schools do not have nurses, nor counselors, and scant material support necessary to provide an efficient education. Tragically, these austerity measures may have already contributed to the death of a student. On September 25th Laporcha Massey, a sixth grader at Bryant Elementary School in West Philadelphia, had an asthma attack while in school. Bryant is assigned a nurse only twice a week. September 25th was not one of them. Hence, there was no one medically certified to assist Laporcha. Although the school called her parents and apparently were unsuccessful to speak to them, they also apparently failed to call 911 to avail further certified assistance for the child. An aide drove the child to her house. Once the father picked up his daughter, he took her to Children’s Hospital, then hours into her attack. Despite efforts, tragically, Laporcha died later that night. This outrageous incident highlights the urgency of proper staffing levels at schools in particular at the elementary level. We should also keep present that Laporcha’s classmates have had to return to the same classroom since her death, and ponder her empty seat. One may ask, -does the school have certified counselors available to assist Laporcha’s classmates and dare I add, her teachers as well?

Despite endless attacks on public education, none of these reformist charlatans has come close to offering a confession. At least none has been made in any forum, and much less published. Nonetheless, I would like to believe that these hit men/women are not devoid of a conscience. I hope that they examine their actions. Moreover, I am almost certain that similar to Mr. Perkins some education reformers must be spiritually haunted by the transgressions they have carried out or continue to conduct. They must know that they are guns for hire. I truly hope they find the need for renunciation at some point in their petty lives. A life of endless assignments bent on deconstruction, roaming from one public school district to another with neither connection nor consideration to either pride or place. It is a Dantesque existence free of both, levity or divinity. Think of the pathetic “specialist” Ryan Bingham, portrayed by George Clooney, in the movie Up In Air. Clooney’s character roams the country in swift “fly by hits” for his clients. Ryan Bingham’s sole purpose in life is to fire people –for a price.

The assault under way in Philadelphia is a textbook example of government and corporate interests superseding the rights of citizens and workers. A brave whistleblower or repented technocrat is well overdue. I especially pray that a remorseful, leading education reformer may soon confess his/her misdeeds in writing. And if his/her mea culpa is sincere, I hope that all possible mercy be bestowed upon them.

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Will Pensions Sink the Philadelphia School District?

by Christopher Paslay

Retirement costs in Philadelphia will increase fivefold in the next seven years, growing from $73 million in 2011 to $349 million by 2020. 

There’s a hole in the bucket, dear Liza, dear Liza,


There’s a hole in the bucket, dear Liza, 


There’s a hole.

These lyrics, from a traditional children’s folk song that I first heard as a child on Sesame Street, played through my head this week as I thought about the crisis facing the Philadelphia School District.

We have a hole.  A giant hole.  Not just in terms of cash, but also in terms of resources, staff, and services.  Earlier this year, the District laid-off nearly 3,800 workers.  As reported by the Notebook in June:

The 3,783 figure includes 676 teachers, 307 secretaries, 283 counselors, 127 assistant principals, 1,202 noontime aides, and 769 supportive services assistants, in addition to smaller numbers of workers in other categories. . . . The School Reform Commission adopted a “doomsday” budget . . . that provides a principal and a core group of classroom teachers for each school and nothing else. It has already said it will lay off all counselors, librarians, art and music teachers, secretaries, and support personnel, including noontime aides, in the schools.

Although about a third of the staff was rehired at the end of August, the fact that the District could do so little with so much money is concerning.

Consider these facts: The Philadelphia School District’s budget for the 2008-09 school year was approximately $2.7 billion.  The current budget for the 2013-14 school year is approximately $2.7 billion, although the district may still fall short $100 million plus, depending on the outcome of the negotiations between the School Reform Commission and the Philadelphia Federation of Teachers.

The question here is how was the District able to run at full strength with $2.7 billion just four short years ago, and be in such dire straights now?

The answer may very well rest with retirement costs, which continue to go up at an alarming rate.  According to the Pennsylvania Independent:

Payments to retired teachers and public employees are a growing threat to government budgets everywhere, and it is no different in Philadelphia. A new report from the Thomas Fordham Institute, a conservative education nonprofit, estimates the district’s total retirement costs will balloon from $73 million in 2011 to $349 million by 2020.

On a per-pupil basis, that works out to $900 per pupil in the district for 2011, growing to $2,300 per pupil by 2020.

Robert Costrell, a professor of economics at the University of Arkansas and an author of the report, says that trend is unsustainable.

“We’ve only just begun to see how bad it is going to be,” Costrell said Thursday.

The report examines the pension costs of the Philadelphia School District. Costrell said the financial mess unfolding in Pennsylvania’s largest city is on par with what has been seen recently in Detroit and Chicago. . . .

Because pension costs for public school employees are split between the local and state level in Pennsylvania, the situation in Philadelphia is partially a symptom of the $30 billion unfunded liability in the state’s Public School Employees Retirement System, or PSERS.

Because of that split, the state now picks up about $450 of that $900-per-pupil price tag, but as the costs rise, it will hurt both the district’s and the state’s bottom line.

And when the district spends about $15,000 per pupil — but will soon have to spend $2,000 per pupil on payments to retired district workers — that means fewer dollars are available to cover the actual costs of education.

Lawmakers in Harrisburg must solve the crisis because the state runs the pension system. Little progress has been made toward that goal.

Changes to the pension system approved in 2010 affected only future hires, which does little to affect the pension obligations in the short-term, the report notes.

Since most of the cost growth in the next decade is due to deferred payments of benefits owed to current workers or those who are already retired, changing benefit structure for new employees has little effect, Costrell said.

This news is indeed troubling.  As education advocates continue to fight for more funding for city schools—at both the state and local levels—the looming crisis involving pension funding hangs above it all.  State funds allocated by Gov. Corbett already make-up 50 percent of the Philadelphia School District’s budget—about $1.3 billion annually—and as pension obligations increase, this may very well cut into money earmarked for education.

