1,000 layoffs at city schools

Facing $52 million deficit, board will slash payroll and restructure system

Teachers will be last to be cut

New CEO looks at halving headquarters personnel

November 13, 2003|By Tanika White and Liz Bowie | Tanika White and Liz Bowie,SUN STAFF

Vowing "sweeping radical change" to deal with a budget emergency, Baltimore school leaders will lay off up to 1,000 employees - the largest reduction in more than 20 years.

New Chief Executive Officer Bonnie S. Copeland said yesterday that the system would first attempt to create a "smaller central administrative staff," at its North Avenue headquarters - possibly reducing personnel by up to 50 percent - and then look to make cuts elsewhere.

Teachers would be the last to go, she said.

"I am very, very hopeful that we will not have to [lay off teachers]," Copeland said.

"I am very, very hopeful that the students in the classrooms won't realize any hardships."

Robert R. Neall, a former state senator who was brought in by Copeland to analyze the system's finances, said, "A sweeping, radical change in the corporate culture is essential to solving this problem."

The system expects to cut 800 to 1,000 of the district's 12,000 employees, a possible 8 percent reduction in staff, by January.

State schools Superintendent Nancy S. Grasmick called the cuts "unprecedented."

"We are going to see a huge downsizing of administration," she said.

Although the system had been promising for more than a year that it would rectify its financial problems, until yesterday, no sweeping action had been taken.

Mayor Martin O'Malley called yesterday's severe action "long overdue."

"The time for passing the buck has passed. The time for dodging hard decisions has passed," he said.

O'Malley applauded school system officials for finally doing something that is best for the city's 92,000 schoolchildren, "not what's most convenient for the politics or the pocketbooks of the adults."

`Serious commitment'

The sudden decision to cut staff - and possibly programs and resources - is an urgent attempt to re-structure the school system's operations, officials said.

"This is a serious commitment to bring fiscal and organizational stability to this system," school board Chairwoman Patricia L. Welch said.

"We needed to act immediately and decisively to avert a financial crisis."

School system officials have tried to chip away at the district's worsening financial situation for more than a year.

What was a $19 million budget deficit at the end of the 2002 fiscal year has grown into a $52 million cumulative deficit.

Known for years

"It's been known for years that we had to take serious action in order to put our system in position to perform," school board member Brian D. Morris said.

"For whatever reason, there's been direction [from the board] with no action."

That had to change, Morris said.

Neall said the school system budgeted this year for $542 million in payroll expenses but is already on course to exceed that by $24 million.

He said, however, that the school system will not permit the cumulative deficit to grow because it will be taking the measures necessary to contain costs.

The layoffs introduced yesterday represent one part of an 18-month plan that Neall and board members have devised to achieve a balanced budget by June 2005.

Because 80 percent of the system's $893 million operating budget is payroll, that is where the largest reductions must come, officials said.

Copeland has asked her top administrators to come up with plans for operating their departments with 50 percent of the current staff.

Officials will look first to cut workers who are not affiliated with any of the district's five unions, temporary employees, consultants and contract workers.

Teacher surplus

The new CEO also said she would press principals today for ways to slash expenses in the schools.

The system has a surplus of teachers because it hired too many this summer. Those who are working without a current teaching certificate would be among the first to go.

Next, administrators would consider possible layoffs in high schools and middle schools, where enrollment tends to drop halfway through the school year.

If necessary, Copeland said, the size of elementary school classes might have to be increased.

"The remaining portion of our budget is also being scrutinized," Copeland said. "If we can find savings in the other 20 percent of the budget, then there will be fewer layoffs.

"So everything at this point is on the table. It's clear that we cannot anymore do more with less. We will have to do less with less."

Promises of reform

Over the past six months, school officials had pledged to the public that they had resolved the system's financial difficulties and were on track to reduce the deficit by $21 million by July 2004.

Just last month, the board grilled former Chief Financial Officer Mark Smolarz on the status of the finances, saying that administrators would be fired if they did not adhere to their budgets.

Yesterday, school leaders tried to explain how the financial situation had deteriorated so quickly that it warranted laying off as many as 1,000 people.

Officials said part of the blame fell on the administration of former CEO Carmen V. Russo.

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