By Mike DeNardo

PHILADELPHIA (CBS) – The Philadelphia School District is taking extraordinary measures, to close a widening budget gap this year.

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Even after slashing hundreds of millions in spending this year, SRC chair Pedro Ramos says the district still has to close a $61 million budget gap by the end of May. So Ramos says the district’s 500 non-union employees will have across-the-board salary reductions, forgo a scheduled three percent raise, contribute to their health care payments, and take three furlough days.

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The SRC is also hiring former PGW head Tom Knudsen as a Chief Recovery Officer to run the district for six months.

“I can’t overstate that we think that the circumstances that we’re in in the next five and a half – six months are extraordinary and these are quite exigent circumstances,” Ramos says. “A lot of urgency is required.”

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Knudsen will be paid $150,000, with no benefits. Ramos says there will be more negotiations with unions as the district tries to close its gap. The SRC has never used its power to rewrite union contracts.