Auditor warns Philly schools budget situation dire

Thursday, January 26, 2012
Phila. schools

Philadelphia's chief auditor says he has serious concerns about the financial state of the city's school system that could affect its ability to borrow money as it faces a severe budget crunch.

City Controller Alan Butkovitz told new schools chief Thomas Knudsen in a letter Wednesday that he would including a warning to bond-rating agencies in his annual independent audit report unless the district offers plans to close a massive projected budget deficit by the end of June.

The Philadelphia School District says it will address Butkovitz's concerns but stressed there's no indication it can't meet its financial obligations.

The School Reform Commission named Knudsen its chief recovery officer last week. The district's budget gap was projected then at $61 million, up from October's projection of about $20 million.

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