Something has got to give, and sacrifices will need to be made.  Educators undoubtedly want the best for their students.  At the same time, after contributing 7.5  – 10.3 percent of every check to PSERS (Public School Employees Retirement System), they don’t want to see their pension funds go up in smoke.

Which leads to the following question: Will pension reform take place before the District goes bust?

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Are Philly Schools Headed the Way of Detroit?

detroit

by Christopher Paslay

It’s going to take more than a “fair state-funding formula” to save Philly schools.  

Tonight at 6:00 pm at the Licacouras Center, the Philadelphia Federation of Teachers will learn important updates on the current contract negotiations with the Philadelphia School District and decide what steps to take next.  PFT President Jerry Jordan has already proposed having teachers pay more for their health benefits, in addition to taking a pay freeze for one year.  The School District, however, wants more.  The School Reform Commission is asking for teachers to take pay cuts up to 13% percent for five years, among other things.

The Obama administration provided $45 million in debt forgiveness to Pennsylvania, and both sides are counting on Governor Corbett, who is holding the money hostage as a way to get the PFT to agree to pay cuts, to eventually release the cash to the School District.

The PFT may agree to pay cuts, or they may not.  Corbett may give the $45 million to Philly schools, or he may not.  In the long run, none of this will keep the Philadelphia School District from collapsing under it’s own weight; tragically, it appears that the PSD is heading the way of Detroit.

Pulitzer Prize winning Washington Post columnist Charles Krauthammer writes:

If there’s an iron rule in economics, it is Stein’s Law (named after Herb, former chairman of the Council of Economic Advisers): “If something cannot go on forever, it will stop.”

Detroit, for example, no longer can go on borrowing, spending, raising taxes and dangerously cutting such essential services as street lighting and police protection. So it stops. It goes bust.

Cause of death?  Corruption, both legal and illegal, plus a classic case of reactionary liberalism in which the governing Democrats — there’s been no Republican mayor in half a century — simply refused to adapt to the straitened economic circumstances that followed the post-World War II auto boom.

Corruption of the criminal sort was legendary. The former mayor currently serving time engaged in a breathtaking range of fraud, extortion and racketeering. And he didn’t act alone. The legal corruption was the cozy symbiosis of Democratic politicians and powerful unions, especially the public-sector unions that gave money to elect the politicians who negotiated their contracts — with wildly unsustainable health and pension benefits.

When our great industrial competitors were digging out from the rubble of World War II, Detroit’s automakers ruled the world. Their imagined sense of inherent superiority bred complacency. Management grew increasingly bureaucratic and inflexible. Unions felt entitled to the extraordinary wages, benefits and work rules they’d bargained for in the fat years. In time, they all found themselves being overtaken by more efficient, more adaptable, more hungry foreign producers.

The market ultimately forced the car companies into reform, restructuring, the occasional bankruptcy and eventual recovery. The city of Detroit, however, lacking market constraints, just kept overspending — $100 million annually since 2008. The city now has about $19 billion in obligations it has no chance of meeting. So much city revenue had to be diverted to creditors and pensioners there was practically nothing left to run the city. Forty percent of the streetlights don’t work, two-thirds of the parks are closed and emergency police response time averages nearly an hour — if it ever comes at all.

Sound familiar?  Here are some similarities between The Philadelphia School District and Detroit:

Corruption

Philadelphia has been governed by Democrats for half a century—there hasn’t been a Republican mayor in over 60 years.  Corruption of the criminal sort has also been legendary.  In 2007 Vince Fumo, a Democrat who represented a South Philadelphia district in the Pennsylvania Senate from 1978 to 2008, was the subject of a Federal grand jury that named Fumo in a 137 count indictment, including the misuse of $1 million of state funds and $1 million from his charity for personal and campaign use; he was found guilty in 2009 of all 137 counts (ironically, Fumo just got out last month and is now living in a West Philly halfway house).

This is a common theme in Philadelphia.  According to NBC 10:

You don’t have to look far to find other Philadelphia politicians who went to prison on corruption charges and came back for a second act.

In fact, there’s a whole vocabulary about it among city pols. They’ll say somebody “had a problem” and went away. Many of the city’s 69 Democratic ward leaders used to call the federal pen at Allenwood “the 70th Ward” – kind of the way celebrities talk about rehab. It could happen to anybody.

The late state Sen. Henry “Buddy” Cianfrani came back after his prison term and worked as a political consultant and powerbroker for many years. Former City Councilman Jimmy Tayoun, always the entrepreneur, started a political newspaper, the Philadelphia Public Record, which is still going and is read by city and state pols everywhere.

Former U.S. Rep. Michael “Ozzie” Myers, who went down in the Abscam scandal, is still influential in South Philly, where his brother Matthew is a ward leader.

As for current fraud, waste, and abuse: From 2008 to 2011, the Ackerman administration spent nearly $10 billion, with little to show for it other than a detailed audit of the PSD’s financial practices by the IRS (and this doesn’t include the usual antics from the usual suspects, such as Chaka Fattah jr., etc.).

Pensions

Although Philadelphia schoolteachers are not paid nearly as well as their suburban counterparts (we face harsher working conditions, have less resources, and spend thousands of dollars of our own money), funding teacher pensions has become a legitimate concern.  Unfortunately, the baby-boomers who were once contributing to the system are now taking from it, and this has called into question the sustainability of the entire system, prompting many of my generation to ask the question: will our pensions be around in 20 years when we retire?

Deteriorating Resources

It is true that Philadelphia public schools are looking eerily like the city of Detroit.  Instead of nonworking streetlights they are nonworking computers and heating units; instead of closed parks there are closed schools; and instead of long response times from police and fire fighters, there are long response times from counselors, school security, and nurses—because they are woefully lacking.

Tax, Borrow, Spend

Like Detroit, Philadelphia continues to borrow, spend, and raise taxes.

As reported in March of 2012 by phillymag.com:

Counting the previous increases in the parking tax, hotel tax, sales tax and property tax, Nutter is on course to raise taxes all five years he has been in office. . . . Nutter is on course for a tax-hiking legacy unmatched since Mayor Rizzo’s fiscal insanity drove the city to the brink of bankruptcy.

