00001 COUNCIL OF THE CITY OF PHILADELPHIA CONTINUED PUBLIC HEARING COMMITTEE OF THE WHOLE - - - Room 696, City Hall Philadelphia, Pennsylvania Monday, March 24, 2003 9:55 a.m. - - - Bill Number 03009, an Ordinance amending Chapter 10 19-1800 of The Philadelphia Code, entitled "School Tax Authorization," by amending section 19-1804, entitled "Authorization of Net Income Tax," to further authorize the Board of Education of the School District of Philadelphia to impose a tax on net income from real property and tangible and intangible personal property of residents of the School District of Philadelphia; all under certain terms and conditions. Bill Number 030012, an Ordinance amending Chapter 19-1800 of The Philadelphia Code, entitled "School Tax Authorization," by amending Section 19-1806 to further authorize the Board of Education of the School District of Philadelphia to impose a tax on the use or occupancy of real estate within the School District of Philadelphia. Bill Number 030013, an Ordinance amending Section 19-1801 of The Philadelphia Code, entitled "Authorization of Tax," to further authorize the Board of Education of the School District of Philadelphia to impose a tax on real estate within the City of Philadelphia; and to restate the rates of taxation in tabular form; all under certain terms and conditions. - - - 2 00002 PRESENT: COUNCILWOMAN DONNA REED-MILLER, Chair COUNCIL PRESIDENT ANNA C. VERNA COUNCILWOMAN JANNIE BLACKWELL COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DARRELL L. CLARKE COUNCILMAN DAVID COHEN COUNCILMAN FRANK. J. DI CICCO COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN JAMES KENNEY COUNCILMAN RICHARD T. MARIANO COUNCILMAN MICHAEL A. NUTTER COUNCILMAN ANGEL L. ORTIZ COUNCILMAN FRANK RIZZO COUNCILWOMAN MARIAN B. TASCO - - - V A R A L L O Incorporated Litigation Support Services 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 3 00003
Good morning, everyone. Good morning, everyone. May I have your attention, please. This is a public hearing of the Committee of the Whole. I would ask Mr. McPherson to read the Bill Numbers and the titles of the Bills. MR. McPHERSON: Bill Number 03009, an Ordinance amending Chapter 19-1800 of The Philadelphia Code, entitled "School Tax Authorization," by amending section 19-1804, entitled "Authorization of Net Income Tax," to further authorize the Board of Education of the School District of Philadelphia to impose a tax on net income from real property and tangible and intangible personal property of residents of the School District of Philadelphia; all under certain terms and conditions. Bill Number 030012, an Ordinance 20 amending Chapter 19-1800 of The Philadelphia Code, entitled "School Tax Authorization," by amending Section 19-1806 to further authorize the Board of Education of the School District of Philadelphia to impose a tax on the use or occupancy of real estate within the School District of Philadelphia. 00004 03/24/03 - Committee of the Whole Bill Number 030013, an Ordinance 3 amending Section 19-1801 of The Philadelphia Code, entitled "Authorization of Tax," to further authorize the Board of Education of the School District of Philadelphia to impose a tax on real estate within the City of Philadelphia; and to restate the rates of taxation in tabular form; all under certain terms and conditions.
Thank you. Good morning and welcome. Mr. Nevels, please identify yourself for the record and proceed with your testimony.
Thank you, Council President. My name is James Nevels. I'm the Chairman of the School Reform Commission. And it is good to be here. Good morning, Madam President, Councilwoman Miller, and Members of City Council. Thank you for the opportunity to review with you the state of the School District of Philadelphia. When I came to you a year ago, the School District faced tremendous challenges: Academically, financially, operationally, in 00005 03/24/03 - Committee of the Whole safety, in leadership, and in our facilities. Most students were not reading at grade level, and 40 percent of students were dropping out before graduation. Financially, the District faced $1 billion in debt. My colleagues on the School Reform Commission, Sandra Glenn who joins me this morning, Jim Gallagher, and Dan Whalen could not believe that we could not identify the reconciliation of budgeted to actual expenditures, and we faced an enormous structural deficit. I would also mention, of course, our colleague Mike Mash, who is no longer with us. And I think we know where he is. And hopefully he will remember and help the School District. His appointment is currently vacant. Let me say this to you, as I've said to a couple of you this morning: What a difference a year makes. What a difference a year makes. Over the past year we have made tremendous strides in reforming public education for Philadelphia's children, being called by some the largest educational reform movement in the 00006 03/24/03 - Committee of the Whole United States. One thing for certain was, things are not the same, and should not be for our children. We are making progress. First and foremost, in July 2002 we hired Paul Vallas to be the School District's Chief Executive Officer. Under his leadership the School District is implementing aggressive policies and improvements to overcome years of status quo. You will hear in greater detail from my colleague, Paul Vallas, and Michael Harris, the District's Chief Financial Officer. But from an overall perspective, I can tell you that one year later, the School District is: Number one, academically focused, as significant strides have been made in reforming our educational system. Educational management Organizations. s, are managing 45 of our lowest-performing schools, and we are working closely with them to ensure that those students are learning. 00007 03/24/03 - Committee of the Whole The District's curriculum is uniform and aggressive, as we work to ensure that all of our students are reading at grade level and achieving in mathematics and sciences. The School District is recovering financially, through significant cost savings measures, that have been implemented over the past year. Thanks to this City Council, and again, I say to you individually and collectively, thank you. Thank you very much on behalf of the children of Philadelphia. The General Assembly -- I should say and the General Assembly -- and we thank them as well -- the School District has received the funding it needed to keep it solvent and ensure that all of our students have the proper educational materials so that they could learn. But we are not out of the woods yet. As you will hear, significant cost-cutting measures have been implemented, some of which have been very difficult. The District cut $25 million via work-force reductions and other efficiencies, as 00008 03/24/03 - Committee of the Whole we promised you and the Commonwealth last spring. We sought your trust. We believe that we have earned your trust by our behavior. The District went on to identify an additional $44 million of other efficiencies within the system, and we have also rectified that. The School District is operationally efficient, issuing an RFP and moving forward on consolidating our administrative facilities. Having staff in four locations, including a $1 million lease on one is not financially or operationally efficient.
We intend to identify a single location very shortly to house all our staff and to build a managerially cohesive culture at the Philadelphia School District. Today the School District is focused on improving climate and safety for our students and our teachers. Learning cannot occur in an environment in which students and teachers are not secure. In September, the School District unveiled its Code of Conduct which establishes a 00009 03/24/03 - Committee of the Whole blueprint for student behavior. The School District's Zero Tolerance Policy is a bold first step to removing disruptive students from the classroom. Some say it's too harsh. But we mean business. As the Chairman of the School Reform Commission, I believe that if being obsessed with the safety of our children and our educators is a vice, then I am for one willing to be guilty of that crime. Parents must be involved in their children's academic experience. And if removing those disruptive students engages their parents, we will have succeeded. Among other initiatives we have taken, include easing students from incarceration back into the classroom. As a year ago, no longer will those students be placed back into a classroom without the proper academic, emotional and social preparation. Doing so has only resulted in repeated incarcerations and failure. The School District is committed to improving our School facilities to provide each and every student a pleasing environment in which 00010 03/24/03 - Committee of the Whole to learn. Last May the SRC journeyed to 70 schools slated for reform. In some buildings the paint was crumbling, the lighting was insufficient for children to learn, and proper running water did not exist. This is patently unacceptable. And these were in the better facilities. Some buildings were so old that they presented safety hazards. 5 billion Capital Plan to build new schools and rehabilitate others, eliminating school overcrowding and creating school campuses that students will be proud to attend. The School District is community-based through the new office of School and Community Relations, that seeks partnerships between schools and communities to engage parents, students and neighbors to take active roles in our students' educations. Our school system is diverse, working for all of Philadelphia's children, regardless of gender, ethnicity or income. And finally, but certainly not 00011 03/24/03 - Committee of the Whole least, the School District is now leadership driven. Since Paul Vallas came to Philadelphia eight months ago, we have seen a tireless advocate for Philadelphia's public schools. In addition, Council people, I can tell you, he's just a good guy, too. There is no 10 person who has worked harder and smarter for the children of Philadelphia than Paul Vallas. There is no person better suited to making the tough decisions with the SRC to improve the education of Philadelphia's children than our CEO. What a difference a year makes. I would now like to introduce the School District's Chief Executive, Paul Vallas.
Thank you. Well, thank you. Thank you, President Nevels, and Madam President. Thank you for this opportunity to come before the Council. I just want to recognize and introduce to the Council a number of our executive staff, most of whom are here and all of whom will be here before the testimony is over. 00012 03/24/03 - Committee of the Whole First of all, Natalie Pakeen, my Chief of Staff, if Natalie can just raise her hand. Tim Spritzer, my Deputy Chief of Staff. Craig Williams, our Deputy Chief Academic Officer. I don't know if Ed Williams has arrived.
If the individuals would stand, I think it would be nice. We would get some --
Great. Let me start out with Natalie Pakeen, my Chief of Staff. Tim Spritzer, the Deputy Chief of Staff. I know you've all had contact with Tim. Dr. Craig Williams, our Deputy Chief Academic Officer in charge of our High School Restructuring Plan.
Excuse me, Mr. Vallas. I understand some of the Council Members cannot hear you.
Oh, great. Great. Okay. Dr. Craig Williams, my Deputy Chief 00013 03/24/03 - Committee of the Whole Academic Officer, also in charge of the High School Restructuring Plan. Ed Williams is -- I don't know if Ed's arrived yet -- our Chief Academic Officer. Karen Burke, our Chief Operating Officer, if she will please stand. Chris Harris, who's the Director of the School District's Capital Program. Ellen Savitz, our Deputy Chief Academic Officer. She's managing the EMOs, the charters schools, as well as the new school conversions, and the academic side of the new High School Restructuring Plan. Kim Seitzer, our Chief Procurement Officer. I saw Kim way in the back, if...
