Judge orders rise in schools' budget

Slower repayment of loan, deficit makes $30 million available this year

August 21, 2004|By Liz Bowie and Mike Bowler | Liz Bowie and Mike Bowler,SUN STAFF

A Baltimore Circuit Court judge ruled yesterday that the state is still not adequately funding the city schools by hundreds of millions of dollars and ordered that a patchwork of actions be taken to ensure an additional $30 million to $45 million is spent on the city's classrooms this year.

Judge Joseph H.H. Kaplan also rejected state school Superintendent Nancy S. Grasmick's informal suggestion that the court appoint a trusteeship to take over the schools, saying there is "no reason for a major restructuring." The system, he said, is operating under new management and should continue.

Ruling in favor of education advocates and parents in a pair of decade-old lawsuits, Kaplan said that requiring the school system to pay down a $58 million deficit in two years will force harmful cuts in classroom programs in the coming school year.

He noted that under current belt-tightening, class size is expected to rise by as many as four students per teacher and that summer school was virtually eliminated.

Kaplan made clear he believes the situation is urgent and ordered the parties in the suits - the state, the city, city schools and education advocates - to return to court in a month with a plan for finding more money for the schools and detailing how it will be spent.

His ruling, filed late yesterday, came quickly: only two weeks after four days of court hearings that examined the effect of school finance issues on education programs.

In the 74-page opinion, Kaplan urged the city and state to increase funding to city schools this year, saying the state could accelerate its graduated payments under the Thornton legislation that is expected to provide about $258 million more a year for the schools by the 2008 fiscal year.

"The children of Baltimore City should not have to wait another three years for adequate funding," Kaplan said.

But because the judge does not have the authority to order a legislature or city council to appropriate funds, he provided an alternative to make sure the schools get at least $30 million this year.

Repayment changes

First, he struck down a portion of a state law passed earlier this year that requires the city schools to pay off the deficit in two years, and he got rid of the same provision in an agreement between the city and the school system that provided for a $42 million loan. Then, he ordered that the $58 million deficit be paid off in four years instead of two.

Currently, the school system plans to pay off the deficit by saving $45 million of the revenues it receives from the city and the state this year. According to Kaplan, "the result for the moment is a financially stable, yet educationally inadequate `barebones' system."

Paying off the deficit more slowly, as he suggests, would automatically pump more money into the budget. So without getting more revenue from the state, the school system could spend more in the classroom.

Officials balk

Both Mayor Martin O'Malley and Gov. Robert L. Ehrlich Jr. were cool to the idea of putting more money into the schools this year, and O'Malley said he would likely appeal the decision.

"It is a dysfunctional system," Ehrlich said. "It has been for many years. This case has been open for many years, churning legal fees for no apparent reason. People are very frustrated with the system."

The state's funding of the city schools has been a court issue since 1996 when City Hall relinquished some authority over the schools to the state in return for five years of increased aid.

In 2000 when the debate over how much more the city schools should receive in state funds was renewed, Kaplan ruled again, saying the school system should get $2,000 to $2,600 more per pupil. Later, a statewide commission charged with examining inequities in education funding essentially concurred.

As a result of the so-called Thornton legislation, all 24 Maryland districts are scheduled to get an increase in funds from the state in each of the next three years, with Baltimore receiving the largest share.

In yesterday's opinion, Kaplan said that the state has been too slow in increasing funding and that city schools have been "unlawfully underfunded" by an amount ranging from $439 million to $835 million in the four years since his ruling.

Kaplan noted that two of the state's wealthiest districts, Howard and Montgomery, were slated to receive $391 million in Thornton funds, and that the Thornton legislation was "front-loaded so that richer districts with fewer needs received greater increases in the earlier years."

Baltimore's first "big contribution" from Thornton, he said, begins this year.

Management concerns

In the hearings, the state had argued that more money wouldn't help. What the struggling system needed, Grasmick testified, was better management.

But Kaplan was cool to that argument. He said management problems "are no defense to the state's ongoing and continuous violation of its obligations under the Maryland constitution."

Kaplan delineated how the city and state should oversee the system.

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