In a city that already had one of the highest overall tax burdens in the country, five years of additional tax hikes could take a generation to undo. The result is an even more uncompetitive city.

Last year alone, the city borrowed $300 million to run the schools, and still faces a $1.1 billion budget deficit over the next five years.

Solution?

Tragically, the Philadelphia establishment continues to turn a blind eye to this situation, and continues to blame Governor Corbett, who’s been in office less than three years, for the mess they find themselves in.  Sure, Corbett’s funding formula has put Philadelphia in a pinch financially (although he’s given Philly Schools nearly $1.3 billion in funds this year alone), but fixing this formula is only a small part of stabilizing the PSD as a whole.

What Philadelphia needs is a paradigm shift—a total change in attitude and culture.  At the core of this is the need for everyone—parents, students, teachers, administrators, etc.—to go from passengers to drivers.  We need to stop being victims and start being captains of our own ships.

How do we do this?  Stop being sheep.  Stop groupthink and continuing to vote for the status quo.  Embrace individual achievement over stagnating collectivism.  Parent your children (that means you, fathers).  Pay your property taxes.  Get involved in your children’s educations.  Hold one another accountable.  Meet deadlines.  Speak out against corruption (yes, blow the whistle and snitch!)  Show up for work, on time.  Enforce current policy—gun laws, student discipline, truancy, etc.—before enacting new, unenforceable (dog and pony show) regulations.  Give no more than a second chance to anyone.

Nothing is free.  There is no perpetual motion machine.  Debts and deficits, at the local as well as the federal level, are real and mean something.  The fantasy that there exists some unlimited amount of money out there in limbo that some rich, (perhaps racist), miserly politician or one-percenter is hoarding (and that we need to rally or march to extract) is just that—a fantasy.  As Philadelphians we need to work together and make do for ourselves.  We need to sacrifice, and make do.

A new state-funding formula is just the first step in saving city schools.  If we don’t change our culture, the Philadelphia School District will end up just like the Motor City.

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Dwight Evans’ Laughable Plea for School Funding

by Christopher Paslay

After dismantling public education and lining his own pockets, Dwight Evans suddenly gets a conscience.   

Dwight Evans, who represents the 203rd legislative district in Philadelphia, published a commentary in today’s Philadelphia Daily News headlined, “Deathly ill public ed needs state meds.”  My first reaction after reading it was Is Dwight Evans off his meds?

Evans’ article begins:

I’M CALLING IT the Harrisburg Syndrome: the chronic and costly practice of refusing to invest responsibly in education.

Pause the tape right there.  Since Evans is talking about the need to “invest responsibly in education,” let’s examine some of the ways Evans himself has invested in public schools.

First, there is the education legislation Dwight Evans has fought to pass—the Pennsylvania Charter School Law, which opened the floodgates for the privatization of Philadelphia’s public schools, and Acts 46 and 83, which according to the University of Pennsylvania Labor and Employment Law, “allows the Secretary of Education to declare the system in ‘distress,’ and upon making that declaration, to displace the Board of Directors of the school system and impose a five-member ‘School Reform Commission’ to take over the duties of the Board.  Additionally, the Act eliminates teachers’ right to strike, and prohibits them from negotiating a number of issues for collective bargaining purposes.”

In laymen’s terms, Evans has supported laws that have taken tens of millions of dollars away from traditional public schools and put them into privately owned charters (like Evans’ own West Oak Lane Charter); laws that enabled Harrisburg to take over the Philadelphia School District; and laws that have taken away the Philadelphia Federation of Teachers’ right to strike and to collective bargain.

Then, there are Dwight Evans’ business investments.  In 1983, Evans founded Ogontz Avenue Revitalization Corporation (OARC), which as of 2007 had an operating budget of $12 million.  According to its website, OARC takes “a holistic approach toward community revitalization, by focusing on our Five Pillars: Housing and Economic Development, Business Development, Education and Community Relations, Cleaning and Greening, and Arts and Culture.”

Within Education and Community Relations, OARC offers charter school management, with a fundamental philosophy that “Charter schools must be run as a business . . . a business that produces a product . . . that product is a highly educated student.”  OARC has also opened several charter schools of its own.  In 1998 they opened the West Oak Lane Charter School, as I mentioned above, and owns the property at 2116 E. Haines Street that houses the HOPE Charter School, the Philadelphia Center for Arts and Technology, and Ombudsman.

Since Evans founded the corporation in 1983, OARC has grown by leaps and bounds, and has made many people lots of money (including Evans himself).  Interestingly, though, OARC is technically a not-for-profit, 501 (c)(3), and enjoys tax-exempt status, which means they don’t pay federal income tax or property tax on their buildings.

Another one of Evans’ “investments” in education is his connection with Foundations, Inc., an education management organization that gets paid to both consult and run schools.  According to an article on philly.com:

State Rep. Dwight Evans and Foundations have a long history together, dating back more than 20 years.

Foundations collaborated with the lawmaker in several after-school programs in the area and helped design West Oak Lane Charter School. Between 2006 and 2008, employees from the company donated more than $25,000 to his campaigns. Among them, chief executive Rhonda Lauer donated $3,900, chief of staff Emelio Matticoli donated $3,100 and consultant Martha Young donated $5,920.

Foundations has made millions off of the Philadelphia School District.  As stated by Helen Gym on Young Philly Politics:

State Rep. Dwight Evans was a leading architect behind the state takeover of the Philadelphia Public Schools, and a company with which he has close ties, Foundations Inc., became one of the District’s first EMOs (education management organizations) as well as a major recipient of millions of dollars in school service contracts. Foundations has run Martin Luther King High School for the last eight years, taking in management fees as it ran the school. The school has not done well, to say the least, and its poor academic performance placed it on a list for “turnaround,” a national model of restructuring.