Dexter Green has not arrived yet, but he'll be arriving shortly. He's had to deal with one or two issues this morning. And we always have public safety issues that we have to deal with. But our Director of School Security, Gwen Morris, who manages our alternative schools and our school discipline programs and policies 00014 03/24/03 - Committee of the Whole will also be arriving. Nilsa Gonzalez, our Director of School and Regions, who is responsible for the day-to-day management of the system, in terms of the system's interaction with local schools. And Tomas Hanna, who will be arriving shortly, who's our Director of Teacher Recruitment and Retention. So that is the senior staff. We are also, as I think Jim pointed out, joined by Sandra Dungee Glenn, one of the five Commission members and clearly a force in the changes that we have been pushing, both now and of course long before I arrived. What I'd like to do is to provide kind of a general budget overview, but talk not only about the budget but also talk about the programs, because this budget is driven by our initiatives. When we worked to put together our budget, we did so with an idea in mind that everything that we would do and every decision that we would make budgetarily would support our education reforms and our education initiatives. 00015 03/24/03 - Committee of the Whole And so, I'm going to take a few moments and talk about in general terms the overall budget strategy and the overall budget plan, and then just spend even a little more time talking about the objectives of this budget. And that is, to make our schools safer, to improve the physical conditions of our schools, and to improve the academic programs so that we can enhance education performance. And then I'll be followed by Mike Harris, who can get into the specifics of some of the budget document that we presented to you. Let me start off by saying that one of the first things that we did when we came in was to lay out a five-year financial blueprint for the School District. We were facing, with no changes, a long-term imbalance of about $1 billion, based on what projected expenditures were, as well as based on what projected revenues were. So the fist thing that we did in July was, we quickly began the work on laying out a financial blueprint, a blueprint that would enable us to keep spending in line with revenues 00016 03/24/03 - Committee of the Whole and draw down the deficit financing bond, which we were authorized to issue over a five-year period. So in effect, we could guarantee the School District five years of financial stability. But in putting together that plan, we put that plan together with an eye towards funding initiatives and pushing initiatives that would make schools safer, pushing initiatives that would rehab the terrible condition of our schools, and pushing initiatives that we knew would guarantee improved student academic performance. When we finalized our five-year plan, you afforded us the courtesy to brief virtually every Council Member on the details of that plan, both in terms of the financials and in terms of the academics. So going into the original five-year plan would only be redundant. But let me just say that the first year's results of the five-year plan really exceeded our expectations. We went from a projected $28 million operating deficit to a structurally balanced budget where we anticipate we'll have a slight surplus this year. 00017 03/24/03 - Committee of the Whole But in the process we were able to hit our first-year numbers in our five-year plan. We did that by cutting about $51 million in spending last year and by securing close to $62 million in new revenue, some state sources, but others largely Federal sources. Like the Empowerment Zone Grant, additional Title One and Chapter One money that we had not anticipated, additional funds under the No 11 Child Left Behind Act.
In effect, we were able to secure additional money on top of the cuts so that we were able to balance our budget, but then at the same time we were able to pursue our education initiatives. And let me point out that just in the first year we've begun to lay the foundations of our School Construction Repair Program. Just in the first year, we've begun to institutionalize our After-School Extended Day Program. Today, all of the schools have after-school extended day. There are slots for close to 35,000, 40,000 students. This summer we will probably have 00018 03/24/03 - Committee of the Whole the largest summer school program in our history, about 50,000 students. But the creation of the Office of Accountability, the professional development, and the upgrade in professional development training, the initiatives that we undertook, in terms of setting up an alternative schools network, so that in a Saturday, what we call a Saturday Alternative Program for expulsion for students who are badly behaved. So in effect, we just did not hit our budgetary goals in year one, but we also began to lay the foundation for what is intended to be our long-term educational goals, our long-term educational plan. But now we're preparing for year two. In facing the year two budget, we were -- Well, we were reasonably confident that we were going to be able to hit the numbers that we had anticipated hitting, in terms of our abilities to secure Federal funds. And obviously, while our local revenue base has been pretty close to certain, there was uncertainty as to what would be 00019 03/24/03 - Committee of the Whole available at the state level. So we decided to prepare our budget document, based on Governor Rendell's original budget that he introduced, and that was passed, and that he amendatorily vetoed in Harrisburg. And that was to base that budget on the assumptions in the governor's original budget, particularly for education. Our reason for that is, we felt that we should go with a worst-case scenario, and that we should use that first budget as a vehicle for going in and jettisoning other expenditures in the school system that we felt did not fit with our education plans and education strategies. So rather than going in and cutting core programs, what we elected to do was to go in and to jettison anything that we felt was not directly or indirectly impacting the classroom in a positive way. So the Governor's budget left us approximately $65 million shy from year two of our financial plan. And so to close that hole, we came out with a number of proposals to cut spending an additional $48 million to reallocate 00020 03/24/03 - Committee of the Whole Federal --
Excuse me, Mr. Vallas. Councilman Nutter has a point of information.
I just want to make sure I understand the statement that you just laid out. Your testimony is that the budget in front of us is based on the budget that the Governor introduced. I believe that was on...
March 4th. Trying to keep track of all these days. But I think what I hear you saying is that possibly based on what the Governor's going to put forward literally tomorrow, many of the proposals or assumptions in the budget in front of us today more than likely will change, and possibly change somewhat significantly; is that correct?
Well, yes. Obviously, 00021 03/24/03 - Committee of the Whole the revenue assumptions will change, and obviously in terms of where we provide the additional money, where we refocus the additional money. Programs like After-School Extended Day Class Reduction, those assumptions will change, too.
So even though City Council does not technically approve your budget, but you're here ostensibly for a budget hearing on actually the tax bills, there still remains, naturally, the general perception that we hold, quote, unquote, budget hearings about your budget. We ask you about the assumptions and the proposals. We don't actually approve your budget. There are items in this budget, as I think you well know, that will raise a significant amount of concerns in a variety of quarters. You will come; you will go. The Governor will do what he does tomorrow. We would all hope that there would be a somewhat more extensive budget process on the second go around. I don't know if it's possible that it could be shorter than the first go around. So we'll assume all the best 00022 03/24/03 - Committee of the Whole interests and intentions of the folks in Harrisburg. But you will have left. And we will then be in a position to have possibly, quote, unquote, accepted this budget that's in front of us, with all of its issues attached to it. And I doubt that you will be back after the Governor puts forward his budget, after the Legislature does what it does, and after you then subsequently possibly restore or change many of the assumptions that are in this budget. Is that a fairly accurate portrayal of the current scenario?
Well, clearly, if there is a compromise on the Governor's budget, then there's no certainty; we will obviously make adjustments. But we will afford the Council always an opportunity to come back and to sit with the Council, both collectively and individually, to obviously address some of the issues that this first budget has raised. But if I can just lay out kind of a general overview of what the strategy is, the strategy here is the following: This is a School 00023 03/24/03 - Committee of the Whole District that has not been spending all of its resources or all of its critical resources in the classroom. It's a School District that doesn't have enough teachers, that has not dedicated enough money for school construction, that has had virtually no after-school summer school programs, a School District that has not spent its professional development dollars effectively, a School District that carries positions that have no relationship to the educational responsibilities that the School District provides. And so we feel that, once again, selecting the Governor's first budget was first of all the fiscally responsible thing to do, but then going in and identifying things in our budget that could be jettisoned so that we could meet the year two projections, the year two financial goals of our five-year financial plan, and yet still sustain the programs that we have laid out for you, both privately as well as publicly, and that I'm going to summarize again, was also the right thing to do because it sets the stage. 00024 03/24/03 - Committee of the Whole It sets the stage for a compromise on school funding, for perhaps the Governor's second budget or a compromise on that second budget. And then what we could do with those additional resources, with those additional revenues, is put even more money in the classroom. You see, the five-year financial plan that we've laid out and that we update for you all today is roughly balanced through now to 2008. But in 2008, the deficit financing bond reserve is gone, and there is a structural deficit that needs to be closed, necessitating another round of heavy cuts as early as for the 2008, 2009 budget. And while that may be too far into the future for some, it's certainly not too far in the future for this Council that always obviously thinks ahead. So if the state does begin to restore the funding that has been made available that we had assumed that -- or we had projected that we would get or we would have liked to have gotten, if there is a compromise on school funding 00025 03/24/03 - Committee of the Whole reform, and the $65 million is returned to the School District, then what happens is, we cannot only put more money in education initiatives, but we can in effect correct the long-term structural imbalance that this District faces, in effect, institutionalizing the programs that we've laid out, not for five years or six years, but for 9 years or 15 years, in effect, having transformed 10 the entire financial and academic programs in the School District, re-prioritizing things, so that we can really move this School District forward. So our strategy has been to budget conservatively, to go in and to make changes to the budget that we feel did not directly impact on the classroom, continue to sustain our educational initiatives that we've laid out; and if you can just afford me about 10 or 15 minutes to summarize them. And then also set the stage for Rendell Two, or as some people said, Rendell Two and a half, you know, and whatever actually becomes reality. And then that means for the first time, when this District receives new resources 00026 03/24/03 - Committee of the Whole from the state, those resources are going to go into not only correcting long-term structural problems that this School District has had for a number of years, but also we'll be able to have even more resources for the classroom.
