2556 COUNCIL OF THE CITY OF PHILADELPHIA BEFORE THE COMMITTEE OF THE WHOLE OPERATING BUDGET HEARINGS - SCHOOL DISTRICT - - - Room 400, City Hall Philadelphia, Pennsylvania Monday, March 6, 2000 10:00 a.m. - - - BILL 7 - Authorizing the Board of Education of the School District of Philadelphia to impose a tax on real estate within the City of Philadelphia. Bill 8 - Further authorizing the Board of Education to impose a tax on the use or occupancy of real estate within the School District of Philadelphia. Bill 9 - Further authorizing the Board of Education to impose a tax on net income from real property, tangible, and intangible of property of residents of the School District of Philadelphia. PRESENT: COUNCIL PRESIDENT ANNA C. VERNA, Chair COUNCILWOMAN JANNIE L. BLACKWELL COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN DARRELL L. CLARKE COUNCILMAN DAVID COHEN COUNCILMAN W. WILSON GOODE, JR. COUNCILMAN JAMES F. KENNEY COUNCILMAN W. THACHER LONGSTRETH COUNCILWOMAN DONNA REED MILLER COUNCILMAN MICHAEL A. NUTTER COUNCILMAN ANGEL L. ORTIZ COUNCILMAN FRANK RIZZO COUNCILWOMAN MARIAN B. TASCO - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2557 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS I N D E X Debra Kahn, Secretary of Education. . . . . . 2559 Pedro Ramos, President. . . . . . . . . . . . 2565 Board of Education Superintendent David Hornbeck . . . . . . . . 2569 2558 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS P R O C E E D I N G S
Good morning, everyone. This is the public hearing of the Committee of the Whole on Bill No.'s 7, and 9. 6 The Chief Clerk will please read the 7 titles of the bills. 8
Bill No. 7, an ordinance amending Chapter 19-1800 of the Philadelphia Code, entitled "School Tax Authorization," by amending Section 19-1801 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. Bill No. 8, an ordinance amending Chapter 19-1800 of the Philadelphia Code, entitled "School Tax Authorization," by amending Section 18 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 No. 9, an ordinance amending Chapter 19-1800 of the Philadelphia Code, entitled "School Tax Authorization," by amending Section 25 19-1804 to further authorize the Board of 2559 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Education of the School District of Philadelphia to impose a tax on the net income from real property and tangible and intangible of property of residents of the School District of Philadelphia.
Thank you. Miss Kahn, I understand you will be the first individual to testify?
Kindly identify yourself for the record and proceed with your testimony.
Good morning, President Verna and Members of City Council. I am Debra Kahn, the Secretary of Education for the City of Philadelphia, and it is a privilege for me to be here this morning on behalf of Mayor Street to lead off the presentation of the School District of Philadelphia's Fiscal Year 2001 Budget. Joining me at the table are the President of the Board of Education, Pedro Ramos; Vice President Dorothy Sumners Rush, and Superintendent David Hornbeck. And all of us are delighted to have in the chamber today the members 2560 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS of the Philadelphia Board of Education, and I would be honored if you would allow me to introduce them to you now.
Sure. Members, please stand to be recognized as your name is called. First, please meet the Student Representative to the Board of Education, Jason Kleinman, who is a senior at George Washington High School. And now the seven newly-appointed members of the Board are: Mr. Martin Bednarek, Reverend Ralph Blanks, Miss Helen Cunningham, Miss Sandra Dungee Glenn, Miss Christine James-Brown, Mr. Michael Masch, And Dr. Emilio Matticoli, the Board of Education. (Applause.)
These special citizens of Philadelphia were recommended by the Educational 2561 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Nominating Panel and appointed just last week by Mayor Street, pursuant to the expanded authority that the voters granted to the Mayor in the November election. Mayor Street has wholeheartedly embraced the challenge to assume greater responsibility for the School District. And these women and men, with their dedication to children and their broad range of skills and experience, will provide invaluable service to this city as we work together to reach the goal of providing the opportunity for every Philadelphia child to attend a first-quality public school. " For those of us who toil in the field of public education and believe in its possibilities to raise children to terrific heights, the times are interesting indeed. In the first instance, we are fortunate to have the Mayor of our city who has unmistakenly placed children and their rights to receive a quality public education at the top of his priority list. It is a priority that we know is 2562 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS shared by Members of this Council, and it is why we want to work in partnership with you, to help forge solutions to problems that confront us in these interesting times. Let us be clear: More than 213,000 of Philadelphia's children attend a public school system that, despite enormous obstacles and continuing problems, has documented significant progress in student achievement over the past several years yet is also a system that remains undervalued by far too many people who matter. The progress that has been achieved is the result of very hard by School District employees, students, and their families. It is also the result of financial investments that the District has made for services that students and teachers need. The School District has demonstrated that sound spending can lead to improved educational performance. But unless we obtain sufficient funding to operate our public schools, continue improvement, which is so necessary, will be threatened. The situation here is not unique in Pennsylvania. The chronic and now critical 2563 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS funding shortages faced by the Philadelphia School District are increasing being recognized as problems that exist statewide. Suburban, rural, and small city communities are feeling the squeeze of trying to support quality public schools through too much reliance on local tax dollars. It is in this context that the Street Administration and the School District are attempting to serve the school children and families of Philadelphia by reaching out, by speaking openly and thoughtfully about the difficulties we face and by listening to new ideas in the search for real and responsible solutions. We will continue our advocacy on behalf of the children who, if provided with quality education now, will most assuredly produce better futures for all Philadelphians. But we will also make every effort to find common ground with those who can help. That is why we're encouraged by the Mayor's meeting with Governor Ridge last month and why we are continuing to take steps to discuss our mutual interests. ), will be coming to Philadelphia this Friday. Together, we'll be visiting the schools, and afterwards, we'll meet to talk about ways in which we can work together to help our children and our schools. And that's why we are pleased with the growing participation and enthusiasm being generated night after night among the teachers, administrators, parents, and students who have been attending the Mayor's cluster meetings. If we are going to succeed, everyone must believe and behave as though real change is possible for our schools.
