Philly’s Schools Are in Trouble. The Answer Isn’t Higher Taxes

Philly’s public school funding needs bold solutions. / Photograph courtesy of School District of Philadelphia

I’m a big believer in education. A great school can transform a kid’s life — and a great school district can transform a city. 

Unfortunately, public schools in Philadelphia are facing a series of financial crises. First, because leaders in Harrisburg have been unable to finalize a state budget and release state funding for schools across Pennsylvania, the School District of Philadelphia (which gets 53 percent of its funding from the state) is being forced to borrow tens of millions of dollars just to keep operating. The impasse will eventually be resolved — sooner rather than later, I hope — but the interest on those loans is money we’ll never get back. 

But even when a state budget is finally approved, the school district will still be facing a long-term problem. The district is dealing with a large and growing annual deficit that’s projected to be $435 million in 2027 and $530 million in 2030.  

We have those deficits, by the way, even though we don’t invest enough in education. Philadelphia only spends about $17,000 per student, while our suburban neighbor Lower Merion spends  more than $31,000 per student and a competitor city like Boston spends $35,000. 

What can we do about all this? Having the state kick in more money would be great. But ultimately, if we want great schools in Philadelphia, we’re going to have to come up with more money for them ourselves.  

Which I think really only leaves us two options: 

• Raise taxes — i.e., ask the people and businesses who currently fund Philly schools to pay even more; or

• Expand the tax base — i.e., find more people and businesses to help fund Philly schools in the first place 

To me, it’s just common sense that we start thinking much more seriously about option number two. Expanding the tax base — by which I mean attracting more people and businesses to Philadelphia — not only means more money for schools in the long-term; it also means more jobs, more opportunity, and more energy in our city overall.  

While the Parker Administration laid out a plan to reduce businesses taxes, its timeframe for doing so — 14 years — is way too slow. If we want real change, if we want Philadelphia to be all it can be, we need to move much more aggressively.”

In contrast, raising taxes is a prescription for making our school-funding issue worse, as people and businesses decide they just can’t afford to stay in Philadelphia. 

As readers of my previous columns know, I believe the best way we can expand our tax base is by lowering our business taxes. Earlier this year, the Tax Reform Commission (on which I served) released a report showing that business taxes in Philadelphia are significantly higher than in surrounding counties, as well as cities like Boston, Baltimore, and New York City. This, in turn, has hurt our job and population growth, which ultimately undercuts the amount of money we have to spend on all sorts of things — including better schools. 

While the Parker Administration laid out a plan to reduce businesses taxes, its timeframe for doing so — 14 years — is way too slow. If we want real change, if we want Philadelphia to be all it can be, we need to move much more aggressively. 

When it comes to schools, Philadelphia is blessed to have many education advocates who are deeply committed to improving things for our kids — who want to see us investing in our kids the way Lower Merion and Boston invest in theirs.  

I admire their passion and share their end goal, 100 percent. 

But I invite those leaders to consider thinking differently about how we get to that final destination. We owe it to the city. We owe it to the kids. We owe it to the future.