We'll have even more resources for after school, and summer School, and class size reduction. And so that has been our strategy. It's kind of always been our strategy to budget conservatively. So as the state moves along in the budget process, of course we have to let schools know what their resources are going to be in March, because there are significant educational reforms here that the schools need certainty about. And I'm going to describe just a few of them in a second. But while we will move obviously on this budget, we will do what we always do: We will amend the budget, if there are changes in anticipated funding levels from Harrisburg. And we'll certainly afford the Council an opportunity to have input, and to come before the Council to talk about changes we will make or we plan on 00027 03/24/03 - Committee of the Whole making before those changes are actually made. It's the very least that we could do. Now, let me -- I'm sorry.
Councilman Ortiz, your hand is up. Did you want to be recognized?
Madam Chair. Mr. Vallas, you're doing what Rendell is -- You're presenting two different budgets at the same time. And I'd like to find out, when you say you're budgeting conservatively in this go around...
...and you're projecting a series of cuts that do not affect classroom instruction --
-- in classroom. Could you detail to us what those cuts are?
And if any of those cuts that are being done are being projected to be re-integrated into the budget later on, as the budget -- the Rendell Budget Two takes effect or if it comes about, and... 00028 03/24/03 - Committee of the Whole
If I may. I think we should have Mr. Vallas continue with his testimony.
-- also to testify. And after their testimony, we can then ask questions. So Mr. Vallas, would you please proceed with your testimony.
Thank you. But we'll get back to your... As soon as we're done with the testimony. Let me explain the education initiatives that we are going to continue to pursue and improve upon in this budget. I'm going to take them in the following order: First of all, I'm going to take them in -- I'm going to talk about public safety first, I'm going to talk about capital second, and I'm going to talk about 00029 03/24/03 - Committee of the Whole education third, leaving the most important obviously to last. On the public safety side, this budget will allow us to continue our expansion of our alternative schools programs. We are anticipating that we will have at least to 8 alternative school locations or sites next year, 9 because we are going to be expanding the 10 Alternative Schools Network that we use to handle, not only student discipline problems, but also to handle the students that come through Act 88, the state law which requires that we not return students to neighborhood schools, students who have been incarcerated. In addition, this budgets also expands what we call our Saturday Detention Program, or SMART program as we call it. This is our Saturday School for students that are chronically bad behaved. They are put in Saturday schools as an alternative not only to expulsion, but also students who may be working their way towards expulsion, who need some intensified counseling. The objective here is not to send a 00030 03/24/03 - Committee of the Whole student home for five days, in which case the student comes back from the suspension even more disruptive or further behind than they were before they were suspended, but to put students in Saturday programs. And we have nine sites operating now. The program started at mid-year. We hope to hopefully double the sites in the coming year. And we're obviously working not only locating those sites in our neighborhood high schools, but also we're working with religious institutions, as well as community providers, in order to also expand those sites. So... But in addition to those initiatives, you will see in this budget that there's an expanded investment in intervention. There's an expanded investment in outreach. There's an expanded investment in the creation of crisis intervention teams that can work with high schools and work with elementary schools that are having problems maintaining student discipline. So it's simply not about expelling students. It's also about getting them into more intensified detention or counseling programs, the 00031 03/24/03 - Committee of the Whole Saturday schools being the prime example. And it's also about providing intervention -- providing quicker intervention services. Right now we have intervention teams and we have networks of community providers in all nine of our regions who work with our regions intervening in schools and providing support to schools where we are having problems with student discipline. These initiatives will be sustained, and will be built upon in this budget. Let me talk about capital. On the school construction side, this budget continues the expansion of our Capital Program. 5 billion in school construction over the next five years. Now, that is money obviously that's going to be generated through the issue of 30-year school construction bonds. It's going to be partially subsidized through the state plan com program, which reimburses the local school districts to the tune of about 20, 22 percent of their debt service on school construction if it qualifies. But we are going to proceed forward. 00032 03/24/03 - Committee of the Whole In about two months, we're going to sell our first $300 million school construction bond, and that is already funded or already provided for in this previous year's budget. But next year, we'll be issuing about the same time, March or April, our second $300 million school construction bond. So the school construction program is going to move forward.
And as you know, if I can just summarize the goals of that school construction program, the school construction program is intended to build at least 11 new or replacement high schools to pay for the renovations of -- major renovations, to the tune of $10 million to $15 million in between 13 to 15 neighborhood comprehensive high schools, and then provide for what I call modest renovations in the balance of the high schools. But the school construction program also provides for the construction of, I believe, between six to eight new elementary school buildings, and I believe about a dozen additions or little red schoolhouses so that we can relieve overcrowding. And the budget also provides for 00033 03/24/03 - Committee of the Whole maintenance and repair upgrades in the majority of our schools. We have organized our trades into what we call minute men teams, in the Colonial tradition, and every week teams are in schools spending between one to two weeks, and sometimes more in those schools, repairing and fixing everything that needs to be done. And we anticipate using this program. We're going to go in and do major interior renovations in all of our elementary schools, to the tune of about 35 to 40 a year, on top of the basic repairs that we normally do. So the Capital Plan is driven by a need to expand the number of high school options, to reduce the size of our high schools by creating more high schools, to replace obsolete and falling apart high schools. It's also driven by a plan to relieve overcrowding in our elementary schools, and to provide the basic renovations that our elementary schools need. And let me point out that one of the highlights of the plan is to make sure that every single neighborhood-based high school, 00034 03/24/03 - Committee of the Whole comprehensive high school, has state of the art science labs and technology labs, and library multi-media centers, so that the critical classrooms -- the critical classrooms: Technical, science, library, learning center classrooms in the high schools are on par with any suburban high school out there. The Capital Plan will not address all of our needs. 5 billion construction plans over the next five years, all of the high schools will be fixed and repaired structurally and physically, and overcrowding at the elementary schools where it exists will be alleviated, and all of the elementary schools and the middle schools will have had the needed repairs that they have needed to basically -- so that they remain viable buildings. If we receive more money from the state, obviously, we're going to pump more money into the elementary schools. But this is a pretty ambitious plan. Let me also point out that we are 00035 03/24/03 - Committee of the Whole reasonably confident that we are going to be able to finish the plan on budget, because with the support of the unions, we have been able to receive a waiver for the first three-year construction -- the four-part bidding contract provision, so in effect we can expedite contracts, and we can make sure that those contracts are provided -- are executed in a timely fashion. I will also point out, then -- we'll have an opportunity to answer more detailed questions on this -- that all of our construction programs, as well as our professional service programs, will have MBE-WBE goals. And just to give you an example, the prime contractor who we brought in, the prime manager who we have brought in to manage our construction programs, 43 -- I think 43 or 47. 43 percent of that contract went to women or minority-owned businesses. And this will be a pattern that we will pursue very aggressively when it comes to contracting out. Now, let me talk about the education initiatives. This budget continues to fund the education initiatives that we have laid out 00036 03/24/03 - Committee of the Whole publicly over the last four or five months.
On the early childhood side, simply through a re-programming and a re-prioritizing of how we spend our early childhood money, we are going to be able to put an additional 2500 children at risk into early childhood programs. And we are going to be able to create a comprehensive zero to three program that will identify pregnant teens in the high schools, and make sure that the pregnant teens are assigned a parent advocate or parent trainer, and provide day care and pre-school for the pregnant teens. 5 million to help supplement the program. But we are also reprogramming and reallocating existing revenues so we can expand the slots. If you look at the early childhood budget, we spent $32 million on 2200 students, and many of whom are not at risk in early childhood programs, very inefficient programs. And by reallocating those resources and by upgrading those programs, in terms of the number of students who are in those programs, 00037 03/24/03 - Committee of the Whole we're actually going to be able to reach more students. But there's going to be an expansion of our early childhood initiatives in this budget next year, with the cradle to the classroom, the zero to three program, and there will be at least 2500 additional students in that program. Now, if the Rendell Administration is successful in meeting the Governor's early childhood priorities, then we will be able to increase the number of children in early childhood to an even greater amount. But we estimate that close to 1500 children zero to three will be put in day care under the cradle to the classroom program. So, this will be the most significant expansion of early childhood we've ever had. If I can just go through, we have already made our conversion to the Terranova Test. We already have our Office of Academic Accountability that provides quality review of all our schools and works with the schools to develop plans of reform, plans of quality review, changes that need to be done in the schools, if those 00038 03/24/03 - Committee of the Whole schools are struggling. But the shift to the Terranova, which incidentally, is also going to save us money, has also provided the school system with the test, the results of which can be communicated to teachers and to parents within 30 days of that test being given. And it's given teachers and parents a diagnostic tool that they can understand the results of. This year we got the Terranova results after 30 days, and two weeks after that we sent the results to the parents, so the parents were able to get a breakdown of where their child's strength and weaknesses were. It's also a test that is aligned with the state standards. It's a state that the Archdiocese gives, and it's a test that is very similar in form and in content to the state test, which meaning, when you're preparing kids for the state goals, you're also going to be covering the material in both the Terranova Test, as well as the PSSA test. So those things have already begun. But all of the schools next year, as 00039 03/24/03 - Committee of the Whole we move forward, the education plan lays the foundation for the phase out of our middle schools. What we're going to be looking at doing over the next five to seven years is to reduce significantly the number of our middle schools. Next year three middle schools are scheduled to be converted to high schools; ultimately, 9 to 10 will. And a number of -- at least the same number of elementary schools or of middle schools will be converted to K to 8 schools. And then next year, beginning next year, 45 to 50 K to 5 schools will begin adding grades, meaning parents are not going to have to be stressed out at the end of fifth grade about worrying where their children are going to have to go to School. And as you know, only two to three of the middle schools in the school system are meeting state standards. There is an exodus of students before the middle school years.
