An Act 47 for Fiscally Distressed Schools Takes Shape

HARRISBURG – School districts are being evaluated this fall to determine if they belong in fiscal watch status, a new category for designating local government entities on a slippery financial slope.

The state Department of Education is identifying which districts need monitoring because of such factors as low cash on hand or limited ability to generate tax revenue and take on more debt as it implements the School District Financial Recovery Law enacted in July.

The law establishes a state oversight process for school districts similar to what Act 47 offers for fiscally distressed municipalities.

Four urban districts – Harrisburg, York City, Chester-Upland and Duquesne – have received preliminary declarations as districts in financial recovery, the ultimate distress category that triggers the appointment of a chief officer to develop a recovery plan.

Harrisburg and York are contesting their declarations, and hearings have been scheduled this month to review the cases, Education Secretary Ronald Tomalis told the Senate Education Committee last week.

Only nine districts can be in financial recovery status at any one time under the law.

Click here to read the full article by Robert Swift, published in The Times-Tribune (October 1, 2012).

 

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