Despite loud protests from parents, teachers and students the Philadelphia School Reform Commission, which oversees the Philadelphia School District, unanimously passed a $2.5 billion 2012-13 budget on Thursday evening.
Members of the crowd booed and shouted "shame on you" as the commissioners voted.
The new budget relies on more than $200 million in borrowing and counts on $94 million from the city, but that money is not guaranteed.
"We passed a budget that we still can't pay for. We're going to borrow money for this year's budget," SRC Chairman Pedro Ramos told NBC10.
Officials say it is the first step in a five year plan to make the district fiscally sustainable.
But Jerry Jordan, president of the Philadelphia Federation of Teachers along with many activists say the plan is a bad idea that shortchanges students.
"Schools are going to be under resourced. Schools are going to be missing many of the needed services and programs," said Jordan.