Our middle 00040 03/24/03 - Committee of the Whole schools are fed by far too many feeder schools. The vast majority of our schools are on the No Child Left Behind academic watch list, not to mention the state's watch list. So, converting and moving to a K to system and a 7 to 12 system, I think, is the right thing to do. 8 Our hope is within five to six years, if we have 9 middle schools that remain, they will be fed by maybe one or two feeder schools. So, again, those reforms, we are going to -- we will continue to move forward on in this budget. And in addition, and as part of our high school restructuring plan, by converting middle schools to high schools, by supporting the middle school charters that are performing in an exemplary fashion -- and there's four or five middle school high schools that we're going to support the expansion of because they're providing superior academic options. And by building a number of new middle schools, we feel optimistically that within the next four to five years, we're going to have close to 15 and maybe as many as 20 new high schools options. 00041 03/24/03 - Committee of the Whole So what will happen will be, when children graduate from eight grade, they'll have, instead of 3 magnet schools to apply to, maybe 8 or 9 or 10 magnet schools to apply to, not to mention the high performing charters. And to magnetize our neighborhood schools, we are going to be putting magnet programs in advanced placement and honors programs in our neighborhood high schools, and opening the enrollment in those high schools. So in effect, you're going to have high school choice. In effect, when a child graduates eight grade, if that neighborhood school is not a school to their satisfaction, they're going to be able to apply to one of perhaps as many as a dozen citywide high schools, or for that matter, one of as many as two dozen what we call neighborhood-based magnet programs in neighborhood high schools, like international baccalaureate programs and world language academy programs, and math, science, and technology academy programs. So what you'll have for the first time is options. So if that neighborhood school is not to your satisfaction, you just don't have 00042 03/24/03 - Committee of the Whole to line up out at Central or Girls High and say, where am I going to go. There are going to be plenty of options. There will be no excuse for exiting the system or leaving the system because the system does not provide quality academic options. If I could just give you one statistic to drive home the point, we have 61,000 students in high schools. Only of our 46 high 11 schools have advanced placement and honors 12 courses. Only 1,000 of our 61,000 kids take advanced placement and honors exams. I was watching an advertisement that New Jersey Department of Education came out with yesterday trumping New Jersey as the top state, in terms of percentage of kids taking advanced placement and honors programs. We don't have an advanced placement and honors courses, so how can our kids take the AP exams? We have high schools with 2500, 3,000 students who don't have a single honors course in those schools. Only 5,000 of our students took the SAT. 61,000. Now, that's for 00043 03/24/03 - Committee of the Whole all intents and purposes, the college entrance exam. Only 5,000, less than percent. 4 And even more disturbing, only 7400 5 or 7500 of our students -- and correct me if I'm 6 wrong Craig -- took the PSSA, which means probably 7 only half the kids are taking the state exam who 8 should be taking the same exam. That is going to 9 change and is going to change dramatically. 10 So these reforms are not only raising standards as to why, but these reforms are about making institutional changes, phasing out the middle schools, so that our kids can transition to high school through a K to 8 system, so that we don't have 1500 sixth, seventh and eighth graders piled in a building four to five stories high.
And when our children go to high schools, those high schools present them with choices, not only choices citywide, but the neighborhood high schools present them with choices in the neighborhood high schools themselves. But those initiatives are funded in this plan. In addition -- In addition, if I can 00044 03/24/03 - Committee of the Whole just quickly comment on a couple of other initiatives that are also funded. Last week we laid out our plans to reform our curriculum and instruction. This time next year all the school system will be on uniform standardized curriculum instructional models. We've picked models that we feel are the best practice models. Our focus in the initial years is going to be reading and math. And we've gone to great lengths to ensure that all the curriculum instructional models that are adopted are models that are multi-cultural, are models that lend themselves. And our selection of hard core trophies, as well as our approval of supplemental curriculums are guided by not only the superior nature of those curriculums -- and let me point out that the curriculum models we're selecting have the approval of the Federal Department of Education, so we're not selecting curriculum models that we can't secure funding for. But those curriculum models are also selected because we feel that they lend themselves now to what we 00045 03/24/03 - Committee of the Whole call a true multi-cultural curriculum. But in addition to the curriculum and instructional reforms that all the schools will have next year, we are going to support those curriculum and instructional reforms by doing the following things: By increasing the school day and increasing the school year. Next year, our after school extended -- our after school program will really be an extended day program, because any child grades three through nine below grade level in reading or in math will not have their school day end at 3:30. They will have their school day end after one to two hours of additional academic instruction. And we're selling it as extended day because we want to create the mentality out there that this is part of the school day. Our school day runs this long for underachieving children. The same thing in summer school. Children grades three through nine will have to go to summer school if they're below performance in either reading and/or math. And if children have special education needs or if children are ESL 00046 03/24/03 - Committee of the Whole students with English language deficiencies. This will be not summer School, but extended School year, because it will be part of what we consider to be the normal school year for students who are not meeting the academic standards. So while the schools will have curriculum and instructional models, we will spend more time, extended day and extended year, teaching the children who are struggling to those models. But in addition to the more time on task, all the schools next year are going to go through year-round professional development. We have reached an agreement with the teachers union to provide for end of the year professional development of teachers, professional development through the summer, and professional development twice a month two hours a day. So twice a month there will be two hours of professional development time set aside. So, in effect, not only will we have curriculum instructional models and time on task, but we will have the professional development to go with it. And on top of the professional 00047 03/24/03 - Committee of the Whole development, the budget -- this budget provides for curriculum and instruction experts. Every one of our nine regions will have five curriculum coordinators who will work with the schools on continuous professional development and in-service training of teachers.
In addition, we will be designating a reading and math curriculum coordinator in each of the elementary schools and the high schools, so there will be a network of curriculum experts to sustain the quality curriculum instruction by being there to help the teachers, to assist the teachers, and being there to facilitate professional development. And then finally, we will do probably the most massive class size reduction that this system has ever done. Our plan next year is to reduce class sizes in all the elementary school grade levels, grades kindergarten through third in schools that have the additional space. If they don't have the additional space, we will hire literacy interns. We are providing the School Districts with models on how they can reduce their 00048 03/24/03 - Committee of the Whole class sizes, grades four through eight. Now, when you look at this budget, we are going to be jettisoning close to 500 SSA positions because we are going to be hiring over 500 new classroom teachers. So, in effect, we're going to be reducing class size on a massive scale that few Districts in the nation have basically done or have basically embraced. And this will begin next year. Also, at the high school level we are going to be reducing class size at key grades. So, for example, no longer will we say, well, we don't have enough honors chemistry students, so we can't have an honors chemistry course. If we have to have an honors chemistry course with 12 or 14 or 15 students, so be it. And no longer will which stuff 33 algebra students in a freshman algebra course with a single teacher, and then mandate that they master algebra in a year with two-thirds of the kids never having had pre-algebra. Algebra classes, the freshman math classes, will be no bigger than 15 students per 00049 03/24/03 - Committee of the Whole instructor. So, the class size reduction initiatives are going to, I think, significantly transform the nature of the system. So if you have quality curriculum, if you have more time on task, if you have professional development, and you have class size reduction, you're going to see a dramatic change in instruction. And then, finally, all of our curriculum instructional models will have parental outreach pieces: Curriculum guides for parents, homework guides for parents, a system of communicating with parents, simplified report cards, simplified dissemination of test core information. And we are going to be working with our parent truant officers to teach them to do home outreach to parents who are not academically engaged in their child's education. So if a parent is not coming to pick up the report card, or if a parent is not coming to parent/teacher conferences, or not responding to communications that are being sent home to that parent, we're going to make a visit. And we're 00050 03/24/03 - Committee of the Whole going to have a parent make a visit to that home to try to get a handle on what's going on. Those initiatives are in this budget. And then finally on teacher recruitment and retention, as you know, two weeks ago, under the leadership of Sandra Dungee Glenn and Rosemary Greco, we laid out a plan to improve teacher recruitment and teacher retention, through alternative certification, through incentives, through providing more teacher mentoring when teachers enter the system, through student/teacher subsidies so that we can recruit a much larger student/teacher core into the system, the conclusion being, we can retain more teachers. But our end through contracting out with not for profit corporations, like Teach American and the National Teachers Project, to expand our teacher recruitments efforts nationwide, we hope to have at least 500 to 600 additional certified qualified teacher candidates through this program.