And it is certainly why we are grateful to the President and Members of this Council for your willingness to open the budget dialogue this morning in a manner which is different from years past, a manner perhaps befitting these interesting times. There are two reasons for our need to have an abbreviated budget hearing today. First, you are all aware that the School District has had problems with its new computer system. Those problems have resulted not only payroll errors and delays, which are largely corrected, but also in 2565 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS delays in producing the detailed spending information that is necessary to build an accurate budget. But even more important, the new members of the Board of Education, who were sworn in just on Friday afternoon, have simply not had the opportunity to review the financial status of the School District or to consider various budget options. Yet this Board will have the responsibility of shaping and improving what may well be the difficult budget in the recent history of the School District. Board President Pedro Ramos will now explain how this Board will proceed to carry out its duties in this area, as I thank you once again for your attention and commitment to our children.
Councilwoman Miller and Members of City Council. My name is Pedro Ramos. I am the President of the Board of Education. On behalf my 2566 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS new and returning colleagues on the Board of Education, I thank you for giving us the opportunity to provide you an overview of the fiscal realities facing the School District of Philadelphia and the 213,000 children it serves. First, I want to acknowledge the multifaceted support that Council has provided our children, our schools, and the School District over the last year. We appreciate that partnership and look forward to continuing and building upon it. We also realize that while we all may on occasion differ on the details of how we get there, we also generally share a common goal: to prepare young people with the knowledge and skills repaired for college and the workplace and to provide the foundation upon which they will become lifelong learners in a quickly changing world. The Board of Education knows it has a lot of hard work ahead, but we are focused, committed, and determined to do the best for our children, with your help and support. Today, we are presenting a preliminary lump-sum statement of anticipated revenues and obligations for the 2567 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS upcoming fiscal year ending June 30, 2001 and an explanation of the principles guiding our decision-making process as the new board proceeds to craft its actual budget for the next year. The legislation that would reauthorize current City funding to the School District for next year has already been submitted, and we would, of course, ask for your approval. million. million, with a projected fund balance deficit of $175 million, absent additional revenue enhancements or obligation reductions. " The effect on our Operating Budget of implementing these Fair Opportunities to Learn is that our gap would grow by an additional $155 million to $330 million. You will hear more about the Fair Opportunities to Learn from Superintendent David Hornbeck. The new Board of Education will review and considerate and consider the Fair Opportunities to Learn proposal and apply its judgment as to our ability to move forward. I will ask our new board to be guided by five objectives during our budget deliberations? First, we will not cut school-based services to children; Second, we will make every effort to further maximize the efficiency and productivity of district management and operations; Third, we want to keep schools open and operating; Fourth, we want to make the downpayment on the Fair Opportunities to Learn Program so that 2569 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS we can maintain the high standards for children that we have adopted; Fifth, we will continue to work with the City and State leadership in developing short- and long-term solutions. While our tasks will not be easy, I can assure you that this new Board of Education will roll up its sleeves and go right to work. Finally, I want to note the new amendments to the City Charter for the structure and opportunity for closer collaboration between City Council and the Board of Education. We believe that such collaboration has the potential to be very powerful, and we look forward to it. With your advice and your support, we will continue to push improvements in the City's educational system until we provide the world-class education that our children deserve. Thank you. I'm now pleased to introduce the Superintendent of Schools, David Hornbeck.
Good morning, President Vern and Members of the City Council. In 1994, our School District embarked 2570 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS on a comprehensive systemic strategy for change, called "Children Achieving" -- and they are. Today, we find ourselves in the enviable position of our students having made more academic progress than virtually any other big district in the United States. 5 million extra dollars this year, a nearly 30 percent of all the awards made across the State, even though we only have 12 percent of the students. Our teachers, principals, parents, and students have worked hard, they are beating the odds. Thanks to extra and more effective training for teachers, added supports for pupils, including full-day kindergarten, and administrative cuts yielding savings in management, test scores in reading and mathematics have improved dramatically. And they have improved throughout the City -- in low-income and in higher-income schools and in racially-isolated schools, and in schools where most students are non-native English speakers, and in schools with concentrations of native English speakers. But there is still much 2571 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS to do before we reach the goal of a system that prepares 95 percent of our students to achieve success throughout their lives after graduation, and that's where Fair Opportunities to Learn comes in. In June, 1998, the Board of Education took three wise steps. First, it mandated the end of social promotion for students. Second, it increased graduation and promotion requirements. And then the Board adopted Fair Opportunities to Learn, Philadelphia's plan to close the achievement gap for all of its children. The members of the Board determined that it would be unfair to hold students accountable for demonstrating higher levels of achievement unless students and teachers received the instructional and social supports that give them a fair chance to meet those higher standards. The Fair Opportunities to Learn Plan is anchored in tried and true practices proven successful in improving student learning. It is our road map for delivering the school services that will meet our responsibility to our students and give families even more reason to live in 2572 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Philadelphia. The Fair Opportunities to Learn Plan that I recommended to the previous Board of Education, and which I will recommend to the new board for the 2001 Budget, includes: Quality preschool for additional 4-year-old's and eventually for all 3- and 4-year-olds; Summer programs for grades 3, 4, 7, 8, 9, 10, 11 and 12, and eventually for all grades; Smaller classes to a limit of 17 in kindergarten and the 1st grade, and in the following years for grades 2 and 3; Extra help for children who are struggling academically; Additional support for the development of teacher quality; A nurse in every school; Good libraries and technology; Support for students whose first language is not English; And after-school programs. We don't want more than other districts have. We simply want to give our children their 2573 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS fair chance. We already have made a solid start. We've restored some summer programs last year, after nearly ten years with none: We've established full-day kindergarten and reduced class size for kindergarten and the 1st grade in about 60 schools this year; We've collaborated with other City and private agencies and institutions to offer needed family services to our students; We will continue to increase our savings through better management and to identify savings that can be used in instructional programs. I look forward to working with the new board, under the leadership of Mayor Street and in partnership with City Council, as we address the financial issues of the School District. I know that you, Madam President, and Members of City Council are as committed to education as we are.
