As the School District of Philadelphia prepares to embark on a 10-year, $3 billion facilities master plan, that includes school closures, mergers and campus upgrades, members of Philly’s City Council are calling for an audit of the district’s management and operations.
In a statement from the office of City Council President Kenyatta Johnson (D-2nd dist.), officials say that City Controller Christy Brady has agreed to a request by councilmembers to conduct a performance audit into the city’s school system to “ensure resources are being managed effectively and operations are functioning efficiently.”
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“While the SDP is subject to regular financial statement audits that examine the accuracy of financial reporting and compliance with applicable accounting standards, this request seeks a performance audit focused on evaluating the efficiency, effectiveness, and management of financial and operational practices, including budgeting decisions, resource allocation, internal controls, and long-term fiscal planning,” Johnson said in a statement.
Officials said that councilmembers anticipate the findings will be “a critical tool to inform the City of Philadelphia’s funding for the SDP in the Fiscal Year 2028 Operating Budget, which will go into effect on July 1, 2027.”
According to Johnson’s office, the audit will focus on:
- The current structural budget deficit of the School District of Philadelphia, including the assumptions utilized to project future deficits, enrollment trends, demographic and population shifts, staffing levels, anticipated expenditures, and long-term fiscal sustainability
- The cumulative local funding increases provided by the City of Philadelphia over the past decade, including recurring and non-recurring revenue sources dedicated to public education, and the impact of those investments on the District’s financial condition
- The status of revenue commitments associated with the Philadelphia Parking Authority (PPA), including historical funding expectations, revenues received, and any unreconciled amounts identified through prior audits, legislation, or administrative actions
- The utilization of reserves, vacancy savings, contract expenditures, consultant expenditures, administrative costs, and other expenditures, and their impact on the District’s current financial condition
- An evaluation of the effectiveness and efficiency of administrative and operational expenditures, including central office functions, non-instructional spending, and other costs not directly tied to classroom instruction
- An assessment of whether financial management practices, budgeting methodologies, and long-term financial planning processes align with industry best practices for large urban school districts
- A review of internal controls, procurement practices, contract management, and consultant utilization to identify opportunities for improved accountability, transparency, and cost efficiency;
- The financial implications of proposed school closures, including anticipated savings, transition costs, transportation impacts, facility maintenance obligations, and potential effects on surrounding neighborhoods and public assets.
This audit follows similar reviews of the district, with the city’s public school system previously being found to owe more than 700 former employees $2.8 million in termination payments and having lost nearly $300,000 worth of school supplies — including computers and pianos.
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In Thursday’s announcement, Johnson’s office noted that the district serves over 198,000 students and manages a budget of about $4.6 billion.
And, for fiscal year 2027, Johnson’s office noted, the district will receive about $2 billion from taxpayers throughout Philly.
“Given the SDP’s current budget challenges, requests for additional public revenue, and recent proposals involving school closures and operational reductions, City Council believes a comprehensive performance and management review is warranted to ensure transparency, accountability, and informed public decision-making,” Johnson said in a statement. “The City of Philadelphia has a responsibility to ensure that all available revenues, expenditures, obligations, and funding strategies have been thoroughly reviewed before significant decisions affecting students, families, educators, neighborhoods, and public assets are implemented.”
Also, in a statement, City Controller Brady said that this new audit of the district will ensure that “resources are being managed effectively, operations are functioning efficiently and students are receiving the support they deserve.”
“The School District of Philadelphia is one of our most important public institutions and is entrusted with billions of taxpayer dollars and the education of our children. A comprehensive audit will ensure resources are being managed effectively, operations are functioning efficiently and students are receiving the support they deserve,” said Brady in a statement. “We’ve been encouraged by the SDP Administration’s response to our previous audits and the steps it has taken to implement our recommendations. We expect this audit will continue that collaborative approach and continue to produce positive results for the benefit of students, educators and taxpayers.”
In a response to City Councilmembers’ request for an audit, School District of Philadelphia Superintendent Tony B. Watlington said he looked forward to working with the City Controller’s Office to help strengthen the district’s “financial processes.”
“I am pleased that under the leadership of our Board of Education, the School District of Philadelphia has achieved the highest investment grade rating in history, experienced year over year unmodified (clean) audit opinions with no material weaknesses or significant deficiencies, and achieved the fastest third through eighth grade learning rate improvement between 2022 to 2025 among the largest 25 school districts included in the 2026 Harvard-Stanford Education Scorecard, which included a total of 8,147 school districts across the United States,” said Watlington, in a statement sent to NBC10. “We are committed to working with the Philadelphia City Controller’s Office to continue strengthening our financial processes and procedures.”
Officials did not immediately say when this audit would begin, how long it might take or when taxpayers may see the results of the audit.