And we feel that if we can get the teachers in, we will be able to retain the teachers because they will be provided a mentor, 00051 03/24/03 - Committee of the Whole they will be provided curriculum instructional models, they will be provided smaller class sizes, they will be provided year-round subsidized professional development. So we feel that we can make significant progress increasing the pool of qualified teachers and reducing the attrition. Between two or three years in this system, 40 percent of the teachers are gone. They have exited the system. So we feel that these things are going to help us in the area of teacher recruitment and teacher retention. These things, likewise, are funded in the budget. Now, some people will say, well, how are you doing this, or how are you going to be able to do this, in light of the Rendell budget cuts? And what I'd like to do is just take two or three examples of how we're funding each of these initiatives and how these initiatives fit into our budget process. I've referred to kind of our budget approach as having what we've referred to 00052 03/24/03 - Committee of the Whole affectionately as the financial equivalent to watertight compartments. Let me give you an example of our efforts to recruit, of our efforts in curriculum instruction and professional development. Now, the plan as I summarized is simple: New curriculum instructional models, more time on task, year-round professional development, smaller class sizes, parental outreach. Well, how are we going to deal with all these issues during financial tough times? Well, let me summarize by saying, we already spend $40 million on curriculum, instruction, and textbooks in this system. But because we don't have a standardized curriculum, because we've got schools doing 600 different things, the money is not spent efficiently or effectively. The move towards a standardized curriculum allows us to leverage the fact that we're going to be working with fewer curriculum providers, and we're going to be purchasing more standardize materials so that we can get a bigger bang for our buck. And we can purchase materials 00053 03/24/03 - Committee of the Whole that basically fit within the curriculum strategy. We spend currently $46 million on class size reduction, the bulk of the money going to literacy interns. Now, think of this math. If you have three third grade teachers and they have one literacy intern, you have one teacher that benefits. But if instead of that literacy intern, you hire a fourth third grade teacher, then all the third grade teachers, all the third grade teachers educate eight fewer students. In effect you reduce the class size from 33 to or 15 24. The bottom line is, that money can lay -- our 16 focus is going to be on hiring teachers. 17 In addition -- In addition, there 18 is -- we've been able to secure close to $15 19 million in funding for our summer school programs, 20 through the Arlen Spector Empowerment Grant, not 21 only for this year but for next summer with the 22 commitment for a third summer. 23 We've been able to reallocate $17 million in Title One reallocation for our after school extended day programs. 00054 03/24/03 - Committee of the Whole By doing that, incidentally, we bring our after school extended day and supplemental services in line with No Child Left Behind, making us eligible for even more resources. And we've been working with the School Districts -- We've been working with the School Districts to identify -- to identify local funds that they can use, Title One and Title Two funds that they can re-prioritize to do class size reduction. So in part, it's a securing of additional federal funds, but it's also a reallocation of existing dollars. 5 million for our early childhood initiatives from the Federal Government.
And finally, we've reached in -- I wouldn't say finalized, but we've reached kind of an agreement, a general agreement, that we will be able to secure money from the Parking Authority to finance a borrowing that we will do to do the 00055 03/24/03 - Committee of the Whole one-time curriculum replacements and textbook replacements that need to be done. Because in this push towards a more standardized curriculum, there's going to be a first-year up-front cost that's going to go beyond our capacity to finance, unless we're able to borrow and to secure that borrowing with an outside revenue source. And the Parking Authority has agreed to provide us with a revenue stream, so that we will be able to borrow next year upwards from $20 million to $25 million to also finance this initiative. So, once again, this initiative is watertight. This initiative will be funded regardless of what happens in Harrisburg. But the most important investment, the investment in curriculum, instruction and professional development, and class size reduction, the investment in new textbooks, the investment in the type of programs to provide student support, extended day, extended school year is an investment that we can make because we've allocated the resources. 00056 03/24/03 - Committee of the Whole And then finally, to fund our initiatives in the high schools -- And let me give you another example of how we're going to be able to do our initiatives in the high schools. Our high schools have hundreds of courses that are, for all practical purposes, irrelevant. All you have to do is look at the courses. I think, in many ways, the courses are designed to meet the individual skills of the instructors, as opposed to the needs of the students. And we've identified at least 322 academic courses that we feel are not relevant, that we can eliminate, freeing up $5 million to pay for our advanced placement courses, our honors courses, our international baccalaureate courses; In other words, money that can be simply be reallocated. In the high schools you have small learning community coordinators, you have slick coordinators, you have so-called curriculum coordinators and department heads. While there are already the 00057 03/24/03 - Committee of the Whole positions there to reallocate and re-prioritize so we can make sure that all of our high schools have curriculum and instructor experts and trainers in those schools. So there are resources in the high schools that we're easily going to be able to reallocate. But to supplement our high school resources, we're go going to be shifting $10 million from the privately managed school contracts to our high schools to fund our high school initiatives. Our general feeling, based on our evaluation of these privately contracted schools, is that we're paying them more than they need, we're paying them too much when you consider the amount of overhead that they're spending, and high schools have not been a part of this whole Reform process. So, again, a watertight compartment. There's money to be reallocated in our high schools, and there's money elsewhere in the budget that can be shifted to the high schools to move our high schools forward. So the bottom line here is, this -- 00058 03/24/03 - Committee of the Whole despite the tough decisions that we've had to make budgetarily, this budget is lean and mean. It jettisons what we don't need, and it puts money into the areas where we do need the resources. Because we will continue to make progress on public safety. We will continue to phase in our Capital Program, as we have articulated to you and as we've laid out to you. We will significantly expand early childhood. We will make the curriculum instructional reforms that we have promised, along with the after school extended day care programs, and the professional development, and the more time on task that needs to be done, and we will reduce class size which is long overdue.
To accommodate -- And we will do the type of recruitment and retention that the system needs to do to ensure that we have a quality work force. Let me also point out that we've reached an understanding with the teachers union that will allow us to close the door on movement of teachers from one school to another at the end of June. 00059 03/24/03 - Committee of the Whole In the past, seniority impacts school placements of teachers and personnel well into August. Well, beginning this year, the window is going to close June 30th, which means at the end of June 30th, when we have identified teachers, we'll be able to tell the teachers what school they're going to, what class they're going to be teaching, and what subject they're going to be teaching. 50 percent of the teachers who entered our system last year didn't know the school they were going to be in until the last week of summer or the first week of the school year. And 66 percent of them had no orientation or prior training before they entered the system. That's going to change like that. In addition, we are going to end leveling, so there will be no adjustments in school budgets in October. In other words, schools will not lose this one teacher or two teachers, forcing a changing of all the school rosters. So what this is going do is, this is going to allow our teachers, our new teachers, to 00060 03/24/03 - Committee of the Whole know what school they're going to go to, and be reasonably secure in the knowledge that they're going to have that school, and come October, they're not going to be told, well, that position isn't there, you're going to have to go somewhere else. So this budget finances those initiatives. Now, it doesn't finance the initiatives without some pain. We're going to continue to reduce the size of administrative -- of our administrative positions. As we mentioned, while we're going to be hiring hundreds of new teachers, we are going to be phasing out -- and through attrition, and in some cases eliminating a number of the part-time positions that are in the schools. We are going to be eliminating other positions in the schools that we feel do not directly impact the educational process. And we've articulated what some of those positions are. There are a number of municipal positions, services that we carry, that are also going to be on our elimination list. And we're going to be doing some shifting of positions to the bonds, I think about 00061 03/24/03 - Committee of the Whole 38 of those positions. Because of the size of the school construction bond program, we're going to be -- a number of our maintenance and repair people are going to be working on longer-term projects, so we feel we can certainly justify shifting those positions and those expenses to the bond. But all told, there is going to be a net reduction in personnel in this School District to the tune of 373. But that 373, in that number is going to -- also is going to include a significant increase in the number of teaching positions. Normally, what would happen in this school system, because of the expansion of charters and because of the decline in the system's enrollment, is this system would normally lose about 220 teachers just through attrition or just due to the fact that the student population declined, and more teachers and more students are shifting to the Charters. But what's going to happen here is, that's going to be offset by the need to hire 593 teachers to fulfill our class size reduction 00062 03/24/03 - Committee of the Whole initiatives. So there is going to be a need for 593 classroom teachers because of our class size reduction initiatives. So there will be a net increase in the number of teachers of 374. That's the net increase, minus the teachers who would have attrited out because of enrollment reductions.
So we are going to be hiring more teachers than ever before, and you're going to see the type of class size reduction that you've always talked about seeing in the School District, and that we've always talked about wanting but we have not seen in many, many years. Now, the budget the way it is sets the stage for the state. Because this budget is based on the first Rendell budget, because this budget hits the goals in year two of our financial plan, while at the same time funding our public safety initiatives, our school construction and repair initiatives, our education initiatives, like expanded early childhood, and curriculum instruction reforms, high school redesign, the phasing out of the middle schools, the after school extended day programs, and class size 00063 03/24/03 - Committee of the Whole reduction programs. Because those things are happening, it sets the stage for -- In the event that the Rendell Administration is successful in getting their budget through or some facsimile of the budget proposal that they will be making in the next couple days, we will be able to use those additional revenues, and we will be able to put even more revenues in the classroom, for even more class size reduction, for even larger after school extended day programs, for even larger early childhood program expansions. And we will be able to use those resources to help address the long-term structural needs, structural deficit problems that this District is going to face in 2008 and beyond. I'll bring my comments to a close. I appreciate your indulgence, and I'll turn it over to Mike Harris.
Good morning, Mr. Harris. Please identify yourself for the record and proceed with your testimony.