You appreciate that our children's best hope for a bright future are schools that work for every one of them. I appreciate your support for our schools' continued overall progress. 2574 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Thank you very much.
Thank you, Mr. Hornbeck. Mr. Hornbeck, can you elaborate, if you will, about the disciplinary school.
Excuse me, President Verna. Before he does that, I just need to clarify for the record that, on behalf of the Mayor, I am also asking for the Council's action on the bills that are before you for reauthorization of the taxes. Thank you.
You're referring to the new school that's been in the news --
Yes. I don't have too much knowledge about that so I would like to you give us any and all information you may have for the record.
I'd be glad to and will be glad to follow up with some additional written material that will lay it out. 2575 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS We became aware of the community education partner school that has been operating the last three years in Houston and in the last couple of years in Dallas through visits that were originally taken there by several members of the State legislature, and I had the opportunity to go down and visit the school in Houston that they are operating for the Houston Independent School District last spring. It is designed to address the needs of seriously disruptive students and youngsters who are two or more grades behind grade level. And in -- surprisingly, in nearly every single case, those two things go together, because we find over the years that the kids who are seriously behind are frequently the youngsters that engage in disruptive activity. And we were really quite impressed, both those legislative leaders that went, and from my own observation, and since then, members of the Board, members of the Philadelphia Federation of Teachers, parents groups, and various groups have gone down to eyeball this thing because it's -- it is a different approach. 2576 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS But it also seems to be, according to evaluations that have been done by people like Diane Ravitch (ph.), who's the former secretary Assistant Secretary of Education for the United States, and based on, for example, Houston Independent School District records about disruption, indicating a percent reduction in 9 violent acts in the School District since they put 10 the CEP Program in place, something that is very 11 much worth exploring. 12 The Board has authorized our beginning 13 to develop a contract with CEP, and we are in 14 negotiations around that contract right now. The 15 parameters that we're looking at at the moment 16 would have about 600 of our youngsters in the 17 school at the opening of school in September, 18 growing over the course of about the first 19 semester to around 1500 kids. 20 And so we are -- that's -- that's at 21 least an overview of both why we're looking at it 22 and the objectives, the results we think that 23 would be achieved if we were to have that same 24 opportunity. 25
Do you anticipate 2577 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS this school being open for September?
We think that if we can complete this process within the next month, that it can be open in the fall.
With that being said, would we be abolishing the able academies?
There would -- we would be using them differently, and some of the kids that have been going to the able academies would be going to this school. Regretfully, there are, in fact, probably, we estimate, 4 or 5, maybe as much as 6,000 of our kids who need the extra help, and so we don't see this as a simple replacement, either for the able academies or the RD schools, but a place where some of those youngsters might be better served, but also an expansion of opportunity in the School District as a whole to better serve kids that are facing some unusually strong challenges that result in their disruption. And that interferes, of course, not only with their education, but with the education of kids that are in the classrooms where they 2578 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS would otherwise be placed.
We opened the school year this year having needed about 1200 teachers, with about 200 vacancies. That was happily down from 300 vacancies, when we needed only 900 teachers the year before. We have been running something in the neighborhood of 125 to 150 vacancies on a daily basis all year. And those vacancies historically, as you've heard in testimony previously in City Council, were concentrated in three or four areas like special education or in physics or in higher levels of math. Unfortunately, what is impacting on Philadelphia and what is impacting on school districts all across the country is that we can no 20 longer say that the vacancies are limited to three or four areas. Indeed, there are places in Philadelphia where we actually have vacancies in the grades, which is an unusual, at least historically, an unusual occurrence. But that's the spread at the moment. 2579 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS The other thing that we're hit with that is related that is that we don't always have the number of substitutes that we need to fill not long-term vacancies but current vacancies -- I mean, the daily vacancies, when somebody is sick. And one of the reasons for that is that some people who have been substitutes for some years are people that we've been able to equip and move into the classroom to fill some of the permanent vacancies, and so that's reduced them from the substitute role. But the issue of vacancies is -- is a huge one.
And I was hoping that with some of the initiatives that we took last year, that it would have addressed part of the problem.
And it did. And that's the reason that we were able, in effect, to hire 400 extra people, having only 200 vacancies, with 2580 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS 1200 slots -- in contrast to the 300 the year before, with only 900. But didn't close it altogether. And, indeed, I must say that as the Mayor often points out in these cluster meetings, the likelihood of our ultimately addressing that problem fully will depend on dealing with issues of pay parity as well, because our teachers, as a new teacher, a teacher starts $3300 behind their counterparts in the suburbs. And on average, they end their careers about $10,000 behind. So we find ourselves in the unenviable position of having to offer a slot to a teacher where they will have as much as a third more children, a third to a half, children than face a good deal more challenges, and they get to be paid 10 to 25 percent less than their counterparts. So it's one of the major issues that loom for us and one of those important financial issues.
Thank you. The Chair recognizes Councilwoman Miller.
Thank you, Madam 2581 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Chair. Good morning.
I have a couple questions, right now anyway. And this question's for Debra Kahn. What specifically is the role, or the charge, of the Secretary of Education as it relates to the Mayor and his taking greater responsibility for the School District?