When parents of Martin Luther King’s students voted 8 – 1 to allow Mosaica Schools, Inc. to replace Foundations—Evans bragged about how he had bullied the School Reform Commission, Superintendent Ackerman, and Mosaica Schools into allowing Foundations to keep the contract to manage the school.

“I was like a bulldog on a bone,” said Evans, although Foundations was eventually forced to give up running King High School.

Amazingly, like OARC, Foundations is a not-for-profit, 501 (c)(3), and enjoys tax-exempt status.

Now, back to the ludicrous commentary Evans had in today’s Daily News.  Evans writes:

A physician would look at the condition of public education in Pennsylvania and call for broad-spectrum antibiotics in the form of money. Not just your garden-variety antibiotic, but consistent, broad-based funding – similar to what’s advancing in California – to provide for the “thorough and efficient” education system called for in our state constitution.

Broad-spectrum antibiotics in the form of money. 

I had to go back and reread that line several times to make sure it was really there.  It was.  Evans, of all people, is asking the state for more money for the Philadelphia School District.  He suggests doing so by raising—get this—income taxes:

California has ordered the antibiotic. Last November, voters approved Proposition 30, which calls for income-tax increases that will boost California’s K-12 budget by roughly $1 billion.

Evans then throws in a cherry-picked statistic about corporate net-income taxes just for good measure (and to appeal to all those class warfare lovers out there):

The Harrisburg Syndrome shows no signs of abating. The House recently signed off on cutting the corporate net-income tax to 6.99 percent from 9.99 percent. That’s right – taxpayers across the state are being hammered by local school taxes while big business gets a tax cut.

And while corporations affiliated with Dwight Evans, like OARC and Foundations, pay ZERO taxes!

Perhaps the most puzzling aspect of Evans’ commentary was that he used the state of California as an example of a public education system that works (according to Education Week, California’s K-12 schools get a “C” average and rank 31 out of 50), and that Evans refers to his new educational virus as “Harrisburg Syndrome” (it was Evans who fought to pass legislation that enabled Harrisburg to take over Philadelphia public schools to begin with).

Are Philadelphia public schools and their students in desperate need of more funding?  Absolutely.  But the School District’s budget woes are primarily a result of fraud, waste, and abuse of the Dwight Evans variety, which hardly makes the lawmaker a credible voice for calling for more school funding on the backs of the state’s hardworking taxpayers.

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Taxing Nonprofits Could Help Save Philly Schools

by Christopher Paslay

Philadelphia’s multi-billion dollar nonprofit sector must start paying its fair share. 

According to the Philadelphia Foundation’s Nonprofit Study 2010, there are over 3,500 nonprofits in Philadelphia.  In 2007 alone, they made more than $25 billion in revenue, which was 7.7 percent more than they made in 2000.  These nonprofits—which provide services that focus on the arts, the environment, animal rights, education, health, civil rights, housing, food, recreation, and the like—had nearly $47 billion in total assets in 2007.

Interestingly, these nonprofits pay no real estate tax, despite billions of dollars in assets.  For example, the Kimmel Center as of 2010 had $16,449,000 in liquid assets (cash, grants, contributions, etc.) and 267,645,000 in total assets (endowment funds, land, building and equipment, etc.), yet are exempt from paying $5 million in annual property taxes.

According to a 2007 article in the New York Times:

The Chronicle of Philanthropy surveyed 23 cities to try to determine which nonprofits that seek public support — excluding foundations, government and religious groups — receive property-tax exemptions. Such exemptions accounted for more than $1.5 billion a year, with more than half that amount forgiven in New York City and Boston. . . . In terms of value, the biggest exemptions after New York and Boston were in Los Angeles, Washington, Houston and Philadelphia. . . .

The Chronicle’s survey highlighted several well-known properties beyond hospitals that receive big property-tax breaks. These include the Getty Museum in Los Angeles, exempted from $18.4 million in property tax; the Chrysler Building in New York, owned by the Cooper Union for the Advancement of Science and Art college, an exemption worth $17.5 million; and in Philadelphia, the Kimmel Center for the Performing Arts, exempted from $5 million in annual property tax.

The Philadelphia School District is facing a $300 million budget deficit next school year.  District officials are asking everyone to make sacrifices to help close this hole, and have demanded that the Philadelphia Federation of Teachers make tens of millions of dollars in concessions via wage cuts.  Officials are also asking for an additional $120 million from the state, and $60 million from the city, some of which may come from new property taxes.

Mayor Nutter’s new real estate tax assessment—AVI (Actual Value Initiative)—has ruffled the feathers of some City Council members, however.  According to a February 28th article in the Philadelphia City Paper:

This morning, City Councilwoman Maria Quninones-Sanchez quietly and without speechifying, offered what may be a solution to one of the central problems created by the Actual Value Initiative, the city’s property-tax reform effort. The problem: An estimated $200 million of the tax burden is being shifted from large commercial properties to residential ones, while small businesses are also in many cases expecting to see their taxes skyrocket. Sanchez’s solution: Put some of that burden back onto the large commercial properties by way of the Use & Occupancy (U&O) tax, which is applied to commercial tenants, and let the city keep some of that money to use for tax relief for the rest of us.

What’s curious is that Sanchez didn’t mention the problem with Philadelphia’s 3,500 nonprofits—the fact that they bring in $25 billion in annual revenue and have nearly $47 billion in assets—but pay zilch in property tax, money that could help bail out Philadelphia’s struggling public schools.  Why should our city’s students go without counselors, nurses, sports, art, and music while mega nonprofits like the Kimmel Center are sitting on a quarter of a billion dollars in total assets and get a $5 million break in annual property taxes?

Fight for Philly, “a grassroots coalition of residents, community groups, neighborhood associations, faith organizations and labor groups,” feels mega nonprofits like the Kimmel Center should start pitching in and shouldering some of the load.  Earlier this month, they delivered tax petitions to City Council and Mayor Nutter asking for better school funding, demanding that “mega non-profits pay taxes on their profitable commercial property and contribute fair ‘good neighbor’ payments for city services from which they benefit.”