Thank you. Good morning, Council President Verna, Councilwoman 00064 03/24/03 - Committee of the Whole Miller, and other distinguished City Council Members. Thank you for this opportunity to share with you the financial status of the School District of Philadelphia. The SRC could have brought in many CEOs who would have just attacked the District's structural deficit. However, Mr. Vallas was hired to evolve, advance and better the School District of Philadelphia while we also attempt to bring the finances into balance. And this is my charge. And as difficult as it is to hold to this commitment as we prepare this budget, I do believe the District has found a way in difficult economic times to adhere to the five-year plan that was laid out last summer. But before I begin to talk about next year's budget, I must applaud the efforts of City Council, the City of Philadelphia and the Commonwealth of Pennsylvania for their financial help during the past year. The City's help in securing $317 million in deficit financing, its 00065 03/24/03 - Committee of the Whole $45 million grant, and the Commonwealth's $75 million in additional funding could not have come at a more critical time for the District. And your understanding of the District's precarious financial position and subsequent dedicated revenues have helped stave off possible long-term economic damage to both the District and educational opportunities for Philadelphia's children. And even though it was not me who was here last year to ask for your help, I do thank you in your regards to this effort. In the past year the District has gone through many structural and cultural changes involving the SRC, the appointment of Mr. Vallas, the new management personnel, and initiatives at all levels of the organization. And this change has yielded a window of opportunity through which the District can realize its greatness. And the District's Finance Department is working hard, very hard, to do its part to make these possibilities a reality. In August of 2002, the District put 00066 03/24/03 - Committee of the Whole forth a five-year financial plan that began the work of advancing school and program initiatives while also dealing with the structural deficit that we have inherited. 6 million for 2004 as was projected in August. Frankly, this is no small accomplishment, considering that revenues have come in somewhat lower than projected, health care costs continue to advance at five to seven times higher than the CPI. And this Administration has continued its commitment to identify funding for the District's priorities for positive change. The District was negatively affected by the initial budget of the Commonwealth of Pennsylvania, the initial proposal, as were many other districts across the state. We certainly understand that the Governor and his staff were in a extremely difficult and unenviable position of trying to erase a structural deficit of their own. 5 million. Freezing the Charter School formula was a cost of $8 million. After school literacy cut costs by $4 million -- or cut revenues by $4 million. 8 million. All told, the state cuts left the School District of Philadelphia with $65 million in additional cuts that needed to be identified in order to maintain the goals outlined in our five-year plan. Again, I would point that this is compared to the plan that was laid out. 2. All told, these combined cuts accounted for budget savings of $64 million. At the same time, the District has made every effort to cut expenditures. We are also working to identify funding for the 00068 03/24/03 - Committee of the Whole District's priorities for positive change through new and continued initiatives. 2 for enhanced public safety, and $2 million for early childhood and cradle of the classroom. 2 million for expanded summer school that will be funded through the empowerment grant secured under the leadership of Senator Arlen Spector.
The School District of Philadelphia has undertaken a plan that will positively change the educational opportunities of the children of the city for decades to come. But this plan costs money, and in these challenging economic times, your support is needed perhaps more than ever. This budget represents an effort to continue the advancement towards balanced budgets and enhanced programs. And I look forward to continuing the solid and productive working relationship that the 00069 03/24/03 - Committee of the Whole District and the City have begun. And on behalf of myself, my staff, and the School District, I thank you for this opportunity to present our 2004 financial year budget.
Thank you, Mr. Harris. Maybe you should remain at the table, Mr. Vallas. And I guess Mr. Nevels could also come up. Every Council Person wants to be recognized. The Chair of the Committee and I have decided we're going for the first go around, each Councilperson will have five minutes. Mr. Vallas?
Did I understand you to mention that the Parking Authority will be providing bond capacity to the School Districts? Would you give us the specifics of this initiative?
Sure. Well, first of all, we haven't finalized the initiative yet. But as part of the curriculum and instructional reforms, as I mentioned, there is a lot of money 00070 03/24/03 - Committee of the Whole that the District already spends that it needs to spend better. And we have been able to secure upwards to... well, $9.6 million a year in reading grants, and $4.5 million in early childhood grant, other funds, obviously to help finance our initiatives. But any time you're going to revamp and change the curriculum around, there's going to be some up-front costs. So our plan here is to borrow in order to replace all of the obsolete textbooks. It's going to be a one-time investment that we'll just in the out years have to maintain; but obviously, the one time costs will be one time. And then we have enough money to maintain the curriculum materials that we've brought. So now, in our discussions with the Parking Authority, to address this issue of the Parking Authority's commitment or promise to the School District, what we suggested to them is that if we're going to go out there and we're going to borrow to secure enough funding to do a massive 00071 03/24/03 - Committee of the Whole initial purchase of new curriculum and instructional materials, if they could provide us with an allocation or a dedicated revenue stream, or if they just made a commitment via intergovernmental agreement to provide us with a specific amount of revenues every year, we could use those revenues to offset our borrowing costs. Now, we haven't finalized the proposal yet. And obviously, any proposal we will finalize we will bring to Council and we will discuss with Council. But the they've made a commitment that that will provide us with an allocation every year. And we feel that we can use that allocation to finance the borrowing that we will have to do one way or another --
Mr. Vallas, I'm somewhat confused on that, because I thought that the City would be getting the money, not the School District. I mean, I just don't understand the specifics of all this. And I don't know how that could happen without coming to the City first.
Well, I'm not so sure 00072 03/24/03 - Committee of the Whole that we won't have to come to the City. I'm just... In my conversations with all parties, the -- consistently I've been told that the Parking Authority made a commitment to the school district. And knowing full well that the Parking Authority doesn't have the money to give the School District $40 million to $45 million or $35 million, whatever that amount is, we came out with a way -- we came up with a way in our conversations with both the Chairman of the Board of the Parking Authority, a way that they could meet that commitment, and obviously it could benefit the School District. Now, we haven't finalized any agreement. It's simply a proposal. And once that proposal's finalized, you know, I'm sure I'll be told what the next process is for getting that proposal approved. But right now it's a commitment that they're willing to make, but we have not finalized, just like this budget has not been finalized. We have not finalized --
Well, it's 00073 03/24/03 - Committee of the Whole certainly not finalized, sir. And we'll be having, I'm sure, several more --
I'm sure. But let me point out that we spend about $20 million on textbook purchases a year, which believe it or not, is a considerable amount of money. And that doesn't include all the discretionary money that's spent on textbooks. It's just not spent right. And it's just not spent well. And when you're doing 6,000 different things, no wonder. Our plan, had we not been able to secure an outside funding stream, was to dedicate a small portion of that funding stream, maybe $2 million a year or $3 million a year, to finance a borrowing so that we can do massive purchases in a single year. Our preference, obviously, is to secure another revenue source. And we certainly saw the Parking Authority as one option. But once again, we haven't finalized 00074 03/24/03 - Committee of the Whole anything. It's a proposal that's out there. You know, we try to look for constructive solutions, particularly when it involves commitments that either were made or whatever the context was of those commitments being made to the School District. And I'm sure we'll have an opportunity to have several discussions on that before it's resolved.
Mr. Vallas, on -1 of your detailed budget I see that for FY '04 you do not have any appropriations for the Board of Revision of Taxes.
Yes. We have not included an appropriation for that item in the budget. I directed our finance people to identify initiatives, to identify programs, to identify positions that we felt did not impact on the classroom, either directly or indirectly. And I said that given the initial budget proposals coming out of Harrisburg, those positions should not be in the budget.
But if we 00075 03/24/03 - Committee of the Whole don't have anybody doing the assessments, how do we generate more money for the schools?
Well, I could certainly have a conversation about those positions or how many of those positions are actually, you know, positions where things are getting done. But I'll defer that conversation to, you know, obviously another time. But the bottom line is, it's not -- the School District isn't mandated. Those positions were transferred to the budget a number of years ago, I believe, when the School District had available resources and the City did not. Those positions -- the School District doesn't have any control over those positions. The School District can't manage those positions. The School District can't make sure if the people in those positions are basically showing up every day and doing the work that they need to do in those positions. So there's just -- the School District just doesn't have any accountability over those positions. Now, you know, if it's an issue of the City contributing financially to the financing 00076 03/24/03 - Committee of the Whole of those positions, I'm sure that's something that --
Mr. Vallas, have you had any conversation at all with Mr. Glancey at the BRT?
Well, I think there should be some conversation to ascertain exactly what these employees do...
...and what their responsibilities are. Do they generate monies for the School District? And if we don't fill those positions, what happens? As I said, I think every Member wants to be recognized. I have a number of questions, but I would like to give everybody the opportunity to be recognized. Councilwoman Miller.
Thank you, Madam President. I'm just going to ask a couple questions. I have more. 00077 03/24/03 - Committee of the Whole
Do you have -- Mr. Nevels, or Mr. Vallas, is there currently a listing or directory of how the District is now structured? You talk about a couple new departments, like the Office of Accountability, the Office of Community Relations. Because of so many changes, it would help us if we had a copy of an organizational chart.
Phone numbers, directory or whatever it is that you have that you're operating from.
Okay. Thank you. And one other question for now. It appears that lots of what you're talking about today, and just in terms of laying out goals...
...structured around the No Child Left Behind legislation, can the School District give us something written that 00078 03/24/03 - Committee of the Whole tells us how you're fitting in or how you have fit in to the original piece of legislation --
-- the goals, objectives, you know, where you're doing well, what areas you need to improve on?
Yes. Absolutely. And if I can just take just two minutes, but we will provide you with the information. In fact, I believe in the packet -- and if it's not in the packet, I'll make sure that it is -- we've laid out a chart that identifies the four major areas of No Child Left Behind. It's school choice. It's providing support for children in schools who do not have choice. It is dealing with school management issues when schools are chronically failing. And it's teacher recruitment and retention. And I have really kind of touched in my presentation on all those initiatives. Our school choice initiatives, not only are we following No Child Left Behind by identifying spots in performing schools and giving children the option of moving to those spots, but we're 00079 03/24/03 - Committee of the Whole also creating school choice options. The move towards more magnet schools. They're putting magnet programs in neighborhood schools. Our charter school system. It's very consistent with No Child Left Behind. On the whole -- On part two of No 8 Child Left Behind, the Moore services for children who are underperforming, our after school and summer school programs are completely in line with level two or phase two of No Child Left Behind. Phase three, which is management. The changing of management for failing schools. I like to think we've changed management with a vengeance here. You have privately managed schools, your charter school conversions, your reconstituted schools, all very consistent with No 18 Child Left Behind. And finally, the plan for recruitment and retention, which basically says that by such and such a year all teachers have to be certified and all support staff have to be certified. I've articulated what we're doing in the area of recruitment and retention. So we are 00080 03/24/03 - Committee of the Whole pursuing -- we are pursuing the goals set by No 3 Child Left Behind. We're fine tuning them so that they meet our education priorities. But the goals our pretty consistent with our goals. And I think because of that, we've been able to secure additional funds. We've been able to secure additional resources for our programs. But I will provide you -- If the memo isn't in there, I'll get you the memo by the end of the day, on our note, the memo we provided to the Department of Education on our compliance with the No Child Left Behind Act.
