Central office layoffs, elimination of hundreds of teaching and staff positions in a "surplus pool" and other savings totaling $63 million are part of Baltimore schools CEO Gregory Thornton's plan to shrink an estimated $108 million budget deficit.
In an interview with The Baltimore Sun, Thornton outlined a plan to chip away at a deficit run up by union contracts, pre-kindergarten expenses and an overhaul of the district's infrastructure — and made even larger due to $35 million in proposed cuts in state funding.
Thornton has previously been mum on the overall size of the deficit and his strategies for eliminating it. In recent weeks city officials said they were "shocked" to learn of the shortfall and complained they had been kept in the dark about the financial troubles.
Thornton said he has "not been asleep" and has identified in-house savings while lobbying officials to restore state funding. He said he did not want to "slash and burn to get to a number."
Thornton said about $15 million can be saved by eliminating the majority of the district's surplus pool of employees — full-time teachers and staff who are on the system's books, but have no permanent placements.
The number in the pool varies during the school year — as of March 3, the system had 209 "surplus" positions. The staff members are deployed to schools, but Thornton said they're an extra set of hands the district can no longer afford.
Thornton said he'll also reorganize the central office, resulting in an unspecified number of layoffs. The system hired a consultant Thornton said has brought to light inefficiencies such as analysts in different departments doing essentially the same job.
"They found things like the fact that I have five call centers," he said. "IBM doesn't even have five call centers."
Union leaders were cool to the idea of losing jobs. Marietta English, president of the Baltimore Teachers Union, said Wednesday through a spokesman: "It is very disappointing that we have not had the opportunity to discuss this plan involving the termination of BTU members.
"Our contract addresses how reduction in force is conducted, so we look forward to conversing with Dr. Thornton about how this will be carried out," she said.
Public School Administrators and Supervisors Association President Jimmy Gittings, who represents administrators, said of the surplus pool that 20 are members of his union, and he will look for those staffers to be reassigned to schools. He acknowledged some members would also be cut in the reorganization.
"I've said this is unacceptable to me," Gittings said. "I am willing to, as a last resort, present to our membership the possibility of renegotiating the contract to look at no raises this year to avoid any layoffs."
Thornton defended staff reductions, saying, "We have a strategy that I think is so comprehensive that it far exceeds a cutting of the budget, it begins to lay a framework of the future of our city.
"Here's my challenge: create a world-class school district for kids, in a business framework with long-term sustainability," he said.
Salary increases under a new teachers union contract have applied pressure on the budget. Since 2012, classroom teacher salaries have risen by $10 million while the number of teachers decreased by 259.
Lawmakers who have been waiting to hear Thornton's plan said it seems he is heading in the right direction.
"I think it's important for him to demonstrate that the deficit he has projected is under control," said City Councilwoman Mary Pat Clarke, who chairs the City Council's education committee.
"We're working hard in Annapolis to resuscitate the $35 million, and we need to demonstrate that our own house is in order here in Baltimore," she said. "So, he's right to be working on that."
Thornton also wants to negotiate with unions to curb health care costs, which rose by $4 million last year and $7 million the year before. He said packages need a "complete reorganization," but anticipates the district could save $2 million to $3 million just by cutting off separated spouses and overage children.
But altering health care provisions could be a tough sell.
"Baltimore administrators have the best health care in the country," Gittings said, adding the only way he could consider a change would be with approval of his entire membership.
Thornton said other cuts include capping the number of temporary employees, an expense that cost the district more than $4 million so far this year, and renegotiating contracts to trim transportation costs. He called a $5 million allocation to transport some students in taxis an "outrage."
He also identified $15 million low-hanging fruit" that could be cut in meals, trips and costs incurred to use up money at the end of a fiscal year.
"A lot of this is just cultural, and we just need to start asking, 'Does this [purchase] impact kids,'" he said. "If you fix the small stuff, the big stuff will take care of itself."
He said nearly $15 million in savings was found by ending a practice that allocates a per pupil amount to schools even for students that have transferred to another school — essentially paying for those students twice. Thornton said that was the system's way of not penalizing schools when students transfer, but is a practice that has to change.
"You can't have it both ways," Thornton said.
He also wants to revisit a formula by which charter schools get funding — about $9,000 annually per pupil — to compensate for the fact that those schools don't use central office services.
Even with Thornton's proposed $63 million in reductions and if the state restores the $35 million, there will still be a $10 million deficit. He said he would look at additional cuts in areas he's already identified.
Thornton has not presented a budget for the fiscal year beginning July 1, but last year's allocation was $1.3 billion.
He said the upcoming budget will seek $14 million for new programs. He wants to put art and intramural sports in schools and fund "lead teachers" in struggling schools. He also wants a $5 million expansion of academic technology.
"I'm not going to have a budget that just cuts," he said. "I have to have investments in kids."
Schools will feel a crunch in the coming budget year, Thornton said, because the amount of per-pupil funding will remain flat but costs, such as personnel, will increase.
"What I really feel good about is that we have not left any stone unturned," he said.
Shanaysha Sauls, president of the city school board, said the board believes Thornton is "being really strategic, surgical, in terms of thinking about cost savings." It is a skill set that contributed to his appointment, she said.
In Milwaukee, where he served as superintendent until last year, Thornton faced several shortfalls — including one that topped $100 million. That led him to cut nearly 1,000 positions, lay off 500 educators — he brought some back the following year — increase class sizes and eliminate transportation for elementary school students.
And as a result of Wisconsin law that all but did away with collective bargaining, he was able to renegotiate health benefits, freeing up millions.
Sauls said the board has not received a comprehensive plan from Thornton, but he's on the right track.
"We want to make sure that people understand that we can pay our bills, and we pass a balanced budget every year," she said. "He's thinking about sustainability, and the expenditures that are way out of control. That's the right approach."