School crisis seen as solvable

The Seattle School District's considerable financial problems can be solved.

That's the upbeat assessment of an advisory committee to Superintendent Raj Manhas. The committee is due to release preliminary recommendations to Manhas on Dec. 6.

Former Boeing executive John Warner, who's heading a financial subcommittee, said Thursday there is no silver bullet in balancing the budget, but rather it will be achieved through incremental gains in a number of areas. He emphasized that the state and city will need to work closely with the district to make it happen.

The advisory committee this week outlined the alternative in stark terms: a $41 million deficit by the 2008-2009 school year if the district doesn't change the way it does business. The committee's analysis essentially updates and extends by another year previous district estimates that show the deficit hitting $14 million next year and $21 million the year after.

District Finance Director Steve Nielsen said the $41 million is a cumulative figure that can never occur in reality because of a state law that requires the district to balance its budget each year. But the figure does illustrate how deep the district may need to cut services, he added.

"It shows the net effect of each year, if we have to whack and whack," Nielsen said.

Nielsen said he provided the committee with detailed financial information that was used to compile the figures. While the committee analysis differs slightly from the way the district would calculate the figures, it is "in the same ballpark," he said.

Warner said part of shoring up the budget involves appealing to the state for more money and to the city for financial partnerships — but not handouts. The school district also can do a much better job of managing its large portfolio of commercial and residential property, he said. Some of the land is sitting idle.

"There's a whole lot of property opportunities," he said. "But we are not advocating selling."

The district should instead emulate the University of Washington, which generates significant revenue by carefully managing prime downtown real estate it owns, he said.

Warner said the committee also may recommend reducing transportation costs by getting more high-school students to take Metro buses.

"I am confident, frankly, that this can be resolved," he said of the budget gap. "It will take everybody working together on it."

Warner said the committee has not completed the budget suggestions for Manhas but is working on that now.

Nick Perry: 206-515-5639 or nperry@seattletimes.com