Okay. And one more just short note. When you're thinking about school choice and giving children the option for magnets and high school, I think what you really need to also remember is that -- or if you don't know, I'm sure some of your members know -- there are many, many children that applied to Masterman.
And we could probably use an additional school, elementary school, like Masterman -- 00081 03/24/03 - Committee of the Whole
Yes. And let me point out that with the -- Masterman, of course, has about 400, 450 students in the high school, but they have about 700 students in the middle school. And as you know, we've talked about obviously creating a number of new magnet high schools or open enrollment high schools, but also magnetizing the neighborhood high schools by putting exemplary programs and honors and advanced placement programs in those neighborhood schools. But we're also talking about putting what we call exemplary programs or AP Prep programs in the elementary schools. Because right now, I mean, if we do what needs to be done in our elementary schools in our -- for the middle grade years, we won't have lines forming outside Masterman. But I will tell you specifically to Masterman is, as you know, we're planning on building a new Franklin Learning Center. And we're in -- We have a site, but we're looking for 00082 03/24/03 - Committee of the Whole perhaps a larger site. But one of the things that has been put out is the possibility of using the old Franklin Learning Center, which is only four blocks away from Masterman, as a potential site for another what they magnet school middle grades program. And that's something that my staff has presented to me as an option. And I'll be more than happy to discuss it with you. But your goal is right. We need more options. You know, we have, what? A half a dozen magnet high schools, legitimate. But we have very few magnet elementary schools, and we need to create more options.
I would like to 00083 03/24/03 - Committee of the Whole devote my first five minutes to the standardized curriculum that we discussed, and refer to an article that was just in Sunday's Inquirer around the School District moving to a central lesson plan.
You've outlined very well for me, at least, the factors that drove you to the decision to have a standardized curriculum. I'm curious to know what accommodations, what considerations, what kind of thinking went into considering those high performing schools, schools that were operating above the standardized level --
-- and which suggest strong principles and the like. What kind of consideration at all was given to those schools, as relates to the infusion of the standardized curriculum?
Well, for the magnet schools, for the high performing open enrollment schools, we will most likely exempt from the 00084 03/24/03 - Committee of the Whole standardized curriculum. All the schools have to meet our goals, our objectives. All the schools have to meet our standards. But the handful of high performing schools we have, you know, would be exempted. The schools that would be exempted from the standardized curriculum are the privately managed schools, because we can't dictate to them, although we will certainty hold them accountable for academic performance or non-academic performance. The charter schools, of course, are not required. We could note mandate that the charter schools use the standardized curriculum. And then of course, the magnet schools, like the Mastermans or the Cappas or the Centrals, or the Girls High. Those schools would probably be exempted. But there's only 20 schools which by Federal Government's definition do not -- are considered to be schools that are improving enough not to be on the No Child Left Behind list, so to speak, and -- 00085 03/24/03 - Committee of the Whole
So I would say that there's -- many of those schools would be allowed to stay with their own curriculum plans.
But that will leave about 200 -- and I would say about 220 schools using the structured curriculum. I would also say this: We are going to make the curriculum instructional models, though, available, and the professional development available to all the schools --
-- whether they're privately managed or Charters, because the curriculum selections -- these are top notch curriculum instructional models, which have the full support of -- you know, of the Federal Government. We wouldn't have gotten the $9.6 00086 03/24/03 - Committee of the Whole million reading grant had we picked the reading curriculum that they disapproved of. But we will provide that support even to schools that are not mandated under the law to use our curriculum models.
Okay. My second question in this area: You mentioned in your testimony that you have identified at least 322 academic courses that are, and I use your word, not relevant.
Given that the ethnic makeup of the Philadelphia public school system, and what are we doing in that area about African-American studies?
Sure. Well, let me respond -- And once again, indulge me a bit as I can go through details. And we will provide you with an addendum to our curriculum instruction materials we put out last week. You should have gotten it 00087 03/24/03 - Committee of the Whole all already. But just in case you didn't, we will provide another copy, that lays out how we're going to address the issue of multi-culturalism in the curriculum. And I think you'll be pleased. First is the following. And you have to understand, because there's no -- You can have a high quality curriculum and a multi-cultural curriculum. Anybody who thinks that -- It's like saying that you can't have MBE-WBE and have quality school construction. When we expanded our MBE-WBE program in Chicago, the prices of our schools went down and the construction got better because we had competition. So, I see both as part of the same thing. You can't have a quality curriculum that isn't a multi-cultural curriculum. But while the curriculum models that we've selected, like hardcore trophies, are superior curriculum models, they were also selected because these are curriculum models that are multi-cultural. And the reading materials that are selected to support the hardcore trophies 00088 03/24/03 - Committee of the Whole curriculum are multi-cultural materials. We have a task force that we've put together. There is a part of that task force includes a number of scholars from the African-American community, and elsewhere, to focus on this issue of multi-culturalism. It's not that I'm going to make everybody happy like that. But the bottom line here is, the curriculum models that we've selected were selected in part because they lend themselves to multi-culturalism. In addition to that, the curriculum supplements that we're selecting, like, we're going to allow the Hundred Books Challenge and the Greats Books to be used as a reading supplement -- not substitute --
-- but supplement, because they are superior models. Though what we've told the Hundred Books Challenge and what we've told the Great Books is: Look, you know, Western European authors should not be the exclusive authors of the books in the Hundred Book Challenge or the Great 00089 03/24/03 - Committee of the Whole Books.
So what we've told them is, they have got to -- they have got to work to make sure that their programs, which are very effective in schools where they're run well are -- their programs are multi-cultural. And they're going to have to meet our standards. In addition to this, the professional development, because it's just not multi-culturalism, it's also pedagogy. It's fine to have, you know, multi-culturalism immersed into your curriculum. But as Sandra Dungee Glenn always says, if the teachers don't know how to teach in an urban classroom, then they're not going to accomplish anything. The year-around professional development is going to be focused on the following: Contin area, instructional methods, which includes teaching teachers about the most effective instructional approaches in inner city schools, technology, and classroom management. So all of the teachers that come in, 00090 03/24/03 - Committee of the Whole both existing teachers that go through the professional development training and re-training, and, most importantly, the new teachers that enter in the system are going to be acclimated to the classroom. Because, you know, when you hire 600 or 700 teachers, and 66 percent of the teachers, half of them don't know what classroom they're going to have until the second week or first week of school, and two-thirds of them haven't had any prep before they've entered school -- you know, we can't assume that the colleges of education are really equipping them for the classroom -- you've got a real problem. So it's not only about the curriculum instructional materials, but it is also -- it is also about the training. And then finally, as part of the high school redesign, as part of our clean-up of the high school curriculum, we are going to provide quality courses, like African history courses, you know, African American history courses, like courses -- like courses about great civilizations, Asian history courses, Latin American history courses. 00091 03/24/03 - Committee of the Whole We are going to develop those courses, and those courses are going to be part of the permanent high school curriculum. So that's the approach that we're taking. Now, we are -- It will be at least a couple years. Our focus right now is on reading and math, and to begin to get --
-- some of the multi-cultural courses obviously developed. But we will not be -- We will not have the social studies curriculum models complete probably for another year. It's just a question of how much can we absorb all at once. But we will address this issue, and I think we'll address this issue in a very aggressive way.
Councilwoman, I'm sorry. Your time was up some time ago.
By September 2003 the curriculum models will be in place. And the 00092 03/24/03 - Committee of the Whole curriculum models will be multi-cultural, particularly the reading and literacy curriculum models. In terms of the course work development, I don't know what the time line is. The objective is to get those courses developed as quickly as possible. But hopefully, they'll be part of the high school curriculum come September. But there may be a year delay in that because you want to have developed quality courses. You don't want to replace some of the, you know, let's just say meaningless courses with courses that are not -- that don't -- that are not of quality. And if you're going to -- But our goal is to expedite that as quickly as possible.
You're welcome. The Chair recognizes Councilman Kenney.
Thank you, Madam President. 00093 03/24/03 - Committee of the Whole Mr. Vallas and your staff, I want to thank you for the opportunity I've had over the last number of months to have actually people from the School District come to my office and ask me what I think, which is a new experience for me. And I'd like to thank you for that. The issues that Council President Verna raised and that her questioning relative to the BRT and some other things, the Parking Authority, I really do think these are things that with the right discussion and conversation and cooperation, we could work these things out, to everyone's benefit. The thing I would caution you on -- And this is something that I've experienced as a native Philadelphian. You are going to find people who are going to try to nitpick you to death, who are going to try to put a little roadblock up here or there, or a land mine here or there. And the reason I think that that happens is because you're coming here with a lot of new different ideas which to me make a lot of sense, on discipline, on curriculum, on 00094 03/24/03 - Committee of the Whole facilities, on other types of things that really weren't addressed in a very comprehensive way. If you're successful, you're going to prove the last or years of what we've 6 been going through wrong. So there's going to be 7 people who are really going to have a need to make 8 sure that you don't succeed. 9 But I would say to you, don't stop 10 thinking outside the box. Don't stop the 11 enthusiasm. Don't stop the new ideas. Don't stop 12 trying to bring some reasonable approaches to 13 educating our kids in this City, because it's an 14 exciting time, I think, in this city right now. 15 And I want to commend you for your 16 enthusiasm and for really your desire to make a 17 big difference and not keep things the status quo. 18
So we may have 20 fights as time goes on. You may get beat up in here from time to time. You may get beat up in the press from time. But if you stick your eyes on the prize, I think at the end we're all going to be a better City for it. One of the things you've talked 00095 03/24/03 - Committee of the Whole about which was a step-child in the last Administration was the magnet schools. I think the magnet schools offer us an opportunity to give our children, as you said in your testimony, a choice.