Sure. Well, in the first instance, I think that the fact that the Mayor decided to create a cabinet-level position for education is a signal of his commitment and the priority that he has placed on the issue. As he's described it many times, we're a team sitting up here, you know, with the Mayor, myself, the Superintendent, the members of the Board, and the Board Leadership. We're a team. 2582 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS What I try to do, and because I bring many different experiences and perspectives to the role, both as a previous Board member, for example, and as a parent in the system, as somebody who's been involved in government in the private sector, is to help with strategy, to help with, you know, particular issues as they arise. I think that we are going to be very much be creating the role, but I think -- you know, and so those specific duties and specific tasks that I take on will come. But, I mean, for the immediate moment, what we are really focussing on are the priorities. And one was, of course, the development and appointment of the new Board of Education. Secondly, we'll have a role, and have had a role, in helping to define the issues, for example, in the negotiations underway with the teachers' contract. And thirdly, and perhaps most importantly, in the whole financing area for the schools, in making sure that we can, in fact, fulfill the principles and the objectives that the Board President laid out.
Okay, thank you. 2583 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS And this next question is to Mr. Hornbeck. And what I'd like you to do is describe what a "quality public school" actually is. And when you use the word "quality," we could all be talking about something else, and I think people need to be clear on what our goal is -- to make schools first quality. What is a first-quality school?
Well, let me describe it in two ways, one in terms of results and one in terms of my judgment about some of the inputs. You will know you have a quality school when virtually all of the children are performing and reading and doing math and science at levels that will ensure that they can be successful, either on the job or in college, when they leave school, and that they progress through the grades in a timely fashion and graduate on time. And if you don't have that happening, then you do not have, in my judgment, a quality school. Now, the ingredients that make up a quality school include the following: It would be a school in which the principal and the faculty are clear about the 2584 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS standards that students are expected to meet, the knowledge that students are expected to know, the skills they're expected to have. Secondly, a quality school would be one in which there is significant opportunity for the faculty and the school to consult with one another about the curriculum, instruction, and individual children, and that those children and those faculty and the parents of the children have an opportunity for an ongoing, in a sense, support conversation around each individual child, that children are not anonymous in the process. A quality school is one that, in the framework of that conversation, identifies early on the problems that children are having, so that you don't have to get to a point where a child is two or three or four years behind in reading, or a child is engaged in really dangerous, disruptive behavior before there is intervention with the child, and that there is a process to pick that up. We happen to call that "the Comprehensive Support Process" in the School District. A quality school is one in which the faculty routinely are engaged in intensive 2585 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS sustained professional development, learning how to be better teachers in a routine way. A quality school is one that has sufficient instructional materials and books and, I believe, a computer-student ratio of at least one computer for every six children. I think a quality school, at the elementary level, is also one that whose children have had the opportunity of a quality pre-kindergarten program, at ages three and four. In our society today, the only children that don't have pre-kindergarten opportunities are poor kids. Ninety-nine percent of all other children, anybody with means, has some kind of an early education experience for their kids or their grandkids by the time they're three or four years of age. And, finally, I would say that a quality school is one that is in a decent facility. It doesn't have to be a brand-new facility. Goodness knows, there's quality education going on in some schools that are not brand-new, in a school system where the average age of the school being 60 years of age. But we have too many schools with too many maintenance 2586 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS problems, we have too many schools that are grossly overcrowded, we have too many schools that the electrical system doesn't have the capacity that would permit us to plug all the computers in when we get them. So, I mean, we're working this thing in tandem. And, actually, the last thing that I would say, which I've implied before, but I want to explicit about is, a quality school is one that opens its arms to its parent population.
Okay. This is a follow-up. The schools that we have here in Philadelphia, the public schools, what percentage would you say is already, if not at, but near the quality school level? So that we understand the tasks, you know, the volume of the tasks here to create first-quality schools.
Well, let me say, so I'm not misunderstood, that the faculty and principals and parents in the vast majority, 90 percent of the schools, and it's reflected in this dramatic improvement in test scores, have over the last five years done an extraordinary job of moving us in the right direction. And, indeed, on a 2587 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS system-wide basis, they have done so well, that is we look to that extraordinarily high 12-year goal, the school system is ahead of the trajectory that it needs to be on. That said, I would have to say to you that there are very few schools in Philadelphia that reflect all of the ingredients of a quality education that I've described. Almost none have a computer-child ratio of 1 to 6. We have 7800 4-year-olds without pre-K and about 16,000 3-year-olds without pre-kindergarten. We do not have the support for the continued professional development of staff that is necessary. We do have a faculty and administrative leadership that largely are aware of what kids need to know and be able to do. But there are very major missing ingredients. I wasn't explicit about it but, for example, we've got several grade levels who to this point have not even been able to have summer school. And, you know, what self-respecting school district can't even offer summer school? As much as kids may not like it. You've got to be able to respond. 2588 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS We have very limited capacity to provide after-school tutoring. We have dozens and does and dozens of schools who are unable to serve their children in after-school programs and thus put issues of safety and security at risk. So I would have to say to you that there is virtually no school in Philadelphia that I can say has all of the ingredients of what will be necessary over the years ahead to meet the standards of a quality education. And let me emphasize something that I said in my testimony. This is not about producing schools that are in the upper 1 percent of opportunity in the United States. What I have described to you is a set of opportunities that, in more affluent districts, are normative, they're routine. We don't want more than what other people have; we just want our fair share.
Thank you, Superintendent. I may come back to this whole issue 'cause I would think that if nothing else, the High School of Creative and Performing Arts would be the closest thing to a first quality, from what 2589 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS I've heard, you know, that it is state of the art.
