A shock to the system

February 24, 2004

THE SWEEPING plan to straighten out the Baltimore school system's finances, financial adviser Robert R. Neall was saying last week, "depends on the cooperation of people inside the organization and the forbearance of people outside the organization." Yesterday he quit in frustration over his inability to win the full backing of the school board. The lack of cooperation now ensures the end of forbearance.

Mr. Neall's resignation is a shocking blow to the city's schools. With a $58 million deficit, and a $58 million cash-flow problem, with a $42 million loan from the state in the balance, with angry teachers having twice rejected pleas for help and with angry parents demanding the resignation of the school board - the system has now lost the one man who had a plan, however painful it might have been, for putting things right again.

He was neither a savior nor a knight in shining armor, but Mr. Neall made possible whatever credibility the system had in Annapolis, where he once served as a state senator. By withdrawing, he withdraws that credibility.

Gov. Robert L. Ehrlich Jr. made it clear yesterday, through a spokesman, that the school system's recovery plan as presented to his office Friday fell short of what was needed if the big state loan was to go through.

Mr. Neall effectively endorsed that judgment in his resignation letter. "I do not believe we have done enough in cost containment measures ... to convince the state we are stable enough to qualify for the assistance they have offered," he wrote.

Members of the school board acknowledged that they modified Mr. Neall's original draft before sending it to the governor. That is evidently what prompted his resignation.

What's the next shoe to drop? Plenty of people will be calling on the members of the school board to resign, and Mr. Neall had to have known that would happen. The board in fact took insufficient steps to head off the financial debacle, and the time may well have come for its wholesale replacement - but this is not the way to bring about a fundamental restructuring of a system in crisis.

Mr. Neall - peremptory at times, always holding his cards close to the vest - sometimes looked as though he was spoiling for a fight. Yet members of the board seemed unable to understand just how serious the system's financial predicament had become.

The best possible course for the city's schools would be to enlist - and quickly - an outside consultant with a proven record, someone on the order of Paul Vallas, CEO of the Philadelphia school system (and formerly of Chicago), who could tackle what needs tackling here without political baggage or an ax to grind.

The board doesn't have much of a leg to stand on. It will be up to the governor and Mayor Martin O'Malley to seize the initiative.

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