For city schools, a promising vision

Our view: Alonso's idea to leverage existing school construction funds could have an immediate impact — if politics don't derail it

January 29, 2012

The proposal to rapidly overhaul Baltimore's aging school facilities that district CEO Andrés Alonso presented to a state Senate committee last week represents one of the most important and innovative ideas the city has offered in recent years to break out of its cycle of poverty and disinvestment. Baltimore cannot flourish without high-quality public schools, and although students have made impressive gains in recent years, the city will not be able to attract and retain families if children are trying to learn in dilapidated facilities. The city and state are investing tens of millions of dollars a year in repairs and renovations, but that is accomplishing little more than slowing the decay of Maryland's oldest stock of school buildings. What's needed is a complete overhaul, and the approach Mr. Alonso has adopted offers the best chance to achieve it.

But it is also complicated. It is new to Maryland, and it involves a lot of moving parts. It requires authorizing legislation from the state, and there is a real risk that it could get lost in the shuffle of what is shaping up to be a busy General Assembly session. Legislators can't let that happen. The timing is right for this effort to move forward, and although the total scope of the project may seem daunting, the piece of it the General Assembly needs to consider right now is manageable.

Education advocates, led by the ACLU and other groups, have for years been pressing the issue of Baltimore's crumbling school buildings, a problem they have estimated would cost $2.8 billion to fix. Some classrooms are stiflingly hot. Others are freezing cold. Water fountains don't work or can't be used because of lead contamination. Electrical systems can't handle the number of computers some schools need. Roofs are leaky, and boilers go out. In all, about 70 percent of city schools are rated in poor condition. Not only do these problems present physical barriers to learning, but they send a message to students and parents that the city does not take seriously its effort to provide a quality education. That city students have achieved what they have under these conditions is remarkable.

What city officials and education advocates are proposing is this: A nonprofit or other third-party entity would sell a large sum of bonds and use the proceeds to engage in large-scale, systematic repair, renovation and replacement of city schools. A construction program of sufficient magnitude would create economies of scale and would take advantage of historically low costs for borrowing, labor and materials.

To make that work, Mr. Alonso wants to allocate existing state and city funding streams for school construction and renovation, plus some new ones MayorStephanie Rawlings-Blakeis proposing, to the new entity in the form of a block grant, which would be used to pay off the bonds over 30 years. At current rates, $1 million in annual funding could support about $15 million in borrowing. The school system estimates that it could raise as much as $1.1 billion in capital in the first phase of such an effort.

The politics

Where things get tricky is in the mayor's plan to extend and increase in size Baltimore's bottle tax, which was scheduled to expire at the end of this fiscal year, and dedicate the money to school construction.

The mayor has expressed support for the general idea of allocating school construction funds in the form of a block grant, but she has not specifically embraced the notion of using existing city and state capital funds — themselves the product of general obligation bonds — to leverage additional borrowing. City Hall and the schools remain in discussions over the logistics, advisability and legality of such a plan.

Meanwhile, Ms. Rawlings-Blake is pushing a bill to increase the bottle tax from 2 cents to 5 cents and to dedicate the resulting revenue, which she estimates at $10 million per year, to the school construction effort. Combined with the reallocation of some other funds, she believes that could support $300 million in borrowing.

Passing the bottle tax in the first place was politically difficult, and the beverage industry is gearing up for a fight to stop its extension. City Council President Bernard C. "Jack" Young, who abstained from a vote on the bottle tax two years ago but argued against it, has said this time that he will not stand in the way of a quick council vote on the matter. But the inclusion of the bottle tax as part of the plan may be a sticking point in Annapolis, where the beverage industry and liquor lobby wield significant influence.

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