I agree with Fight for Philly—City nonprofits should no longer sit back and get a free ride.  City Councilwoman Maria Quninones-Sanchez’s new tax reform bill should also include Philadelphia’s 3,500 not-for-profits, which earn $25 billion in annual revenue.  Even a small real estate tax on these organizations could generate millions of badly needed dollars for Philadelphia’s struggling public schools.

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Obamacare Forcing Colleges to Cut Teachers’ Hours

by Christopher Paslay

To avoid penalties under the Affordable Care Act, adjunct professors at some universities will not be assigned more than an average of 29 hours per week.

Philadelphia School District officials are not the only ones facing tough economic times.  Across the country, America’s colleges and universities are struggling financially, especially now that the Affordable Care Act has gone into effect.  To avoid new requirements that they provide healthcare to anyone working over 30 hours per week, many colleges are cutting the number of hours worked by adjunct professors.

As stated in American Interest Magazine: “This is terrible news for a lot of people; 70 percent of professors work as adjuncts and many will now have to cope with a major pay cut just as requirements that they buy their own health insurance go into effect.”

According to The Wall Street Journal:

In Ohio, instructor Robert Balla faces a new cap on the number of hours he can teach at Stark State College. In a Dec. 6 letter, the North Canton school told him that “in order to avoid penalties under the Affordable Care Act…employees with part-time or adjunct status will not be assigned more than an average of 29 hours per week.”

Mr. Balla, a 41-year-old father of two, had taught seven English composition classes last semester, split between Stark State and two other area schools. This semester, his course load at Stark State is down to one instead of two as a result of the school’s new limit on hours, cutting his salary by about a total of $2,000.

Stark State’s move came as a blow to Mr. Balla, who said he earns about $40,000 a year and cannot afford health insurance.

“I think it goes against the spirit of the [health-care] law,” Mr. Balla said. “In education, we’re working for the public good, we are public employees at a public institution; we should be the first ones to uphold the law, to set the example.”

Maybe some of these adjuncts can brush-up on their accounting skills and apply to the IRS to supplement their hours.  Word has it the IRS is hiring 16,500 new agents to enforce Obamacare’s tax code.

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A Look at the Philadelphia School District’s Top Earners

by Christopher Paslay

The Philadelphia School District’s top 655 earners (less than one-third of 1 percent of employees) make a combined $88 million in annual salaries.    

According to a Phillymag.com article by Larry Mendte published last June, there were 655 individuals working for the Philadelphia School District in 2011-12 making over $100,000.  Surprisingly, there were 98 teachers on the list.  Principals, who on average make $106,046, flooded the list and accounted for five of the District’s top 10 earners.

Not included on the list are this year’s newly minted one percenters, such as Superintendent Dr. William Hite ($300,000 annual salary), Deputy Superintendent Paul Kihn ($210,000 salary), and newly appointed Chief of Family and Community Engagement Evelyn Sample-Oates ($129,162 salary); Chief Recovery Officer Thomas Knudsen who was receiving $25,000 a month in 2012 (for a grand total of nearly $300,000), did make the list although is not listed in the top 25 below because he’d only racked-up a nifty $122,988.48 when Mendte published the article last June. 

When totaling up all the 655 salaries over $100,000, it comes to $88 million.  This means one-third of 1 percent of the workers (the School District has 20,309 employees) gobble-up over 10 percent of the money (the District’s 2013 adopted operating budget allocates $879 million for salaries and wages).

Here were the top 25 earners working for the School District in 2011-12 according to the article by Mendte:

  1. Arlene Ackerman, Superintendent of Schools: $804,668.67
  2. Leroy Nunery, Special Advisor: $206,283.52
  3. Michael Davis, General Counsel: $171,247.48
  4. Penny Nixon, Chief Academic Officer: $170,096.13
  5. Michael Masch, Special Advisor: $168,840.82
  6. Debora Borges, Principal Empowerment School: $157,102.79
  7. Renee B. Musgrove, Principal Empowerment School: $151,776.93
  8. Donald j Anticoli, Principal Renaissance School: $151,161.70
  9. Edward Penn, Principal Renaissance School: $150,531.86
  10. Ethelyn Payne Young, Principal Renaissance School: $150,319.66
  11. John W. Frangipani, Principal Empowerment School: $149,645.96
  12. Otis Hackney, Principal Renaissance School: $149,147.04
  13. Charles Staniskis, Principal Empowerment Schools: $147,765.82
  14. Thomas Koger, Principal Non High Needs School: $147,687.99
  15. Mary Dean, Principal Renaissance School: $147,529.67
  16. Michelle Byruch, Principal Non-High Needs: $147,049.39
  17. Christophe Johnson, Principal Renaissance School: $146,809.37
  18. Amish Shah, Teacher: $145,743.55
  19. Woolworth Davis, Principal Renaissance School: $145,652.42
  20. Karen Kolsky, Assistant Superintendent: $145,423.45
  21. Lissa S. Johnson, Assistant Superintendent: $145,423.45
  22. Benjamin Wright, Assistant Superintendent: $145,333.45
  23. Francisco D. Duran, Assistant Superintendent: $145,333.45
  24. Linda Cliatt Wayman, Assistant Superintendent: $145,333.45
  25. Emmanuel Caulk, Assistant Superintendent: $145,333.45

On the opposite end of the spectrum are the 2,700 workers represented by SEIU 32BJ Local 1201, who provide cleaning, maintenance, and transportation services to the School District.  Nearly all of these workers make less than $40,000 annually—some as little as $25,000 a year.  The School District recently shook-down these hardworking blue-collar folks for an estimated $100 million in labor concessions over the next four years.

According to the new contract between the Philadelphia School District and SEIU 32BJ, which extends to August 31st, 2016, SEIU 32BJ members will contribute between $5 and $45 (depending on salary) to the School District each week, and agree to forgo planned wage increases in the future and freeze wages for the life of the contract.

