Finance and Facilities Committee Meeting: March 14, 2019

by Diane Payne

Lee Huang and Leticia Egea-Hinton co-chaired this meeting; Committee members Angela McIver, Chris McGinley, Joyce Wilkerson, and Wayne Walker (via telephone) were present.  Board Member Julia Danzy joined about midway through the meeting. One APPS member testified on behalf of public education. This meeting was held at 10:00 a.m. and was sparsely attended compared to last month’s meeting held at 4:00..  February Committee minutes were approved.

Meeting agendas and powerpoint presentations can be viewed on the SDP website by going to the Board of Education page and clicking on “meeting materials.”


Chief Operating Officer Danielle Floyd narrated a presentation on three still unanswered questions raised at a previous meeting. Floyd confirmed that the sale price of West Philadelphia High School was $5.1 million.  When looking up the property, a sale price of $1 is listed. However, this was a developer transaction that happened after the SDP sale. In answer to a question from Lee Huang, Floyd stated that the only way to verify any sale price is to search through the past resolutions for the specific resolution which approved the sale.  Floyd failed to note how tedious that would be and how difficult it is for a member of the public to find that information without the actual date and number of the resolution. In this age of computer information with everything at one’s fingertips, District information only goes back a few years and is cumbersome to search for–the antithesis of user-friendly.

The second follow-up addressed training on 2-way radios the District is acquiring due to an Act 44 grant.  Floyd confirmed that personnel will receive two to five hours of training.

The final follow-up concerned building conditions at Jackson Elementary School.  Floyd stated that the District has taken steps to improve conditions at this school after receiving several complaints.  In response to a question from Huang, Floyd said that the first step in addressing this type of complaint is to go to the school’s administration.  If the complaint remains outstanding, one can address the complaint to a Facility Area Coordinator (there are 21 in the district). However, Floyd was not sure if this information was on the website and/or if it is easily found.  She said she will follow-up on this.

Overview of the Mayor’s Proposed Budgets

City Director of Finance Rob Dubow and an assistant gave this presentation on Mayor Kenney’s proposed short-and long-term budgets.   The two biggest takeaways from this presentation: the largest single spending increase in the City’s FY20 budget would be the City’s contribution to the School District, and the City would set aside funds to maintain and safeguard its own fiscal health in the event of a downturn (a rainy-day provision).  The City has multiple streams of revenue but the two biggest by far are the wage tax and the real estate tax. Both the Mayor’s FY 19 and FY 20 budgets propose increased City contributions to the District, beginning with $33 million in FY 20.

President Wilkerson related that advocates have been asking questions about the tax abatement with regard to funding; she asked Dubow when that might come up for consideration.  Dubow said that there are three pieces of legislation on abatements “floating around” so he assumes this will come up for consideration within the next couple of months.

The School District will present next fiscal year’s budget to City Council on May 14th; the public can testify on May 15th. The Board will approve the final budget at the May or June Action Meeting.  (This powerpoint is accessible on the BOE page of the SDP website.)

We must say again that it is unacceptable that important and necessary information is omitted from the distributed materials.  There are no names of presenters on the agenda materials nor on the powerpoint presentations. People state their names at the beginning but that does not clearly define who is presenting or speaking.  It seems like an obvious inclusion in public materials to note who is presenting. In addition, acoustics in the Committee room are consistently bad, compounded by the fact that some speakers have to be asked repeatedly to speak into the microphone. APPS continues to raise with the Board the issues of lack of printed materials and inability to hear speakers at the Committee meetings. The Pennsylvania Sunshine Act states that any meeting at which the public cannot hear is not a public meeting.

Proposed District Five-Year Plan

Chief Financial Officer Uri Monson presented the powerpoint on the District’s short- and long-term budgets..  The detailed presentation included goals, an investment plan to create progress, investments that are working, new investments to accelerate progress, infrastructure investments, and  a 5-year plan focused on fiscal stability and significant fiscal achievements. Monson then moved into the 5-year plan’s fiscal assumptions, projections, risks, and cost-drivers.

The District anticipates ending with modest fund balances until FY22.  Four major expenditure areas are driving growth from FY19 to FY20: Increase of $96M for payments to charter schools, increase of $38M in funding shift from Ready to Learn (RTL) grant, increase of $37M for salaries, increase of $31M for employee benefits.

The risks listed by Munson include:  the governor’s proposed new investments not included in final State budget;  uncertainty around the City’s Real Estate Assessment valuations; delays in the state budget process in FY19, including  increases to borrowing costs, making planning and investments more difficult; narrow positive ending fund balances; projected FY19 ending fund balance of $156.9M is equal to just 5.0% of expenditures; changes to the charter school formula and authorizing authority; increases in the already mounting Public School Employees’ Retirement System (PSERS) contribution schedule; economic downturn affecting funding assumptions; and the federal budget just proposed by President Trump that includes cuts to Title 2 and Title 4.

The budget timeline from Monson’s slide presentation:

▪ March 6-22: Principals Complete School Budgets ▪ March 28: Board of Education Lump Sum Vote ▪ April 11: Finance and Facilities Committee Meeting ▪ April 25: Board of Education Budget Hearing ▪ May 14: City Council Budget Hearing ▪ May 16: Finance and Facilities Committee Meeting ▪ May 30: Board of Education Budget Vote ▪ May: City Adoption of Tax Measures for School District ▪ June: State Budget Adoption.

Co-chair Huang commented that  many news items have related how private funding initiatives get tangled in unethical results and asked how the District guards against this happening.  Monson stated that The Fund for the School District of Philadelphia has strict procedures and guidelines to safeguard the donation process but that he will work on having a presentation from The Fund sometime after the budget season.

