Dear Neighbors:
Thanksgiving is one of my favorite holidays – I hope you are looking forward to this “feel good” opportunity to share a meal with family and friends. In this week’s letter, I discuss the settlement of the financial dispute between the Providence Public Schools and the City of Providence.
A. The Court Dispute
As I explained in my November 10 letter, the Crowley Act requires the City to increase its public school expenditures during the State takeover, but the parties disagree about the amount of the required increase. Matters came to a head this year when the School Department’s budget contained an $11 million gap and the prospect of canceling high school bus passes and athletic programs. Two weeks ago, the Superior Court ordered the impoundment of $8.5 million of State aid to Providence, scheduling a hearing for this past Wednesday to rule on final relief concerning the School Department’s claims against the City. The resulting uncertainty induced the parties to negotiate a settlement they both could live with.
B. The Parties’ Settlement
The settlement’s terms require the City to (1) fund the School Department’s current year $11 million gap, (2) pay $4 million for last year’s gap, (3) contribute $147 million to the 2025-26 School Department budget and (4) establish $147 million as the baseline for the 2026-7 school year’s City contribution, subject to a percentage increase based on the State’s increase of school aid. The City announced that it could fund the $15 million current and retrospective payments without raising taxes, but that next year’s local appropriation will require an increase in the tax levy of more than 4%, which will require State legislative approval pursuant to the Paiva-Weed Act.
C. Short-Term Benefits
I believe the parties’ agreement was the best possible outcome from this dispute. Students and teachers can now return to their vital project of education knowing that there will not be another budget crisis for the rest of this year and the following two years. City taxpayers can take comfort in the agreement’s resolution in terms that the City can afford, while also providing greater accountability through its requirement that the School Department undergo an independent financial audit.
D. Long-Term Challenges
With the resolution of this dispute, we must return our attention and sense of urgency to the long-term challenges facing the Providence Public Schools and the City of Providence.
a. The Providence Public Schools
The ambitious, but also critically necessary, goals of the Turnaround Action Plan developed as part of the State takeover are not being met. As many of you know, I chaired a Senate study commission that reviewed best practices in urban school districts. Our Report found that our educators need to adapt to the greater demands of educational attainment and the varied needs of our students through a relationship of shared accountability between and among labor and management. The Report outlines the components of that relationship, which can move forward with reforms to the collective bargaining agreement currently under negotiation.
The recent crisis also highlights the need for greater resources for our educators and students. Were Rhode Island to emulate the school aid funding formula of our neighbor Massachusetts, Providence Public Schools would receive tens of millions of dollars of additional State aid beyond what it currently receives. Rhode Island’s children need a Constitutional right to education. Absent that, I will continue to work with my Senate colleagues to bring needed changes to Rhode Island’s education aid funding formula. Our State’s successful future depends upon providing our children with the quality public education they deserve.
b. The City of Providence
The City’s increased obligation to fund the Providence Public Schools is not the only stress on its long-term financial stability. While serving on the City Council, I chaired a working group whose Report described the City’s unfunded pension obligation as “Providence’s version of the global warming crisis, an existential threat looming on the medium-term horizon that becomes more difficult to solve with each successive year of inaction.” That crisis has only grown worse, as increasing required pension contributions continue to command an increasing share of the City’s budget. That Report, as well as a later Report by Mayor Elorza’s working group presented a menu of possible responses, all of which involved difficult choices. (For various reasons, some of those options are no longer available today.) The available choices only become more difficult with each passing year.
E. Conclusion
Ever since you elected me to the City Council fourteen years ago, my greatest concerns in elected office have been the long-term success of our City and of our public schools. As I have noted before, the recent budgetary crises in both the Providence Public Schools and the City of Providence would not have occurred under the education aid funding formula used in Massachusetts. The future of our State depends upon the success of our capital city, and our city’s successful future in turn depends upon providing a quality public education to our children and a strong financial foundation to our City government.