This, of course, didn’t stop the School District from recently giving 25 non-union workers $311,351 in increases, which average $12,454 per year.  31-year old Christina Ward was given a 17 percent raise and promoted to Deputy Chief Financial Officer, and will earn $138,420 a year. Joseph D’Alessandro, now the Chief of Grants Development and Compliance, was given an $18,000 raise (16 percent) and currently makes $130,270.  And newly appointed Chief of Family and Community Engagement Evelyn Sample-Oates, who earns $129,162, was given a whopping 49 percent salary increase.

How will the School District cover the pay raises?  No one knows.  Not even the $100 million in labor concession squeezed from the District’s janitors and bus drivers will cover the tab.  According to projections in Dr. William Hite’s Action Plan v1.0, “The District has recurring expenses that exceed its revenues by over $250 million per year, amounting to a $1.35 billion dollar deficit over the next five years.”

And I thought only big corporations and greedy Republicans maintained wage gaps and pimped the working class.

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Teachers Unions Need a Realistic Plan to Brace for Tough Times Ahead

By Christopher Paslay

Randi Weingarten’s latest message to AFT members avoids dealing with America’s harsh fiscal reality.     

During Arlene Ackerman’s tenure—from July of 2008 to July of 2011—the Philadelphia School District spent nearly $10 billion.  As hundreds of millions of dollars in federal stimulus were going God knows where, those in the Philadelphia education community with a shred of common sense knew that when the money dried up, the School District was in big trouble.  Instead of practicing austerity by prioritizing needs, Ackerman and her crew spent, spent, spent—which eventually led to the biggest budget deficit in Philadelphia School District history—a hole over $700 million deep (a hole that the District is still borrowing to climb out of).

What many in the Philadelphia education community may not realize, however, is that the financial woes of the School District are small potatoes compared to what is brewing at the core of the Budget of the United States Government.  Sure, most are aware there is a budget deficit as well as a growing national debt, but most don’t realize just how drastic the situation is and few comprehend the actual compromises that will be needed to begin to stabilize the situation.

AFT President Randi Weingarten’s latest article in American Teacher Magazine is a case in point.  Headlined, “We need a fiscal plan that safeguards priorities,” the piece calls for union members across the country to send a message to Congress to find a “fair-and-balanced” deficit-reduction plan that would stop America from going off the fiscal cliff; if Congress doesn’t reach an agreement by the end of the year, the Bush tax cuts will expire and devastating across-the-board cuts will go into effect.  Weingarten writes:

That’s why the AFT has called upon members from across the country to tell Congress to work together and agree on a fair and balanced deficit-reduction plan that safeguards vital priorities and includes revenue increases, such as requiring corporations and the richest 2 percent of Americans to pay their fair share of taxes.  This would provide needed revenues to ensure essential programs like Social Security, Medicare, Medicaid, and aid to states and localities for public education will not be slashed.

For the record, I agree with Weingarten.  Vital public education programs need funding (such as Title I grants and Head Start), and Social Security, Medicare and Medicaid need funds as well.  Here’s the problem with Weingarten’s message, however: 1—it’s based on a fantasy; and 2—it’s dangerously vague.

First, the fantasy part.  Raising taxes on the richest 2 percent by allowing the Bush tax cuts to end for those making over $250,000 a year (their tax rate would go from 35 percent to 39.6 percent) would only generate a measly $70 billion a year.  This may seem like a lot of money until you realize that the U.S. government spends more than $10 billion a day.  Loose translation: this is only enough money to run the government for seven days.

When Weingarten states that making the rich pay more “would provide needed revenues to ensure essential programs like Social Security, Medicare, Medicaid, and aid to states and localities for public education will not be slashed,” she is simply purporting an economic myth; Medicare and Medicaid together cost $1 trillion annually.  This is not to say that the taxes of the very rich shouldn’t go from 35 percent to 39.6 percent, as President Obama wants.  But the idea that simply taxing the rich is going to save public education and health care is ridiculous (and dangerous—but I’ll get to that part in a moment).

Raising taxes on the rich is only a drop in the bucket; the fiscal crisis cannot be remedied without very real spending cuts.  There is this fantastic idea harbored by idealistic education advocates that the U.S. is the land of plenty, one of the richest nations on earth, and that there is more than enough money to go around—if only we could get those greedy wealthy corporate types and the like to pay their fair share.  This isn’t exactly true, either.  Consider these facts using 2009 data from the IRS:

  • 8,274 people filed tax returns with incomes over $10 million, which totaled $240.1 billion in income.  If the government took 100 percent of their money—not the 39.6 percent that the President wants—it would only cover 24 days of federal spending.
  • 236,883 people filed tax returns with incomes over $1 million, which totaled $726.91 billion in income.  If the government took 100 percent of their money, it would only cover 72 days of federal spending.
  • 3,924,490 people filed tax returns with incomes over $200K, which totaled $1.964 trillion in income.  If the government took 100 percent of their money, it would only cover about six months of federal spending.
  • 17,446,537 people filed tax returns with incomes over $100,000, which totaled $3.765 trillion in income.  If the government took 100 percent of their money, they would still be $30 billion short of 2012 spending, which comes in at $3.796 trillion.

The notion that simply making the rich “pay their fair share” will save Title I grants, Head Start, Social Security, Medicare and Medicaid is, as I mentioned earlier, pure fantasy.  The reality of the situation is that things will need to be cut (think of the past two years in the Philadelphia School District for those who still don’t get the picture).  Loose translation: crazy spending eventually catches up with you.

Which brings me to my second point: Weingarten’s message to AFT members is dangerously vague.  Vague in terms of specifics on what the AFT is willing to compromise.  Yes, I said the forbidden word: compromise.  I know what old school union folk are thinking: Off with his head!  But it doesn’t matter whether I say the word or not, because it’s coming and there’s nothing that can be done about it.  Whether the rich pay more or not, real spending cuts are coming.  The only question is when.

