A summary report of findings from our partnership with the School District of Philadelphia. Presented to the media May 2015.

1. © Education Resource Strategies, Inc., 2014
SDP Expenditure Trends
May 2015

2. Executive Summary
1. After passthroughs and non-operating expenses, SDP spent $1.75B, or $12,724 per pupil,
educating PreK-12 students in FY14
2. SDP’s per-pupil spending has declined more quickly than the decline in enrollment
3. SDP expenditures are 19% below ERS peer district median and 17% lower than its
expenditures in FY11, after adjusting for inflation
4. SDP’s staff benefits costs are high and rising.
 Benefits represent 36% of teacher compensation costs, 1/5th of which is reimbursed by PA
 SDP’s share of benefits costs is up 32%, or nearly $8,000 per teacher, since FY11
5. In the face of reduced revenues, growing benefits cost has led to radical cuts in virtually
all functions, including critical supports for teachers and school leader
 School leader roles are more complex with fewer resources and less central office support
1
NOTE: As the information utilized in this analysis includes Pre-K expenditures and crosses multiple funds, – operating,
categorical, and enterprise – it should not be used in a comparative analysis with charter school per pupil rate.

3. Our starting point: SDP spent $1.75B in 2013-14 to
educate its students
2
$2,964
$1,749
$1,147
$748
$142 $271
$37 $16 $602
$2,074
$ millions
Amounts for accounting purposes, such as transfers and payroll clearance, are excluded from this chart.
* Includes passthroughs to private, parochial and other “non-public” schools as well as Special Ed passthroughs
** Includes claims and settlements, adult ed, carryovers and other line items totaling less than $1M
Source: SDP FY14 Expenditures, ERS analysis; ERS benchmark database
Passthroughs
$890M
SDP non-operating expense
$324M

4. SDP’s PreK-12 operating budget has declined faster
than enrollment, leading to a drop in per-pupil funding
3
$2,241
$2,428
$1,749
Optg Budget (in mil)
PreK-12 Operating
Budget ($ millions)
167,460
157,991
137,475
Enrollment
PreK-12 Enrollment
FY 0708 FY 1011 FY 1314
$13,384
$15,369
$12,724
$pp
Dollars per pupil
Source: SDP FY11 and FY14 Expenditures, ERS analysis; ERS benchmark database
Since 08 -22% -18% -5%
Since 11 -28% -13% -17%

5. $7,886 $8,488
$11,036
$12,724
$15,624 $15,875
$17,031
$20,824
Aldine Charlotte Prince George's Philadelphia
FY14
Baltimore Cleveland DC Newark
Cross District Comparison of Average PreK-12 Operating
Geographically Adjusted $pp (fully allocated)*
SDP is currently funded below the median of its ERS peer
districts on a dollars-per-pupil basis
4
Comp District Median = $15,624 pp
* Dollars represent PreK-12 operating budget/expenditure for year studied. Dollars adjusted for geography using the National Center for Education Statistics 2005 School District Comparative Wage Index.
Dollars adjusted to 2013-14 (inflation adjusted) using the Bureau of Labor Statistics CPI calculator
Source: SDP FY14 Expenditures, ERS analysis; ERS benchmark database
Unadj $pp $7,781 $8,201 $12,494 $12,724 $14,073 $14,371 $18,889 $21,136
CWI 1.35 1.31 1.55 1.33 1.32 1.23 1.56 1.47
Analysis Yr 12-13 13-14 12-13 13-14 09-10 12-13 11-12 10-11

6. $71,516 $71,622
$14,096 $17,728
$9,439
$11,420
$3,857
$7,830
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
FY 11 FY 14
Average teacher compensation, FY11 to FY14
A - Retirement-State
B - Retirement-Local
C - Other Benefits*
D - Health
E - Salary
Increase in teacher compensation is driven by benefits
costs, with SDP’s per-teacher share up 32% since FY11
5
Change FY11-FY14
$/teacher Pct
$ 5,066 +183%
2,371 +160%
1,981 +21%
3,631 +26%
106 +0.1%
Total comp increase $ 13,158 +13%
Benefits increase (A,B,C,D) $ 13,052 +47%
SDP comp increase (B,C,D,E)
SDP benefits increase (B,C,D)
$ 8,090
$ 7,984
+9%
+32%
$112,687
$99,300
*Other benefits includes 70% state contribution to FICA for teachers on operating budget, or ~$3,000 per teacher or ~$25M. The cost of this benefit is unchanged from FY11 to FY14.
Source: SDP FY11 and FY14 Expenditures, ERS analysis; ERS benchmark database

7. Since FY08, SDP has reduced costs in virtually all
functions to pay teachers’ salary and benefits
6
Use
FY08
$M
FY 11
$M
Pct chg
FY08-FY11
FY14
$M
Pct chg
FY11-FY14
Pct chg
FY08-FY14
Instruction $1,157 $1,383 +19% $1,065 -23% -8%
Teacher compensation* 987 1,137 +15% 951 -16% -4%
Aides compensation 54 80 +47% 79 -1% +46%
Other Instructional functions** 115 166 +44% 35 -79% -70%
Operations & Maintenance 542 524 -3% 405 -23% -25%
Pupil Services & Enrichment 179 187 -4% 113 -40% -37%
Leadership 142 176 +23% 86 -51% -40%
Business Services 67 69 -3% 48 -29% -27%
Inst Support & PD 101 90 -11% 32 -64% -68%
Total Operating $M 2,190 2,428 +11% 1,749 -28% -20%
Enrollment (000s) 163 152 -3% 135 -13% -16%
Total PreK-12 Expenditures
Increase
0-25% decrease
25+% decrease
*SDP is reimbursed for ~70% of FICA and Retirement expenses on operating budget, approximately $95M in FY14.
**Includes subs, librarians, materials, extended time
Note: FY 0708 Operating Budget excludes PreK expenses
Source: SDP FY11 and FY14 Expenditures, ERS analysis; ERS benchmark database

8. - 47%
- 80%
- 37%
- 45%
- 68%
School Supervision
School Administration
Curriculum Development
Human Resources
Professional Development
Percent decline in preK-12 operating expense, FY11-FY14
– select Uses/Functions
As the job of an instructional leader has become more
complex, SDP has reduced critical supports
7Source: SDP FY11 and FY14 Expenditures, ERS analysis
Instructional
Support &
Prof Dev
Leadership
New evaluation
expectations
More rigorous
standards & testing

9. Principals and teachers are experiencing less direct
support both within schools and from the district office
8
1.8
1.0 1.1
2.2
0.8
0.9
0.1
0.8
1.0
0.3
School-based FTE per principal
FY11 per principal FY14 per principal
Source: SDP FY11 and FY14 Expenditures, ERS analysis
28.327.8
26.3
23.4
19.119.018.4
17.0
13.012.1 11.6
10.2
Principals per area superintendent
Key in-school positions have been
reduced by 20-90% since FY11
With high case loads, area superintendents
largely focus on compliance
Median = 18.4
principals per area
superintendent