Council leaves school funding largely to state lawmakers

Posted: June 20, 2013

Philadelphia City Council plans to pass the city's budget and begin the summer recess Thursday with the task of solving the School District's financial crisis left largely in the hands of state lawmakers.

That would turn the tables from the last two years, when Council approved taxes that raised $125 million for the schools without the state's contributing any money.

This month, Council unanimously passed a $2-a-pack cigarette tax that would raise $46 million for the schools, but the state also must approve that levy.

The Republican leadership in Harrisburg has repeatedly said winning approval was "an uphill climb," but Council President Darrell L. Clarke said Tuesday that he was "an eternal optimist."

The cigarette tax, coupled with improved tax collections, could provide more than $74 million for the schools, "far exceeding" the district's request, Clarke said.

"From our perspective, we've done our part," he said.

The district is counting on $60 million from the city, $120 million from the state, and union concessions to close a $304 million budget shortfall and avoid nearly 3,800 layoffs.

If the state rejects the cigarette tax, Council would have to go to "Plan B," which Clarke would not describe. Council cannot raise or create a tax after the start of the fiscal year on July 1, so money would have to be found elsewhere in the budget and transferred to the schools.

"All of our apples have pretty much been put in that cart," Clarke said. "If somehow that doesn't materialize . . . we'll try to figure out what we do with a hopefully never-realized Plan B."

A bill to approve the tax, introduced by State Sen. Anthony Hardy Williams (D. Phila.), has not yet had a committee hearing.

Williams confirmed Tuesday that a plan to cobble together $100 million for the schools was being negotiated in Harrisburg, but he said details were being negotiated.

Mayor Nutter and School Superintendent William R. Hite Jr. traveled to Harrisburg on Tuesday to lobby for more state funding and the cigarette tax authorization.

Mayoral spokesman Mark McDonald said "Council has done what it needs to do," but he said he did not want to discuss "hypotheticals" such as the state's not approving the cigarette tax.

"This is our strategy," he said. "This is game on. Now is the time."

With Council wrapping up its business this week, the proposed increase in the liquor-by-the-drink tax can be declared dead. Raising that tax had been another avenue to secure school funding, but there was too little support in Council to move the proposal out of committee.

Council still could pass a bill sponsored by Councilwoman Maria Quiñones Sánchez to increase the business Use and Occupancy tax for the second year in a row. Sánchez said she would decide whether to call for a vote Thursday morning.

She said she was "not as optimistic" about getting state approval for the cigarette tax.

If she does run her bill, she would put some of her colleagues in the difficult position of choosing between funding schools and angering businesses fighting another tax hike.

"I don't take that lightly," Sánchez said. "At the same time, I'm more committed to ensuring the School District has money to avoid the current situation."


Contact Troy Graham at 215-854-2730 or tgraham@phillynews.com, or follow on Twitter @troyjgraham.

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