If the president gets his way and Congress agrees to once again raise the debt ceiling (maybe to 18.5 trillion), then the big cuts won’t happen for another few years.  They’ll probably (and conveniently) happen after 2016, but when they do, look out (think the Philadelphia School District fiscal crisis on a grand scale).  Which is why the AFT should be bracing now for the coming craziness.  Weingarten should be honest with AFT members: Taxing the rich sounds great and makes us feel good, but it’s not going to save us.  What are our priorities, our real priorities?  What do we absolutely need, and what are we willing to negotiate?  We can’t pretend this away anymore.  Here are the numbers, and here is the situation.

The AFT (as well as President Obama) should start seriously figuring out what’s going on the chopping block so all of us can honestly start preparing for the inevitable.

As writers say in the world of books when a publisher demands that words be cut from a manuscript in order to make space:  Better that I do the surgery myself than let some crazy editor decide.

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Pedro Ramos is not Scott Walker, and Pennsylvania is not Wisconsin

by Christopher Paslay

SRC Chairman Pedro Ramos may be emboldened by Scott Walker’s recent victory over Big Labor, but the Keystone State is a far cry from the Badger State.       

It appears that Philadelphia School Reform Commission chairman Pedro Ramos is suffering from Scott Walker Syndrome.  His recent attempt to push legislation that would extend the SRC’s power to nullify union contracts and unilaterally dictate salary and benefits to School District employees is curiously timed.  You’d almost think Ramos has become emboldened by Wisconsin governor Scott Walker’s Assembly Bill 11, also known as his “Budget Repair Bill,” which limits collective bargaining by public-sector unions, caps salary increases, and forces workers to pay more for their pensions and health benefits.

Members of the Philadelphia Democratic House delegation, however, do not seem to be as enamored by Scott Walker’s recent victory over Big Labor.  Walker may have survived Tuesday’s recall election, but this hasn’t inspired Pennsylvania state legislators to get on board with the SRC’s surprise legislative amendment that would further cripple School District unions and their bargaining power.

Although Pennsylvania’s Act 46 already strips the Philadelphia Federation of Teachers of their right to strike—giving the SRC the power to unilaterally impose contact terms and limit collective bargaining—Ramos feels he needs even more power.

According to Kristen Graham’s 6/8/12 Inquirer story:

State Rep. Michael H. O’Brien (D., Phila.), who was at the meeting, said Ramos admitted the SRC was attempting to sell a legislative amendment Ramos needed because current law “didn’t give the SRC enough juice,” in O’Brien’s words.

The SRC’s new ploy for more power was apparently an unpleasant surprise for many, including Mayor Nutter and members of the Philadelphia Democratic House delegation.

Someone, perhaps Nutter himself, needs to tell Pedro Ramos that he’s not Scott Walker.  And while he’s at it, he needs to explain to the SRC that Pennsylvania (and for the purposes of this argument, Philadelphia) is not Wisconsin.  For starters, Pennsylvania has a balanced budget (although the Philadelphia School District is still facing a deficit, but this deficit was created by the SRC itself).  Second, Pennsylvania’s Public School Employees’ Retirement System was just overhauled in 2010, cutting pension benefits and increasing member contributions.  Third, collective bargaining by the largest teachers’ union in the state—the Philadelphia Federation of Teachers—has already been severely limited for over a decade by the passing of Act 46.

Here’s a comparison between Pennsylvania and Wisconsin on three hot button issues: collective bargaining rights; retirement; and health insurance.

Collective Bargaining

Massive protests broke out in Wisconsin last year when Governor Scott Walker passed his Budget Repair Bill, which limited the collective bargaining power of public-sector unions.  According to the Greenbay Press Gazette:

The bill would make various changes to limit collective bargaining for most public employees to wages. Total wage increases could not exceed a cap based on the consumer price index (CPI) unless approved by referendum.

Contracts would be limited to one year and wages would be frozen until the new contract is settled. Collective bargaining units are required to take annual votes to maintain certification as a union.

Employers would be prohibited from collecting union dues and members of collective bargaining units would not be required to pay dues. These changes take effect upon the expiration of existing contracts.

But when you compare this to the restrictions imposed on the largest teachers union in Pennsylvania by the passing of Act 46 over a decade ago, it is relatively small potatoes.  According to an article in the University of Penn’s Journal of Labor and Employment Law:

The state takeover of Philadelphia city schools will obviously have an effect on Philadelphia teachers’ ability to bargain collectively for contract rights. . . . While the system is under the control of the SRC, teachers are prohibited from striking in order to secure contract rights. . . . For example, teachers could be faced with a significantly lengthened school year, less preparation time, and larger classes, all without the opportunity to bargain for any compensation for these impositions. . . . Also, the district would not be required to discuss “decisions related to reduction in force.” This allowance for the district, coupled with the fact that, under Act 86, the SRC may make decisions to suspend professional employees without regard to tenure protection has potentially dire consequences for the professional security of educators. In a situation involving layoffs, for instance, teachers who have years of experience could be suspended before new hires.

In effect, under Act 46, the SRC already has the power to unilaterally impose contract terms, overhaul traditional schools and turn them into charters, lengthen the school day and year without compensating workers, layoff teachers regardless of seniority or tenure, and takes away the union’s right to strike, among other things.

As for union dues: Philadelphia public school teachers can opt out of joining the union, but they are still required by the state to pay something called “Fair Share,” which basically means that they have to pay union dues anyway, which is about 1 percent of their salary.

Pensions and Retirement

Until Scott Walker passed his Budget Repair Bill, state, school district, and municipal employees in Wisconsin paid little to nothing for their pensions.  Now members of the Wisconsin Retirement System must contribute 50 percent of the annual pension payment, which means public school teachers have to start contributing about 5.8 percent of every check toward their pensions.

Since 2001, Philadelphia school teachers, who are members of Pennsylvania’s Public School Employees’ Retirement System, were required to pay 7.5 percent of every check to their pensions.  Legislation passed in 2010 now requires new teachers to pay 10.3 percent of every check toward their pensions if they want to receive the same pension as those hired before December of 2010; those new teachers who agree to accept a modified pension multiplier (smaller pension) can continue to pay at the 7.5 percent rate.

