The Philadelphia School District, which has a $2.18 billion budget, would receive about $86 million in new basic education funding.
The proposal comes as coalitions around the state rise up to call for more spending on Pennsylvania's 501 public school districts. Such voices have been heard for decades, but are bolstered now by the fall release of the legislature-commissioned "Costing Out" report, which said the state underfunded its districts by about $4.38 billion.
With the nation possibly lurching toward recession, the Rendell plan likely will face intense scrutiny in Harrisburg, even though the administration sources say they can provide the funding without a tax increase through natural revenue growth.
But some question any additional spending.
"It's time for Pennsylvania taxpayers to get value for their dollars," said Steve Miskin, a spokesman for the Republican caucus in the House. "Kids are graduating unable to read, write or do math. More money by itself is not the answer."
On the other side are public-education advocates, who just last week held a rally at a Philadelphia school and called for the Rendell administration to raise basic education funding by $1 billion statewide. The amount of the proposal could disappoint them.
"It should be a significant down payment so that we really stop failing our kids and stop failing ourselves and our future," Shelly Yanoff, executive director of Public Citizens for Children and Youth, said after the rally, which drew about 50 representatives of education advocacy groups from around the state.
But the administration sources said this would be just the first step. The governor will call for similar increases in each of his next two budgets until he leaves office in 2011.
And he will outline a six-year plan that, if followed by the next governor, would boost basic education funding $2.6 billion by the final year, raising the state's share of education spending from 37 percent to at least 44 percent.
But that's still only about half the new funding called for in the study.
Under the plan, districts with more children living in poverty and students learning to speak English would get higher increases - a formula first outlined in the "Costing Out" study. Other factors, such as the cost of living, a district's size, and enrollment growth, also would be considered.
Not since 1991 has such a new formula been proposed, the sources said.
Since then, education advocates have bemoaned increasing disparities in spending among school districts. Last school year, for example, the Lower Merion School District in Montgomery County planned to spend $21,310 per student, compared with $9,997 in Upper Darby in Delaware County.
Under the Rendell plan, no district would be shut out of an increase. Even the wealthiest school system is guaranteed at least 1.5 percent, the sources said.
A quarter of the districts in the Philadelphia area - 16 of 64 - already are adequately funded and would benefit the least, according to the study.
Only the funding increase would be distributed under the new formula. The existing $5 billion would continue to be allotted under the old formula, which also in part takes into account poverty, growth, size and tax effort.
The plan would be a boon to some area districts, including Upper Darby, which would get the highest percentage increase in the state at 22 percent.
And the cash-strapped Philadelphia School District - the state's largest, with 167,000 students - would get a 9.6 increase in its basic subsidy. The $86 million would be nearly 30 percent of the new money statewide.
Administration sources declined to release increases for other area districts.
Much of the new money would come with restrictions. Districts would have to spend it on improving the academics for their worst-performing students.
That could include after-school tutoring, a longer school day or year, prekindergarten and full-day kindergarten classes, and a new curriculum.
Recruiting incentives for principals and teachers and performance pay incentives for principals and superintendents also would be permitted.
Districts would have to outline for the state Education Department how they would spend the money. Those with failing schools would have a higher hurdle: They would need approval before spending the money.
Since Rendell became governor in 2003, the largest increase in basic education funding was just shy of 5.9 percent, approved in 2006. Other increases were in the 3.5 percent range. Not since 1991 has there been a larger proposed percentage increase in basic education funding, the administration sources said.
The "Costing Out" study found that while Pennsylvania spends nearly a third of its budget - almost $9 billion - on education, it ranked near the bottom nationally in 2004-05 in the percentage of public-school state education spending it provided.
Almost all districts in the state - 474 of 501 - are underfunded, according to the study, and should be spending more.
Rendell's budget also will propose increases in education spending in other areas, including a 17 percent increase in prekindergarten, a 3 percent increase in special education, an 11 percent increase in elementary school science, and a 20 percent increase in dual-enrollment classes that allow high school students to take college-level classes, the sources said.
Contact staff writer Susan Snyder at 215-854-4693 or firstname.lastname@example.org.