Budget & Finance

City, Not State, to Lend Money To Baltimore Schools

By John Gehring — March 17, 2004 1 min read
  • Save to favorites
  • Print

Mayor Martin O’Malley of Baltimore backed away last week from a deal that would have given the state much greater authority over the city’s school system in exchange for a loan to keep it afloat.

The mayor’s decision to support a City Council vote to provide the schools with a $42 million loan, drawn from the city’s rainy-day fund, was an unexpected departure from his support for an earlier bailout plan. The turnabout stunned Maryland’s governor and state legislative leaders.

For weeks, Mayor O’Malley, a Democrat, and Gov. Robert L. Ehrlich Jr., a Republican, have been negotiating, along with city and state education leaders, to come up with a plan to provide aid for the 90,000-student Baltimore schools. The district faces a cash-flow emergency that could leave it insolvent by the end of this month, along with a $58 million shortfall in its $914 million budget.

After Mr. Ehrlich rejected the district’s plan for accountability in handling its finances—a measure the governor said was needed before the state provided a loan—his administration began pushing for a plan to form a public school “authority” to oversee the district. (“Baltimore Bailout in Doubt; State Takeover on the Table,” March 3, 2004.)

Local Criticism

But the plan faced increasing criticism from Baltimore legislative leaders, who saw it as handing too much power to the state, even as the mayor and governor agreed on March 5 to move ahead with the compromise plan.

Mayor O’Malley said his decision to change course and support a city councilman’s proposal to tap the $56 million rainy-day fund came after the mayor decided the city was in a better position to maintain local accountability.

“I have come to the conclusion that we can better reform Baltimore’s school system by taking more responsibility, not less,” Mr. O’Malley said in a March 9 statement.

The loan must be approved by the city’s Board of Estimates.

Henry P. Fawell, a spokesman for the governor, said the mayor’s decision reflected Mr. O’Malley’s shifting positions on how to handle the crisis.

“It’s back to square one,” Mr. Fawell said. “We are back to where we began, which is the city taking responsibility for the gross negligence of the city school system. The governor wishes them well.”

Related Tags:

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Personalized Learning Webinar
Differentiation That Delivers: Proven Practices From High-Growth Districts
Make every minute count. Proven strategies from educators and leaders driving real student growth. Save your seat!
Content provided by i-Ready, Curriculum Associates
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
College & Workforce Readiness Webinar
From Exposure to Experience: Designing Accessible Work-Based Learning
Learn how schools can create meaningful experiences that help every student build skills, connections, and a clearer path to their future.
Content provided by Project Lead The Way
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
School & District Management Webinar
A Tale of Two School Districts: Forecasting Enrollment
Forecasting enrollment is hard. Here’s how two different districts are navigating times of change with data that considers the whole picture.
Content provided by Zonda Education

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Budget & Finance Trump's School Choice Program Could Push Public Schools to Charge New Fees
Districts that charge new fees will likely confront tricky logistical, legal, and philosophical questions.
9 min read
A tutor helps students at Benjamin O. Davis Middle School in Compton, Calif., on Feb. 6, 2025.
A tutor works with students at Benjamin O. Davis Middle School in Compton, Calif., on Feb. 6, 2025. The federal tax-credit scholarship program that launches next year can cover select expenses for public school students, including for tutoring. But to receive revenue from the program, public schools could have to set up systems to charge fees that the federally bankrolled scholarships can then cover.
Eric Thayer/AP
Budget & Finance As Student Meal Debt Soars, School Districts Launch Their Own Fundraisers
Meal cost increases, changes in federal food assistance eligibility may lead to more unpaid balances, experts say.
4 min read
Collage of various articles of clothing with clipped clothing descriptions and prices. Partial face of a kindergarten male eating a piece of fruit with other food items clipped such as pizza, bananas, and an apple. Subtle typography in the background shows menu items with prices.
Collage by Gina Tomko/Education Week + Getty
Budget & Finance Voter Support Dips as Schools Seek to Borrow More Money
Voters will decide on 373 school district bond issues this November. What's behind the requests?
5 min read
Collage of school construction, blueprints and money images. School funding, bonds and construction.
Collage by Vanessa Solis/Education Week + Getty
Budget & Finance See the School Supplies Teachers Buy for Students
Teachers share what they purchase the most for students amid rising school supply prices.
1 min read
Back-to-school supplies are displayed for shoppers at a Target store as retailers prepare for the annual back-to-school shopping season, on July 29, 2026 in Baltimore.
School supplies are displayed for shoppers at a Target store for the annual back-to-school shopping season, on July 29, 2026 in Baltimore. Paying for school supplies has become more challenging amid rising prices.
Robyn Stevens Brody/Sipa USA via AP