March 15, 2004

Baltimore Mayor Martin O'Malley, after a long weekend of talking with parents, teachers and legislators, came to the conclusion "that we better reform Baltimore's school system by taking more responsibility, not less." This ended a long back and forth negotiation and discussion with Maryland Governor Robert Ehrlich, Jr. over who would financially save the city's bankrupt public school system.

In the end, the mayor on March 8 decided not to accept a state bailout offer by Governor Ehrlich. Instead, Mayor O'Malley decided to use most of the city's rainy-day fund to pay the school system's bills in conjunction with a $16 million loan from the local Abell Foundation.

O'Malley and other local officials determined that it was their responsibility to rectify the problem and not the state's. It was more important to remain in control of the city's schools. O'Malley will now have to focus on correcting the weaknesses in financial oversight that allowed the school system to incur this deficit. He stated that, "this means more local control, more local responsibility, new accountability that was left out of the original city/state partnership, and reform of the school board to make it more accountable."

As a result of the mayor's decision, Baltimore's City Council voted on March 8 to approve an emergency loan of $42 million to the troubled school system. This move eliminates any immediate threat of a state takeover of the city's schools. With this infusion of cash, the system averts widespread layoffs and teacher pay cuts as a result of a $58 million deficit discovered by the recently appointed school administrator.

O'Malley in announcing his decision went on to say that, "the citizens of Baltimore and Maryland, who are investing in our children's education, should know that new accountability will come with this new investment. What has occurred in our school system is unacceptable. If there is waste; if there is overspending; if there is mismanagement; and if there has been corruption, it will be stopped. It will be corrected. Fiscal discipline will be restored. We must safeguard the progress are children have made."

This decision came after three-weeks of negotiations between the Mayor and Governor over a bailout strategy and package. The Governor had offered to advance the city $42 against next year's school aid and in turn, the school board would relinquish its power to an independent financial authority, a majority of whose members would be appointed by the Governor. Also, the agreement would have enabled the Governor to rip up union contracts with Baltimore teachers on July 1.

In O'Malley's announcement he laid out the basic steps that will be taken as part of a memorandum of understanding between the city and the Baltimore City Public Schools. It will require cooperation, serious examination and changes of existing fiscal practices, an introspective look by the school system at its structure, and some very tough decisions.

The mayor ended his announcement by saying, "we will reform our schools. We will hold adults accountable for public investments. And more importantly, we will educate our children."

This is another example of an urban mayor's involvement and leadership along with a commitment to the success of a city's school system. While this is not the easiest of solutions, it is one that O'Malley feels best serves the interests of the city and its children who attend public schools. He and his staff will now become more fully engaged in the financial decision-making, the system's policies, practices and structure, and work very closely in a new partnership with the Baltimore City Public School's new school administrator.