Well, I think that we have some -- CAPA is a wonderful example. Masterman is, in fact, the first -- in terms of test scores, the best in the whole state of Pennsylvania. I think that what Saul brings to -- there's certainly no agricultural school better than Saul. And I can go on down the line -- Central and so on. And I think that those schools are as good as exist. But it is also my belief that the objective is to ensure that, in effect, all 259 schools that you don't have to travel on a bus for an hour and a half, that you don't have to go across town to have opportunities of excellence, and there are -- which are really terrific over these last years -- is that in every single -- for example, to stay in high school, a comprehensive high school in the City, we are beginning to see small learning communities that do excel. But in many instances, it's what I meant by "beating the odds." In too many schools across the City, in order to achieve excellence, in order to succeed, faculty and principals and 2590 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS parent and kids are required to beat the odds in order to do that. And Philadelphia's kids ought to have the same chances that other kids have.
A couple months ago, I read an article in the paper and it indicated that we were accepting students from outside of the City. Why should our children be denied, and why would we accept children outside of the City? Are they paying tuition if they do come from outside the City, and why would be doing that?
They do pay tuition. And as a consequence of that same newspaper article, we have reviewed that and we are prepared to, in fact, put that in front of the Board of Education and to -- the staff will make a 2591 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS recommendation that we begin to phase that out. And what I mean by phasing it out is that there are some kids there who are seniors and they have been there for four years, and we don't want to toss them out, but arrive at a point where --
How many students at CAPA do we have that do in fact live outside of the City?
It's my understanding that we have about or each year spread 12 across the four grades, that three are over the 13 X-number of years, going back even before they 14 were in the new wonderful building. 15
I just feel very strongly that children who live in the City should certainly be given every opportunity to attend CAPA.
Thank you, Madam Chair. Good morning, Mr. Ramos, Miss Rush, Miss Kahn, and Mr. Hornbeck. 2592 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS First Mr. Ramos and Miss Kahn, if I could ask if you could engage in some dialogue both with the Mayor and the Council President regarding one of the somewhat overlooked provisions of the ballot initiative that the voters approved which, naturally, resulted in the Mayor to make immediate appointments to the School Board was a provision that has the School Board, the Council, and the Mayor meeting twice a year to talk about the state of public education and a wide variety of issues that are laid out in that particular provision. And if you could, at some later point in time, share with us what you think the timetable for something like that would be, I would greatly appreciate it.
Thank you, Councilman Nutter. As you noted, I wrapped up my comments by referring to that type of meeting, and we would look forward to doing that sooner rather than later. We think that it was a well considered part of the charter amendment and couldn't begin at a more critical time.
Okay, thank you. 2593 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Let me go back to your testimony, Mr. Ramos. On the front page, you make reference to, if you adopt a carry-forward budget for the Fiscal Year '01, you say that the gap between projected revenues and expenditures will grow to $137.4 million with a projected fund balance deficit of $175 million. If we could start out with just a basic explanation of why that happens with a carry- forward budget. What causes the rather rapid expansion from a $39 million deficit to 137?
Mr. Ramos, could you pull the microphone closer to you, please.
Well, I can start and ask the staff to jump in when I get into trouble, Council. My understanding is that there are -- some piece of that, of course, is salary increases that are already in existing contracts. There are inflationary numbers in there that I understand, after cross-examining staff, are real hard numbers. And that -- and it also, I have to add, 2594 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS is really a netting out. The increased -- you have increased expenditures and you also have some offsets with that. But you have a -- those are two of the pieces. I would also ask -- we also anticipate an increase in the enrollment of charter schools where we budgeted an increase of 4200 students.
I'm sorry, Mr. Ramos, I don't mean to interrupt you, but you're going to have to pull the microphone closer to you so that the stenographer and we can hear you.
I think I should start looking forward instead of at the Councilman. I was mentioning that the other items, in addition, you have salaries, you have hard inflationary costs, and expansion of charter schools currently budgeted -- to be budgeted to be 4200 students. And I believe those are the big-ticket items.
Just to put some numbers into the categories: About 36.8 million in contracted salary increases; 2595 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS 24.7 inflation, including a percent increase in medical insurance, which accounts for 15 million all by itself; 3 million, which is a 7 percent increase in mandated tuition payments, mandated by the State to schools where we have to send kids that we can't serve; 4.2 million in utility increases; million in extra charter school payments;. And a loss -- this is sort of a different notion. A loss of $11 million in Annenberg Challenge money, because it runs out on June 30th. If you added all that stuff up, it would come in the neighborhood of 95 million of it. And then the balance of it is just a whole lot of other stuff. There are some offsets there as well, like the $36 million that we got from the State in extra. But those are the kinds of big-ticket items that are involved in it.
Okay. You made -- someone made reference to it in their testimony, 2596 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS to the issue regarding your computer system, which, I assume, is why we don't have -- we usually get at least, one possibly two large books. Is that why we don't have those books at this time?
Is there any, I guess, concern by the District that as you go through this, does this potentially affect your ability to make a case to the State as to what the true financial picture is with the School District?
No. We are at the -- the main thing that it affected, for purposes of the budget, were salary projections. And since salary is such a huge part of our budget, it delayed the preparation of the book. The book, with all of that in it, with 99 percent-plus accuracy, because all of this is now being brought up to date, is scheduled to go to the printer on March the 9th and come back from the printer several days later, which is why we will be in a position by roughly the third week in March to provide it to anybody. 2597 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS So it's been the back end catching up with the front end. But, no, it's -- we are now within sight, even on that level, of going all the way down to the most -- to the finest details.
Councilman Nutter, I would also add that when you get those books, I would ask that you recognize that the Board is only -- the new board is only beginning its budget deliberations, and we will be guided in those deliberations by the five principles outlined in my testimony.