Health Insurance

Before the Walker bill, Wisconsin state employees paid about 6 percent of their health insurance costs.  Now they will be forced to kick in double that—about 12 percent of the average cost of annual premiums.

Philadelphia public school teachers have excellent benefits, and at little cost.  According to the current contract between the PFT and PSD, teachers have to contribute at most 3 – 5 percent of annual premiums, and many teachers pay nothing.  Co-pays do continue to go up, but teachers are in a good position here; it’s inevitable that in the future, sacrifices will have to be made, and employees may have to kick in more money.  This, of course, can be agreed upon at the bargaining table, and there is absolutely no need for new legislation to be proposed by the SRC to get this done.

The SRC’s recent attempt to push legislation to further cripple School District unions is uncalled for.  The SRC has already sent layoff notices to 2,700 service workers who are SEIU 32BJ union members, and is planning to privatize neighborhood schools and cut unions by turning 40 percent of District schools into charters by 2017.

Some can argue what Walker did in Wisconsin was justified; unions in the Badger State needed to be reeled-in to keep Wisconsin from falling off an economic cliff, which is why 30 percent of union workers voted in Tuesday’s recall election to keep Walker in office.  But the situation is a bit different in the Keystone State.

Pedro Ramos is no Scott Walker.  Shame on him for trying to use Walker’s momentum to push his misguided and unnecessary legislation to further cripple organized labor in Philadelphia.

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Filed under PFT, School Budget, SRC

To Mayor Nutter: Close Delinquent Properties, Not Schools

by Christopher Paslay

Instead of cutting badly needed school personnel and resources, Mayor Nutter should crack down on the city’s deadbeats who owe $472 million in delinquent property taxes. 

Despite laying-off teachers, nurses, school police officers and teacher aids, freezing salaries, cutting athletics, and shutting down after-school activities, the Philadelphia School District continues to struggle financially. 

Thomas Knudsen, the School District’s Chief Recovery Officer (who makes $25,000 a month), recently announced that the District faces a $218 million deficit for the 2012-13 school year, and that if Mayor Nutter’s new property-tax proposal does not pass City Council, the District may not open in the fall.

“It is not clear that we could, in fact, open schools this fall,” Knudsen said.

Nutter’s new property tax proposal, nicknamed “Actual Value Initiative,” would serve to reassess properties across Philadelphia and adjust taxes to an “actual” or current rate.  In theory, this is supposed to bring in an additional $94 million to the School District. 

But Nutter’s property tax reassessment plan is only a drop in the bucket, and continues to put the burden on hard working middle class citizens.  His plan does little to go after deadbeats who refuse to pay their fair share of property taxes, and does not adequately address the problem of vacant buildings. 

In August of last year, the Philadelphia Inquirer did a series on Philadelphia’s delinquent-property-tax collection system titled, “The Delinquency Crisis.”  In a report headlined “Taxes wither on the vine,” the Inquirer wrote:

Philadelphia runs the least-effective delinquent-property-tax collection system of the nation’s biggest cities, a system that has created a “culture of nonpayment” and cost the city and cash-strapped School District $472 million in unpaid real estate taxes, penalties, and interest.

It is a delinquency epidemic that reaches from Chestnut Hill to Point Breeze, infecting every neighborhood. In all, there are nearly 111,000 delinquent properties, or about 19 percent of all parcels in Philadelphia, according to an Inquirer and PlanPhilly.com analysis of city data.

The past-due properties include such pricey parcels as the proposed Foxwoods casino site, an Old City art gallery, a South Philadelphia hotel, and choice real estate a block off Rittenhouse Square.

But it is in low-income neighborhoods where the delinquency crisis has peaked and where the city’s response has been the least effective. . . .

According to the Inquirer report, Philadelphia has more tax deadbeats per property than any other big city in the country.  Here are some facts highlighted in the report

  • The delinquent tax problem has grown under the Nutter administration.  In May 2009, there were just over 100,000 tax-delinquent properties in Philadelphia. On April 30, 2011, the count had risen to nearly 111,000.
  • Tens of thousands of parcels are never subjected to any enforcement action beyond sternly worded letters from the city Revenue Department.
  • The city’s typical tax delinquent is 6.5 years behind and owes $4,249 in taxes, penalties, and interest.
  • 26,000 properties are at least a decade behind, and the owners of nearly 8,500 properties haven’t paid a dime for 20 years or more.
  • According to city records, the largest delinquent, owing $6.1 million in principal, penalties, and interest on five unpaid years including 2011, is Roman Philadelphia Property L.L.C. at 1499 S. Columbus Blvd., site of the potential Foxwoods casino.
  • Cumulatively, the city’s delinquent properties are 720,000 years behind in taxes.

Of the delinquent properties, Frank S. Alexander, a law professor at Emory University and a leading national authority on improving property-tax collection systems, told the Inquirer:  “That’s an astronomical level of delinquency. It is phenomenally high.  Those numbers tell you there is a very high rate of nonenforcement. It means that the city has made a decision not to go after these properties.”

Mayor Nutter may not be going after these tax deadbeats, but he is going after schools.  Nutter and Knudsen have targeted teachers, nurses, custodians, school police officers, noontime aids, cafeteria staff, athletic coaches, after-school activity sponsors, art programs, music programs, and unions, among others, in an effort to balance the School District’s budget, all of which will have a negative impact on learning. 

Not surprisingly, Nutter and Knudsen are now implementing scare tactics—à la Arleen Ackerman and the Great Full-Day Kindergarten Crisis—suggesting that schools may not be able to open in the fall.  Not unless, ahem, the School District’s five unions cough-up $156 million in givebacks, and Philadelphia’s hard working citizens (who actually pay their taxes) submit to another property tax increase.

It’s time for Mayor Nutter to get his priorities straight and make an honest effort to recover the $472 million owed to the city.  He must take the high road and finally confront the city’s tax cheats instead of balancing the School District budget on the backs of hard working citizens and their children.

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