Morning Must Reads: Predicting School Districts In Distress, Privatization and Hello Düsseldorf!

The Harrisburg Patriot-News reports this morning on a new study that predicts fiscal distress in Pennsylvania school districts thanks to state budget cuts.

In a report titled “Sounding the Alarm,” the Pennsylvania State Education Association describes the impact that state funding cuts and policies are having on school districts’ ability to meet the educational needs of students.

In it, the union calls on the Legislature and Gov. Tom Corbett to put more money into public schools and remove the limitations on property tax increases required by the state law known as Act 1.

But the Corbett administration suggests there’s no reason for alarm.

In a cringe-inducing moment from that Patriot-News story, a spokesman for the Corbett administration chose not to read the study before reaching into his trusty public relations rapid-response handbook:

Tim Eller, Department of Education press secretary, said having only one or two districts out of 747 public school entities encountering severe fiscal distress is no reason to sound the alarm.

From the study:

The authors of a study published recently in the refereed Journal of Education Finance conclude that districts that are relatively small, rely heavily on a single source of revenue, have little buffer within their budgets, and have relatively high amounts of debt are more likely than other districts to cut classroom expenditures by at least five percent in a given year (Trussel and Patrick, 2012). The strongest of these indicators of underlying fiscal weakness is heavy reliance on a single source of revenue.

Districts entered 2011-12 in varied financial shapes. Applying the model from the Trussel and Patrick study to Pennsylvania school districts, and combining those results with trend data from districts’ General Fund balances over the last few years, strongly suggests that many districts across the state faced elevated risks for making severe cuts to classroom services, even before the other cost and revenue pressures reviewed below are taken into account.

Clearly, some districts were struggling financially before the state budget cuts in 2011-12. The school districts showing the greatest underlying financial weakness by these measures had fund balances averaging 1.27 percent of total expenditures. They ranged in type from urban school districts, to small districts in the coal regions and Monongahela Valley, to rural districts in the central and western parts of the state.

The Altoona Mirror reports on efforts to stop the privatization of health care work in the Pennsylvania Department of Corrections:

As inmate populations increase across the state, the Corbett administration contends privatizing health care in state correctional institutions will help lower operations costs and help balance the commonwealth's budget.

But prison nurses and health care workers disagree and plan to fight back — many for their jobs.

From the report:

The Government Accountability Office has found that methods by which agencies and privatization consultants conduct projections and report contract costs can make cost savings appear greater than they actually are. According to a 2007 survey by the International City/County Management Association, 52% of governments that brought services back in-house reported that the primary reason was insufficient cost savings.

What is the weather like in Düsseldorf this time of year? Some Pennsylvania public officials are about to find out as they travel the world on a trade mission.

Lyon, then Paris. From there to Stuttgart and Dusseldorf.

That itinerary awaits Gov. Corbett and a small entourage of Pennsylvania government and business officials. They embark Saturday on the state's first overseas trade mission since Tom Ridge's administration...

[Former Gov. Mark] Schweiker's successor, Ed Rendell, was less enthusiastic — perhaps in part because of a report issued just after he took office in 2003. The scathing findings found that the Department of Community and Economic Development had grossly overstated export sales and jobs generated under Ridge and Schweiker...

Generally, however, Rendell "just didn't believe there was enough return on the investment of both time and money for him to go personally," said his former spokesman, Chuck Ardo.

Officials in Corbett's administration would dispute that view. Last year, Pennsylvania hit a record high $41 billion in exports, said Wilfred Muskens, Department of Community and Economic Development deputy secretary for international business development.

Of that $41 billion, $2.5 billion was in exports to France and Germany, said Muskens, who will join the governor's entourage. He said expanded business overseas translated into more jobs at home and more tax revenue for the state.

So exports to France and Germany are way up and that was before any high-level Pennsylvania officials traveled there. Imagine the possibilities after they visit! If the European recession drives down exports over the coming year, should we blame the visit?


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