Okay. But, I mean, you also understand that it has some impact on us as we try to even conduct our business or our involvement in this particular process.
Yes, Councilman, and that's why we want to get those books to you, but it also increases the need for communications so that we know in the interim where we are.
Okay. Superintendent, on of your testimony, a couple of the bullet points, you talked about quality preschool for additional 2598 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS 4-year-olds and eventually for all 3- and 4-year-olds. What did you mean by additional 4-year-olds?
The recommendation that I will make to the new board is that between one-third and one-half of the unserved 4-year-olds would be served in '01.
This is only under Fair Opportunities to Learn, though?
This is under Fair Opportunities to Learn. There are presently 7800 unserved 4-year-olds, so someplace between a third of that and half of that. And depending on, you know, whether we could do this in different ways, but then phase in the balance of the 3- and 4-year-olds over the next -- the subsequent two to four years.
The second bullet point was smaller classes, to a limit of 17 kindergarten and in the 1st grade and in the following years for grades 2 and 3. Can you discuss with us -- there is no 24 mention in any of your testimony that I've read here this morning that we were given any real 2599 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS discussion about the state of either overcrowding in many of our school buildings or the general condition of the buildings. No one touched on that in any of the testimony or the documents that I have here.
I can. And overcrowding is a very serious situation. We probably don't have more than, I don't know, six clusters in which overcrowding is not a serious issue. And so we are unable to approach the issue of reduced class size in what has come to be the normal way. So that last year, when we gratefully, but unexpectedly, had an appropriation from the federal government of almost $13 million to reduce class size and wanting to take advantage of it sort of a year ahead of schedule, and in the plan, we realized that there are two basically worldwide strategies for improving reading, something called "Success For All" and something called "Reading Recovery," that rely on, in effect, having two teachers in the same classroom. And so we conceived -- and now the U.S. Department of Education is using it as a kind of model to tout around the country -- a process in 2600 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS which, as real teachers, we engage what we refer to as "literacy interns." And the literacy intern, who's not an aide -- and I want to emphasize that -- but is a teacher and treated like a teacher, two people are in the same classroom. And we implemented this in about 60 schools this year, in about 260 classrooms this year. And we began it last summer with what was a very unusual and very successful training program for four weeks, where we brought together the senior teachers with their literacy interns and did this training session, and then the training has continued during the course of the year. And we propose, as we lower class size in the rest of kindergarten and the 1st grade and then 2nd and 3rd grade, we would propose to pursue that model. And, indeed, in lots of instances, from our experience this year if this were a place where we had the choice of non-overcrowding and the traditional "put-17-in-this-one-and-put-17-in- that-one," we would not necessarily at all go to that model, because the benefit that we see that 2601 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS is arising in lots of different ways from the literacy intern is really quite compelling.
Well, I guess one of the components of my question was, it seems that there are two elements that you need to lower class size. One, you need more space, possibly, unless you choose to follow the model that you did or -- and -- it's really not an "or" -- and you need more bodies.
What is our ability to either increase space in an already overcrowded situation and recognize we're already having a teacher shortage? How do we do this?
Well, what I said before addresses the space issue, and so we're continuing to pursue that, we're okay on that front. We're not okay on space.
We face -- in fact, going back to your previous question of pre-kindergarten, we face serious space issues, we've got space issues all over the lot. But for 2602 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS purposes of reduced class size K to 3, that's the approach we're taking and it's working. With respect to the bodies, and going back to President Verna's question earlier about vacancies, the one area where we didn't have a problem this year with vacancies was with the literacy interns. And it looks like we're needing even more next year, that because you can't just up and go out and get people overnight, we started advertising for these folks a month ago. And let me give you last year's concrete experience, but it's unfolding the same way and in even greater numbers this year. Last year, we had about 1100 inquiries. We ultimately got 800 applications, and we were -- we hired about 320, even though we needed only 260, in a sort of airline over-booking way, because our experience is that some people take off on us late in the summer, and lo and behold, they didn't. And so we found ourselves uncommonly rich in people, and we had to go to some of our folks and persuade them to take some of the other positions where we had vacancies. So it's been real extraordinary, the 2603 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS response from people wanting to -- so while we have lots of challenges in that area, it looks like being able to find sufficient numbers of quality people for this role does not present a problem.
Councilman Nutter, I would just add that, as the Superintendent said, personnel is probably doable, space is tight but probably doable. The third piece is revenue, money, to do it, and that will be the tougher of the -- among the three.
Right. Well, even by my own calculation, I know that I'm probably over my time, so I'd like to come back to the revenue issue and the general status of the school buildings in the School District. And Madam Chair, I'll come back.
Could we move back 2604 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS for a moment to the computer system. Just for some background information, how long ago did we begin the process of engaging in this computer overhaul, refurbishment, whatever -- how long ago and what was the exact mission of the contract and the whole process?
It was about three years ago, three and a half years ago, and we approached it with two objectives. One, we had to do because of Y2K, and that was to ensure that all of the codes for all of the stuff we did across the District was in order. We took advantage of the money that we were going to have to spend on that to simultaneously upgrade several of our systems, including Human Resources and Purchasing and Finance, because some of the money -- instead of simply rewriting code in an old system that would still be old after you finished it and which, long ago, had proven its inadequacy, we decided to overlap the two things so that we would come out both Y2K-compliant and we would have a system that was capable of a lot more after we finished.
So it was a pretty major overhaul. 2605 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS
What was the process that was engaged in an effort to determine the specs required for the contract? And walk me through the selection of the contract.
We could certainly give you also -- I'm == I'm going to do this a little from memory, but if you want it, we could do it in more detail.
