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Chester Upland School District Mired In Massive Budget Crisis

By Ben Simmoneau

CHESTER, Pa. (CBS) -- The Chester Upland School District could be just weeks away from shutting down as it copes with a massive cash crisis. District officials say there is not enough money to make payroll next Wednesday, January 18.

"That payroll is approximately a million dollars," said acting superintendent Dr. Thom Persing. When asked how much money the district has, he says it's "zero."

The shutdown of a public school system would be unprecedented in Pennsylvania, according to a state spokesman.

"We're down to the hour of crunch. We're there. This is no kidding. This is it. This is the real McCoy," Persing said.

Chester Upland came out from under 16 years of state control in the summer of 2010, but Persing says it did not gain true budgetary control until a year later, in the summer of 2011. And like all districts across Pennsylvania, it saw its state subsidy cut last year. This district lost $8 million, and Persing says it also lost at least $4 million in additional funding it had while under state control.

Persing says the state did not leave the district in strong financial shape, requiring what he says were "draconian" cuts, many of which the district made. Twenty-eight percent of the staff was laid off. But Persing, who has only been on the job since October, does not fault the state entirely.

"To say it's the state's fault, I think, would be unfair," he said. "There's enough blame to go around."

For now, teachers and staff have agreed to work without pay for as long as possible, which Persing estimates will be about two weeks at most. He says the district won't be able to continue much beyond February 1 without additional state help and wants the Pennsylvania Department of Education to advance it money, perhaps as much as $18 million.

"I think it's a disgrace," said parent Margaret Lee. "I think if we as parents can maintain our budget with the type of income we make, so should the school district."

"The Department [of Education] is still in ongoing discussions regarding working with the district to come to a resolution so educational programs are not disrupted," said Tim Eller, a department spokesman. He says the state is opposed to advancing funds because it "will only put us back in the same position in a few months."

Eller says as soon as state control ended, the local school board mismanaged the district once again. He says it has spent "beyond its means" and needs a realignment of its "structural fiscal and operational management."

It's not clear what will happen to the students should the district shut down. Eller says that would be "unprecedented" in Pennsylvania.

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