APPS continues to raise the issues of inequity brought about by depending on charity to bolster District coffers. One APPS member told the Committee last month that all funding decisions must be made by the Board, not in private boardrooms. The Fund for the School District has its own board that does not hold public meetings; they should not be deciding which schools receive funding.  The Philadelphia School Partnership (PSP), is a “non-profit”  organization funded by millions from donors including the Gates and Walton foundations.   PSP promotes privatization of our public schools and has had an outsized influence on public decisions–even lobbying Harrisburg in 2013 to reject federal funding unless PFT members agreed to significant cuts in salary and benefits! PSP is a closed-door organization with no accountability to the pubic.  Many on the PSP board are wealthy individuals living in suburban Philadelphia who exercise great influence in charting the course of our city’s schools.

Guaranteed Energy Savings Act (GESA)

Chief Operating Officer  Danielle Floyd conducted this presentation on the GESA.  The three schools originally listed for work on this energy savings program–Northeast High School, Saul High School, and Strawberry Mansion High School–have been replaced. The schools now on the list are Lincoln High School, Gompers Elementary School, and Conwell Middle School and Annex.  It remains unclear why the selected schools were changed.

At the March 28th Action Meeting, the Facilities office will be recommending the Board  approve Action Item 42: No Cost Contract and Right of Entry with Johnson Controls, Inc.–Comprehensive Energy Audit at Various Schools.  There was no explanation of why this is a no-cost contract, and no questions from the Committee members were raised to clarify this.

Revenue generated from energy savings is  not in the district’s projected budget. Future funds realized from this project will be earmarked for investment plans to increase student progress (See Monson’s budget presentation).

Facility Renovations and Remediations

The final District presentation was Floyd’s update on Lead Paint Stabilization & Plaster Repair, Heating Season Progress, Design and Construction Project Update, Capital Projects Update, and Environmental Remediations.  (If you have any questions about your particular school’s building condition, you can access your school’s report on the SDP website. Here’s how: Go to SDP website and click on “Schools” at the top. Click on “School Profiles.”    Scroll through to your school and click. On your school’s top bar of choices look for “Additional” and click. You will see a mid-page choice of Building Information Facilities Condition Assessment Report. This will give you your schools entire list of building assessment needs.)

Action Items

There were 27 Action Items listed on this meeting’s agenda as possible points of discussion, but there was no discussion on any.  This brings up another point of routine preparation of materials for the public. The SRC (however dreaded they were) listed all resolutions by  number which made finding any particular resolution somewhat easy within the multitude of items. Despite repeated requests from APPS to make materials more user-friendly, this Board does not number the Action Items (no longer referred to as resolutions) on the Committee agenda.  This makes locating a specific Action Item cumbersome and difficult. The failure to number Action Items, along with the failure to provide any copies of the documents (except in two or three “do not remove” binders in the back of the auditorium) goes against the Board’s stated commitment to transparency and public engagement. The Board  makes a brief announcement at the beginning of the meeting that Items can be found on the District website. Are people supposed to follow the presentations and deliberations while also trying to find documents on their computers or phones?  Does the Board assume that all parents and community members have access to this technology? A big assumption.

Public Speakers

I was the only public speaker at this meeting.   I asked the Board to publicly support efforts by the Our City Our Schools (OCOS) Coalition to urge City Council to pass the proposed bills which would  amend the City’s tax abatement program. Many public school advocates have pointed out that this tax abatement program benefits wealthy developers and landowners while shortchanging our schools.  Board members have said, incorrectly, that it is not in their purview to suggest to the City how taxes should work. I asked if they would at least publicly discuss the pros and cons of taking a position on asking City Council to hold hearings.  I noted that it wasn’t an ask in support of any particular taxing strategy but in support of the position that City Council Members just bring these bills to a hearing. Wilkerson stated her position that she did not believe it was in the Board’s area of business to take any action or position on taxing.  None of the other Committee members commented. Board members must understand that although they are appointed, not elected, they do have a constituency–all of the people of the city. They should advocate for their constituents as elected officials do. (You can read my remarks below, and you can watch my testimony at the very end of the Finance & Facility video on the BOE website.)

Diane Payne’s Public Testimony

The Our City Our Schools coalition is a group of diverse grass-roots organizations who came together with the single focus of returning local control to Philadelphia.  With the abolition of the SRC, OCOS turned its attention and efforts to fighting for the schools our children deserve. I would like to bring before this committee an ask.  The city’s tax abatement program is one piece of a school funding puzzle. The Coalition has been engaged in serious efforts to move our city’s elected officials into reforming the tax abatement puzzle piece which is contributing to the rich getting richer while too many of our students & staff are in toxic buildings.  Multiple bills have been floated in city hall but so far, no hearings have been scheduled.

We know that Board members may not believe it is in their purview to suggest to City Council representatives an action on tax abatement.  However, as your constituents we are hoping for support on this issue. Will this Board publicly stand with OCOS and request that City Council hold hearings on the various bills submitted on tax abatement?   This ask is not to support a specific bill but rather to support the need for pushing forward with this effort. We are asking that you publicly debate the pros and cons of such an action and make a public decision about whether or not to support this ask.

Philadelphia schools have never been fairly funded.  We are still trying to climb out of the even deeper pit dug for us by the Corbett years and cuts.  But in our city just like the country at large, the rich get richer while the poor get poorer. Maybe it is time for the members of this Board to decide it is in the best interest of the students you are charged with overseeing and the people of this city who you represent to be more than guardians of the budgets you are given but also active champions for the budgets our students deserve?

Will you discuss this ask?  Thank you.