Baltimore District’s Money Woes Dividing City, State

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More than a month after a judge ruled that the parties in a finance lawsuit should come up with plans to allow the Baltimore schools to spend up to $45 million more this year to help students deemed academically at risk, little has happened.

Lawyers for the American Civil Liberties Union of Maryland argued before Baltimore Circuit Court Judge Joseph H.H. Kaplan this past summer that the 90,000-student district was limiting students’ opportunities by working to pay off a $58 million deficit in its $914 million annual budget over two years.

School advocates and lawyers claimed that important academic programs and other services were being eliminated as the district struggled to clean up its financial house.

In August, Judge Kaplan void ed a schedule Baltimore school officials had worked out with city and state leaders to pay down the system’s debt.

The district’s plan to eliminate summer school and guidance counselors, increase class size, and reduce the number of experienced staff members had “reduced educational opportunities and impermissibly interfered with progress towards providing a constitutionally adequate education for Baltimore schoolchildren,” according to the Aug. 20 decision.

The Baltimore school district’s problems came to a head last winter, when Chief Executive Officer Bonnie S. Copeland fired more than 800 employees to address the district’s debt and cash-flow crisis.

Baltimore Mayor Martin O’Malley tapped the city’s rainy-day fund in March to help bail out the system with a $42 million loan.

Judge Kaplan, who gave the district until 2008 to clean up its deficit, also ruled that the state has continued to underfund the Baltimore city schools by a total of $439 million to $839 million since 2001.

The ACLU and the school district brought separate funding lawsuits against the state that were joined in 1996. At that time, state leaders and city school officials reached an agreement that gave the district more money in exchange for allowing the state to have more say in management decisions.

Judge Kaplan’s August ruling directed district, city, and state officials to draw up plans to help reinstate from $30 million to $45 million that the district used to help eliminate its debt. He order ed that those funds be reinstated this school year for targeted programs to help students at risk.

But Baltimore school officials say they don’t have the resources to comply with the order, unless the state steps up with more money. The state has appealed the ruling.

“We’re very disappointed that there hasn’t been much headway,” said Louis Bograd, an ACLU lawyer involved in the case. “There has been a lack of resolve by all of the parties to meet the needs of the children. We have been on a very slow path toward adequate educational opportunity.”

City-State Rift?

The stalemate appears to reflect, in part, increasing tension between city and state officials over the direction of the Baltimore schools. During the height of the financial crisis, Maryland Gov. Robert L. Ehrlich Jr., a Republican, seemed poised to help bail out the district in exchange for giving the state greater management control over the school system. ("Baltimore Bailout in Doubt; State Takeover on the Table," March 3, 2004.)

But Mayor O’Malley, a Democrat and a likely challenger to Mr. Ehrlich in 2006, abruptly rejected the governor’s offer, on the grounds that it gave up too much power to the state.

Instead, city officials came up with a $42 million loan last spring to help the district.

Patricia Welch, the chairwoman of the city school board, wrote to Gov. Ehrlich last month requesting a meeting to discuss the potential for additional money for the city schools. Ms. Welch pointed out that the state ended the last fiscal year with a $310 million surplus.

The governor declined her request for a meeting, and he noted concerns about the management of the city’s schools.

“We don’t have the funds,” Ms. Welch said in an interview. “We are treading on real dangerous water. We want to honor the judge’s ruling, but we are fighting with our partner, the state.

“It’s a very frustrating time,” she continued. “We’ve had to make cuts that are detrimental to the system.”

Bill Reinhard, a spokesman for Nancy S. Grasmick, the state superintendent of schools, denied any city-state rift. He said that Ms. Copeland and Ms. Grasmick have worked together closely.

“They talk all the time,” Mr. Reinhard said. “It’s a good working relationship.”

Vol. 24, Issue 06, Page 9

Published in Print: October 6, 2004, as Baltimore District’s Money Woes Dividing City, State
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