It was one of wide consultation within the District between both the technical people on the one side, lead by the then-CIO Greg Vincent and the then-Managing Director Clay Armbruster (ph.) and also the users -- that, is the people in Finance and the people in Purchasing and Human Resources. Out of that emerged some specs that resulted then in proposals from at least two companies -- I can't remember whether there were at one point more than the two or not. Then a team of people representing both users and the technical people and the Managing 2606 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS Director's Office went out and visited on site places where these were in operation. And the result of that whole process was initially to offer a contract to one of the companies because the proposal, the picture they painted, the opportunities that they seemed to be offering, were considerable and very exciting to us. In the course of negotiating the contract, we concluded that most importantly, that they were simply unable and had never delivered what they had offered us, and that ultimately lead, after repeated attempts, to continue to pursue what we thought we were getting in the first instance, the other company, which has, I guess, more of these kinds of programs in place across the United States than any other.
Oracle, and AMS was the one then that we ultimately contracted with.
Did the committee of technical people -- I guess it was sort of a selection committee -- did they make a recommendation to the Superintendent's Office or 2607 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS to the Board at any time as to which should be selected?
Yes. Originally, as I said, they recommended to me that we pursue the Oracle contract. We did. We even secured the authorization from the Board to go forward with that contract. I very much wanted -- because the sort of layman's picture of what it was going to permit us to do was very attractive. It was only subsequently when it proved to be impossible to complete that that that we switched.
Did that technical committee agree with the assessment that AMS was, in fact, in reality, a better choice than Oracle? Or was that a decision made by the Board or by the Superintendent's Office?
No. They -- after -- it was always the technical people, together with the Managing Director, who did all of the negotiations, and it was they who finally concluded that we would be unable to secure what we had thought we were going to be able to get, and therefore recommended reluctantly that we had to go in the other direction. 2608 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS
So that was a formal recommendation from that committee to choose AMS as opposed to Oracle?
It was a formal recommendation from the Managing Director and the CIO who were charged with leading that.
So what it did was, then the contract was then awarded to AMS?
And what was the initial amount of the contract that was awarded?
I don't have those details in front of me, but I can certainly get them for you.
Does anybody here on your staff have any idea of what the original amount was?
I don't think anybody is here today that could give you that detail, but we can certainly supply it to you.
Was it million or 2609 1 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS was it 30 million or was it somewhere in between or was it --
It was certainly not 1 and it wasn't 30, but I don't remember the precise number.
Councilman, did you want to know that number now?
Well, I mean, I think it's a pretty big contract so I think somebody would remember what --
I think the Superintendent could make a phone call or perhaps someone on his staff might call --
Councilwoman, I can give you even bigger caveat and give you a ballpark of my recollection. It was in the ballpark of million. 22
Okay. So that was 23 the original number of the contract -- oh, I mean, 24 you could give me the documentation later on what 25 exactly the number was, but your recollection was 2610 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS the Board originally approved a $25 million contract for AMS to do this work?
It's a long story and it's hard to remember where began, but that's my recollection.
And I apologize if I'm wrong, but we'll get you the documentation.
When was the contract awarded to AMS, do you remember? When was it?
Well, I think it was -- I think it commenced -- there's something in the back of my mind that tells me it commenced 16 months before. About last August or September, so 17 whenever that was. 18
When did they complete the contract, or did they ever come to a point where they actually completed the work?
No. They're still working with us today, and it is at least our 2611 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS staff's hope that they will continue to work with us for sometime into the future.
Have they exceeded the original amount of the contract? And if so, by how much?
They have exceeded it. We've had to go become to the Board on two occasions? -- I think on two occasions to ask for additional funds for that.
No. In the first round was a significant increase in the staffing that it was going to take because we had overestimated -- or the CIO's office originally had underestimated -- or overestimated how much the School District's personnel time was going to be available and committed to the project. So the big chunk of money that was added for that shift. 2612 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS
Do you remember how long ago that request, or requests, for additional funding were made to the Board? I mean, was it within a year ago, less than a year, more than a year ago?
More than a year? And you think it was a -- I don't mean to characterize it. Was it an insignificant amount or was it a large amount?
Councilman Kenney, I can't speak for the entire Board on what their feelings are or the District. I can tell you that it's been a frustrating experience for everybody.
An additional frustrating and a very expensive experience.
Well, I think, compared to similarly-situated districts, I'm not sure that it's more expensive. In fact, we've been told otherwise, but --
But I believe -- I mean, I, you know, frankly, I believe that from the very 2613 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS beginning, from just, you know, a Board member's perspective, there was some range of opinion on which way to go, and I think a lot has gotten accomplished to deal with the problems that have arisen and to get such a huge overhaul done. If I were to identify two areas where I think there have been -- where I've had significant concerns, they've been in the area on how good of a job we did in advance of training people for the new system, and I think, more fundamentally, how good of a job was done on bringing everybody that needed to be involved in the system on board. I think it's been -- I think there's been lack of a sense of team because of the difference of opinion hurt the project.
Wasn't training a part of the original contract with AMS? It's my experience that when a company is given that kind of contract, part and parcel of what they're supposed to do is train people to use it once they've put it in place.
Training was a part of the contract, and I do think that Mr. Ramos's observation that the job we did on training was 2614 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS inadequate.
I'm sorry, you said "we." Is the company "we" or is the --
Well, the company played a major role in delivering the content, but the District bears also responsibility for organizing the time, of having done it in enough time. I mean, one of the mistakes I think we made is that we ended up attempting to do this in months, when other places that were not even as 12 ambitious have taken 48 months to do it. And it's 13 that date, and it comes from AMS. But it's a 14 matter of public record that other places with 15 similar efforts have taken twice the time and a 16 lot more in expense than we have. 17 But we still made -- I wish, in 18 retrospect, we had taken three or four years to do 19 it and that we had done a better job of training. 20
The problems that 21 have been reported in the press related payroll and other types of payment problems, and I guess the computer -- I mean, the lack of budget detail today, they're all related to the problems that have resulted by implementing this contract and 2615 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS moving, are they all computer-related problems?
