Dec 12 Pennsylvania declared two school
districts financially distressed on Wednesday, appointing
separate officers to draft recovery plans for each of them. The
two districts are the public school systems of Harrisburg and
State Education Secretary Ron Tomalis determined that both
districts were in states of moderate financial recovery. The
districts can appeal the determination in commonwealth court.
The school boards retain control of their finances, but they
have 90 days to work with the newly appointed chief recovery
officers to devise plans to restore fiscal stability, according
to education department spokesman Tim Eller.
School boards can gain access to state loans if they agree
to a plan. If not, school districts could be forced into
receivership after a year if they can't resolve their finances.
Two other districts -- Chester Upland and Duquesne City --
have also found to be in distress since the state legislature
passed a new law in June. The law gives the state a way to
intervene when school districts meet certain measures of
Harrisburg's schools, for example, received three advances
Hilary Russof basic education funding from the state in the
previous five school years, Eller said.
In March 2009, Harrisburg's school district received an $11
million advance. It then received advances of $7 million in July
2010 and $4 million in May 2011, he said.
The Harrisburg district had $266.6 million of debt
outstanding as of July 1, 2010, Eller said.
A separate law, Act 47, governs cities, towns and counties
that are struggling financially in Pennsylvania.