The York City School District may face a state takeover because of its dire financial straits.The district was one of just a few "financially distressed" districts statewide that would be immediately affected by a bill that passed out of the Senate Education committee on Tuesday and awaits a full Senate vote.

The bill, which originated in the House, creates a new program for districts under financial duress that involves the state's appointing someone to oversee their finances and draft a plan the district must enact.

York City, facing a $19 million deficit and certain layoffs of teachers and administrators and cutting back sports, would qualify, according to Sen. Jeffrey Piccola, committee chairman.

Chester Upland, Duquesne City and Harrisburg were the other districts that are included.According to Piccola, a Chief Recovery Officer appointed by the state would immediately develop a plan to get the school out of financial duress.

The plan, created in conjunction with district assistance, would be presented to the school board. If the plan is approved, the board is obligated to carry out all of its parts, although it would still be allowed to make regular board decisions as long as they do not intrude on the plan.

If the board rejects the plan, Piccola said, the state likely would use the Court of Common Pleas to get a person put in charge of the district's finances, without needing the board's approval.

Piccola, who called it the "carrot-and-stick approach," said the loss of local control is offset by districts' gaining the ability to get no-interest loans to help get them back on solid ground, as well as the ability to more easily convert a school into a charter school and renegotiate teacher contracts to lower salary increases or benefits.

"The state really does not want this responsibility. We'd much prefer the districts operate on their own. But to avoid the infusion of large sums of money that will never be recovered, we're creating this program," he said.

Opposition: The Pennsylvania State Education Association strongly opposes the bill.

PSEA President Mike Crossey said that without backing the bill with funding - and not allowing districts to borrow money - there's no reason to think the plan will work other than superficially.

"It does nothing to affect the education of children. They've created a crisis by under-funding our schools," Crossey said. "It's part of a shell game"And Crossey said districts can expect to be in court if they try to forcibly make teachers take a wage freeze using state intervention.

"This is an attack on collective bargaining rights," Crossey said "I don't think it's even a veiled agenda."

York City School District business consultant James Duff said the district hasn't been told many details about the plan yet, although officials would be willing to work with the state if it helped.

Borrowing money can help with cash flow but won't fix the budget deficit, Duff said.

Duff believes what York City really needs is restored grant funding, which Gov. Tom Corbett, who backs the "financially distressed" bill, took away in spades in his proposed budget.

York City would lose more than $8 million in charter school tuition reimbursement in next year's proposed budget, as well as grant money for kindergarten, a grade city schools may not offer next year.

"We don't need a Chief Recovery Officer. We need the money," Duff said.

Piccola leans to the contrary.

"That's throwing good money after bad," he said of increased funding for financially distressed schools.

Piccola said York City qualified because it had asked for and received an advance on its state basic education funding in the past year; the district was $8 million in the hole this school year and officials couldn't wait for tax revenue to come in.

A district can get out of the program only after the state Department of Education deems it is no longer financially distressed. And then, perhaps, the district will stop waiting for bailouts, Piccola said.

"This is to cut the dependency on using a crisis to get out of a problem," he said.

- Reach Andrew Shaw at 505-5431 or ashaw@yorkdispatch.com, or on Twitter @ydblogwork