Well, I -- my assessment is that they are largely training problems, not computer problems. And they're not the fault of the people that didn't get the training; they are the fault of those of us who didn't provide the framework for the training that was adequate. And the system itself, the software, the system has largely worked the way the system is supposed to work, and has worked in dozens of places. And the problems that we've encountered are not all that dissimilar to lots of other places that have encountered problems.
Have we been required to go out and to contract with other types of firms, other types of companies to do, for example, payroll work or to do other types of work that the lack of training and/or the inability of the company to perform has required us to go out and hire other people outside of AMS, to kind of advise us or deal with these problems?
Well, I'm -- we -- I don't think we've had to go and like subcontract pieces, at least to my memory. 2616 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS There are two areas that may be related to what you are asking. Because of some of these input issues that I was talking about, we have hired -- I don't know that we have many still on board, but there was a time four months ago when some of these problems were at the peak, and we just had to, we just could not face a situation in which employees didn't get paychecks.
These people were trying to get from Friday to Monday and --
I guess what I need to know, and if no one here knows it, I need to know the original amount, the amount that we've spent so far to date, and the amount that we've had to spend so far to date on the AMS contract and --
I'm sorry. There's a lot of pens moving behind me and I want to make sure that we get your questions.
I'm sorry. Need to 2617 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS know what the original amount of the contract was. I'd like to see a copy of the contract, if possible. I need to know what we've spent in excess of the contract and what other -- I don't know whether it works by change order or similar to different kinds of different -- I need to see copies of the change orders as to what was being done. And I also would like to know how many firms and how much money we've spent outside of the AMS contract to kind of advise, consult or fix or help us fix some of the problems. And I guess the most important question I need to know right now is, does it work yet? I mean, are we done spending money on this project and are we in order?
As I had suggested in response to the question to Mr. Nutter a while ago on the issues that prevented us from giving you a board book today, besides the fact that it would not have been attended to by the new board, which, in some ways, was the most important piece, that is largely done and fixed, as you would put it. 2618 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS That is -- that is also true with the payroll process. There continues to be, there will always be, there will be ten years from now -- and there were more two years ago -- problems with payroll on a biweekly basis than there are today. But we are back to a place where there are fewer problems today than there were two years ago in spitting out payroll for 30,000 employees. We do expect to bring to the Board, as we've said to the old board on previous occasions, what would be a fifth statement of work with AMS.
"Statement of work" is what I said, an identification of what needs to be done.
I'm sorry. Is this a part of the original contract or is this additional dollars?
It's additional. It -- 2619 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS there is a basic system and then there are additional modules that we did not buy in the first instance that get added on, that permit us to use the system more productively and to greater advantage.
Do these additional modules have to be purchased as a result of something that wasn't done as a result of the first contract?
No, no. This is to be able to simply do more and better things with the same system. In fact, it will end up -- like with Purchasing, we've been able to reduce the Purchasing staff significantly because of the implementation of the AMS program because it permits the online purchase of things that used not to be possible. We want to continue to move things out of administration and into the classroom to be able to fund things, as we have been out of administration, like kindergarten.
I know I'm going on. I just have one final question. As we sit here -- and I want to come back again. As we sit here today, is this computer 2620 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS system that we contracted with AMS to provide these services doing its job? Are the problems resolved? And will there be any additional requests for money? Or, again, problems are unforeseen, but do you expect that there's going to be any more difficulties with the system? Besides the new modules that you may buy, as based on the original contract, are there any other problems or any more requirements or requests for additional money above the ballpark figure of million and then whatever else we spent as a 13 result of problems? 14 Are we done as far as the original 15 contract? 16
I'm sorry, the 19 add-ons for problems or the add-ons for new 20 modules? 21
No, no, no. We went 22 back to the Board, as was stated a moment ago -- 23
-- for additional money 25 to do things that we thought that the original 2621 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS contract would have taken care of.
And there may be issues there, and I don't know for sure what that will be, where we will have to, in a sense, clean up the end of that.
Do you find, or does the staff find that in any way, shape, or form that AMS did not meet the requirements of its contract? Even though we may recognize the need to pay for things to fix them 'cause people aren't getting paid, do we believe in any way that the company is in some way responsible, fell down on the terms of their contract? And are we seeking to recover any money from them?
We have, in fact, already secured from AMS additional AMS 2622 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS assistance, for which we will not make payment, as we resolve some of these issues. I would not characterize those in a -- with "breach of contract" kind of language, 'cause I don't believe that's what's happened. But, yes, there will be instances in which, through negotiations, we will say, We believe you have a responsibility to do X, Y, and Z because of A, B, and C, but this additional set of ours are ones that we think we have an obligation to pay for as we seek to have done these things.
No, I yield and I apologize for the length of time that I took.
And, Mr. Hornbeck, you will be returning on Wednesday, at 2 o'clock. So I would appreciate it if you would have the information to the questions that Councilman Kenney has asked you today.
Madam President, I will certainly have it by Wednesday. I would ask your 2623 3/6/00 - OPERATING BUDGET CONT'D - SCHOOLS indulgence. I'm supposed to be in a briefing with the Mayor and the Board at 2 o'clock, and was going to --
On Wednesday. And I was going to ask Miss Ingram to come and represent me for a period of time until that briefing is over. But under any circumstance, we will have the information for you.
Have you informed the Mayor that we were having public hearings?
I don't know what your conversation was. Would you share it with us?
Yeah, we knew that you were starting later in the afternoon, and we're planning to start very early in the morning, so there's only an overlap right now of one hour, and we can adjust that.