When it comes to an eighth grader and their parents making a decision on what to do. In the last Administration, magnet schools were treated as step-children. The acceptance standards were: We were having lotteries for magnet schools, which is totally insane. But those kinds of things, I think, make a difference. One of the things on your ability to reform the finances of the District and to stay afloat, I read in the paper some issues relative to disability reform, the use of disability, and the way the disability claims and other things are managed in the system. Could you be a little more expansive on what's being changed, and how much we're going to save now and into the future? 00096 03/24/03 - Committee of the Whole
Sure. I'm going to turn that question over to Mike. But let me respond to some general comments you made at the beginning. My commitment to the Council is, any amendments that we make to the Council on this budget, we will be more than happy to come back to the Council and have a hearing on those changes. This budget by no means is in any way to be characterized as a throwing down the gauntlet. We felt that we -- We have a tremendous opportunity here in a very short period of time to restructure not only the way we've done business in the schools but where the resources have gotten. Just imagine -- Just imagine system-wide class size reduction. Just imagine institutionalized after school extended day programs. Just imagine not only magnet schools, but magnet programs in neighborhood schools. And if the Governor's successful with his initiatives, as we pray he is, it means not only are these programs going to be sustained, you know, for 10 or 15 years, but it also means 00097 03/24/03 - Committee of the Whole that the long-term structural problems that this District has faced financially are also going to be corrected.
Rest assured, we will be back here. Any major amendments that we will make to the budget, we'll be more than happy to set up the same formal presentation to talk to you about our recommendations. Okay.
I think if you're talking about how we're going to handle workers' compensation --
We think it's an area that we have a lot of room to improve in. And we've got a strategy laid out by which we're going to do that. First of all, we did bring in a consulting firm who has helped us lay out and 00098 03/24/03 - Committee of the Whole mapped out a strategy for us, and we're down the path of doing that. We have -- Currently, the biggest thing we've done to date is, we've released an RFP for the third-party administrator. We felt strongly that while we will not -- I can't comment one way or the other on our current TPA, we think that we need to go outside and at least test the market and see who's out there. The City just went through the same process, I understand a six-month process or so, to do that. But we have -- Right now on the street is an RFP to look at third-party administrator work. Also, we are going to release a worker safety and absence management proposal -- request for proposals that should be out this week. It should have been out today, actually, if not tomorrow. And it will be to bring in basically a safety loss program that is currently not in place at the District. We are in the process of working with our Law Department, our Human Relations 00099 03/24/03 - Committee of the Whole Department to get a light-duty program. The District does not have a light-duty return to work program. It is allowable but has not been developed before we got in. So it is a cumbersome process. You have to go through a lot of work on that front. But we are dedicated to that --
So you can't associate any numbers at this point. I mean, projected savings or --
Yeah, yeah. I'm sorry. I'm sorry. Yes, we can. We expect to save about $4 million in workers' compensation claims over the coming year. Currently, we spend approximately $20 million a year on workers' compensation claims. So our goals, modest goals, we feel are to save at least $4 million. We expect we'll be better than that.
Councilman, if I could follow up, I want to thank you again for your support. And I also started out in my comments, what a difference a year makes. And I also want to thank everyone in attendance here on Council. 00100 03/24/03 - Committee of the Whole But specifically, one thing I would like to address is that as the Chairman of the School Reform Commission, we committed ourselves to providing information and speaking directly and candidly with you. And please, please keep in mind that just because it's written on a budget sheet doesn't mean that we're not going to have conversations with you. You are going to hear plenty from this gentleman and the other gentleman at the end. And just as we set the stage last year for ongoing conversations, those are going to continue.
Councilman Kenney, your time is up, sir. At this time, this hearing is going to go into a recess until 1:30. Thank you. (A luncheon recess was taken from 11:30 a.m. to 1:45 p.m.)
The Committee of the Whole is now back in session. And the Chair recognizes Councilman Nutter. 00101 03/24/03 - Committee of the Whole
Thank you, Madam Chair. Madam Chair, is this a continuation of my original point of order from earlier today or is this an actual questioning round? Because I actually was not finished that point of order. So is this a continuation of that or is this an actual round of questioning?
Thank you, Madam Chair. Good afternoon, Chairman Nevels, Mr. Vallas, Mr. Harris.
Let me ask... We received on Friday a series of documents and testimony, one of which was what we generally refer to on the City side as the big book. Fortunately, you guys only have one; the City has two. And I received FY 2004 Proposed Budget Executive Summary. And then this morning 00102 03/24/03 - Committee of the Whole at the hearing we received a second copy of an Executive Summary. This one has down at the bottom a revised March 24, 2003 date on it. Now, which of these documents are we working from?
Councilman, the one we delivered to you this morning is the corrected version. The one we delivered to you on Friday, unfortunately, contained some --
Unfortunately, the copy we delivered on Friday, we recognized contained some typos and other issues. The basic material inside was consistent, but we wanted to give you a corrected copy. And we do apologize for that, but understand that you... Thank you for accepting it.
All right. So our situation now is, we received a document on Friday which we read through, and now we have a new document this morning that has changed numbers in it; is that correct?
Most of the changes are 00103 03/24/03 - Committee of the Whole for this year's budget are, for all practical purposes, minor in nature. So the desire here was to get a draft out on Friday in everyone's hands, and then to have a final clean-up draft today. So I don't think the numbers are -- at least the numbers for this budget year, are different.
No. There's some additional material in there today, but the core numbers regarding the five-year plan, there was a typo in the second five-year plan that we have just corrected and some other typos in the narrative manner, so...
I don't know. Councilman, are you looking at what we received today, the differences on page, I believe it's, what, 2?
And if you then refer back to , the documents are 00104 03/24/03 - Committee of the Whole totally different.
Yes. Well, I had noticed that, Madam Chair. So, Mr. Harris, I believe, characterized them as minor changes or typos. I'm left with the impression that we're actually talking about a few million dollars. And I think only the Federal Government talks about millions of dollars as a typo.
No, Councilman. I mean no disrespect or flippancy by my comment. I simply -- And I don't have the Friday copy in front of me, since we've been working to correct it and clean up the one that's in front of you, which I feel very strongly is accurate.
If you'd like me to explain the difference, Councilman, I would have to see it.
I would greatly appreciate that. He needs a copy of this document. 00105 03/24/03 - Committee of the Whole Mr. Harris, what I'm looking at is of the Friday document compared to of the document from today. The first... No. Actually, now I need a copy of the old document. The first thing I notice is that for FY '04, I believe the document from Friday for the expenditure reduction column had a total of $164.2 million, and today that document, the new documents, says, $112.5 million. Could you explain what the difference is?
Yes, Councilman. I see the difference now, and I do understand what happened. And again, I can't apologize enough. But the FY -- On the first five-year plan from 2003 to 2007, the FY '04 column is... in the document you have in front of you today, is the reflection of the original five-year plan. What you got on Friday was the first year -- on that page, was the first year of the revised five-year plan. If you would go back and look at the second five-year plan going from '04 to 08, if you look at the '04, the FY '04 column, that -- 00106 03/24/03 - Committee of the Whole basically that is the new --
Well, that makes reference back to the $164.2 million.
Councilman, what happened was, we laid out, in the first one in the package that goes from '03 to '07. In the package you got Friday, the FY '04 column was wrong because it was not from the original five-year plan. What the '04-'08 you have now is basically -- It was a transposed -- The wrong column got put in the wrong spreadsheet. And so what you saw on the first five-year plan basically was actually the revised plan for '04-08.
Mr. Harris, I think what I'm trying to understand is, on 00107 03/24/03 - Committee of the Whole in the new document dated today, for expenditure reduction in the FY '04 column, you now have on , $112.5 million. On of today's document for FY '04 for expenditure reduction, you have $164.2 million, which is what the document said on Friday. So what I'm now trying to figure out is the difference between the Friday document, this morning's document on , and today's document on . Why do the numbers keep changing in that column?
The numbers changed, Councilman, because I put the wrong column in the wrong spreadsheet on Friday. And I do apologize.
is the original five-year plan for '03 through '07, laid out last August --
-- or last September. What is part of this package, in going forward as a five-year plan, we wanted to 00108 03/24/03 - Committee of the Whole lay out a new five-year plan. The which is the five-year plan '04 to 08 --
-- basically, the FY '04 column is a revision to the original plan, and the spreadsheet is a revision to the five-year plan that lays out and ties to the budget, so --
All right. I appreciate the apology. Why don't we say this. And you tell me if I'm wrong. You're telling us now that on the new document for today...
...that represents the five-year plan that you laid out back in September of 2002.
And that 00109 03/24/03 - Committee of the Whole represents a new five-year plan, also changing and recognizing a new budget year.
Or budget period '04 to 08, and that's what represents.
That's correct. And I would also, if I may add, that the number that you see jump from the 112 in expenditure reductions to the 164 in expenditure reductions is reflective of the matter brought up earlier, which is, this document is reflective of the Commonwealth's budget as we knew it at the time of publishing this document. So therefore to adjust to that, we did need to increase our expenditure reductions.
To maintain the same revised deficit balance that we had intended to lay out in our first plan, so...
Okay. Well, let me ask you this question: I mean, the , five-year plan, the March '03 five-year revised five-year plan reflects the state budget as we know it today, and your best assumptions, and your 00110 03/24/03 - Committee of the Whole best effort to lay out this is what could happen if this budget happens?