Dismissed: Tenants lose, landlords win in Baltimore's rent court

City schools face $60 million deficit even without state cuts

Baltimore school leaders facing more than $60 million shortfall

Even before proposed state budget cuts, Baltimore City schools face a shortfall next year of more than $60 million — and officials are considering layoffs as one option for resolving the problem.

Schools CEO Gregory Thornton was in Annapolis on Tuesday meeting with key lawmakers to brief them on the system's budget woes. Participants said he assured them he will make cuts to close the deficit and set the school system on a fiscally responsible path, but asked them to work to restore $35 million in cuts in Gov. Larry Hogan's budget proposal.

If the proposed cuts are approved, the system's total deficit would be roughly $100 million, or about 8 percent of the $1.3 billion budget for the fiscal year that begins July 1.

The deficit is due in part to the ground-breaking teachers contract approved in 2010 that restructured pay scales, but increased costs faster than expected.

In an interview Tuesday with The Baltimore Sun, Thornton said school officials were reviewing many options for cuts, but he said the gap cannot be closed without job reductions, which may include layoffs.

"Reduction in force is one of many ways in which I will look at getting to a good place. That's just inevitable," Thornton said.

"My budget is 80 percent people. It's impossible for me to get there without touching human capital."

He declined to specify the size of the deficit, saying it is being "constantly recalculated." But in recent meetings with state legislators and others, school officials have consistently used figures of more than $60 million.

Thornton has discussed options for layoffs with school board members and union leaders in advance of preparing next year's budget.

"It is devastating," said Jimmy Gittings, who represents 600 school administrators. The budget projection "is going to send panic through our system." Gittings said he would not agree to layoffs, but would consider taking to his membership a proposal for furloughs.

Thornton met with Senate President Mike V. Miller Tuesday morning about the budget deficit, saying he has crafted a plan that would reduce the deficit to about $7 million — as long as the system does not lose $35 million in state aid, as projected in Hogan's budget.

"Everything is on the table," said Shanaysha Sauls, chair of the city school board. "It's causing us to rethink some things that would have been routine."

Sauls said school administrators have explored different scenarios but have not made a formal recommendation to the board about who or how many people could lose jobs.

"Right now we've just shaped the parameters about how it's done," Sauls said. "We believe Dr. Thornton will bring a humane approach to the work, and we want to give him time and space to vet the options."

The 2010 contract with teachers garnered national attention for provisions that redefined how teachers would earn raises. It rewards teachers for their performance and continued training rather than seniority.

The contract gives ambitious teachers the ability to move quickly up the pay ladder if they take on extra duties, get additional training or prove they have increased student achievement. But in offering such options, it made predicting salary increases more difficult than relying on seniority.

And this cutting-edge reform of pay has been costly. Although the school system has not responded to requests for information about the cost of the union contracts, state data show average teacher pay in Baltimore has risen by $4,200 from 2011 to 2014.

Administrators work under a similar contract.

State Sen. Bill Ferguson said that since the contract was signed, fewer older teachers are retiring and more teachers are at the higher end of the pay scale.

"I think the contract has been a benefit because it has kept highly qualified teachers in the classroom and rewarded them appropriately," said Ferguson, a Baltimore Democrat and former teacher. Ferguson was on the school system's negotiating team in 2010 when he worked as a special assistant to former CEO Andrés Alonso, who left in 2013.

Several other factors are contributing to the budget deficit. The school system made a commitment to spend an additional $13 million next year toward the plan to rebuild schools, and it has increased spots for pre-kindergartners.

The past two years, the school system has taken a total of $27.5 million from its rainy day fund to help balance the budget. Last year, the school board passed a policy requiring the fund to be paid back this year. If the board decided to delay that repayment, the deficit would be reduced.

Thornton became school system chief last July, taking over from Tisha Edwards, who served for a year after Alonso's departure. House Speaker Michael E. Busch, a Democrat who met with school system officials this week, said blame for the budget crunch may belong with the previous schools leadership.

"Superintendent Thornton has faced it head on. He was left with a deficit," Busch said. "You have to ask yourself what the previous superintendent's role was in this."

Busch said school system officials wanted to let him know about the budget troubles, as well as assure him they had a plan to tackle them.

Thornton assured Del. Maggie McIntosh, who chairs the House Appropriations Committee, that he was working on a number of options to eliminate the structural deficit. "He had about four or five areas that he wanted me to know that he would try to address with all of the stakeholders," McIntosh, a Baltimore Democrat, said. "He is in the process of trying to figure out some important changes in the way they have been doing business."

She said she told him the legislature would do what it could to help restore the $35 million cut. About two-thirds of that stems from cuts proposed by Hogan, while a third is due to growth in city property values, which are a factor in the main school funding formula.

Leading state Democrats have bristled more at Hogan's trims to education funding than any other of his proposals to curb state spending. Busch has vowed to find the money to replace it, and other leaders say they doubt that Hogan's budget will pass with the education cuts in place.

As part of its budget cutting, the school system could reopen the contracts so that the increases in pay do not continue at the same pace, some officials noted.

"I think the leadership of city schools will have to have some very candid conversations with the employee representatives to make sure we can afford to pay our bills on time and on budget," Ferguson said.

Sauls said the school board plans to make good on its long-term financial commitments, such as paying its most effective educators under union contracts and rebuilding the district's school buildings. But she said the district's operations will look different as a result of this budget.

"The budget that we pass will be a budget that causes some change and some pain to everyone," Sauls said. "But we're going to come through this just fine, and any changes that we make will make students, academics and the organization better off."

Baltimore Sun reporter Erin Cox contributed to this article.

liz.bowie@baltsun.com

egreen@baltsun.com

Copyright © 2017, The Baltimore Sun, a Baltimore Sun Media Group publication | Place an Ad
72°