Stopgap Borrowing For Phila. School District Moves Forward in City Council
By Mike Dunn
PHILADELPHIA (CBS) -- While state lawmakers debate a Philadelphia cigarette tax to provide more funding for Philadelphia schools, a City Council committee has signed off on a measure to provide $30 million in stopgap funding to the cash-starved school district.
If approved, the cigarette tax would provide an estimated $87 million per year to the school district. But because approval of that tax was delayed from last spring, the district will only see about half that amount for this school year, leaving a big short-term gap.
Today, City Council's Finance Committee has approved a plan in which the city will borrow $30 million, then "gift" the money to the district to cover the new gap.
Testifying was Matthew Stanski, the district's CFO:
"This additional thirty million has already been built into our current year budget and is essential to prevent a further deterioration of services to our under-resourced schools," he said.
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Debt service on this borrowing will be paid for with proceeds from the city's now-permanent sales tax extension.
The plan will go to the full Council for a vote next month.
Council approved a similar plan last spring for a $27-million borrowing that allowed the district to pay its bills by the end of that school year.