TESTIMONY of The NYS Association of Small City School Districts

Joint Legislative Hearing on 2008-09 Executive Budget
(Elementary and Secondary Education)

February 4, 2008

Presented by: Norma Barton, President, NYSASCSD
and Member and former President, BOE, Canandaigua CSD
 

     On behalf of the New York State Association of Small City School Districts and the quarter of a million children and
1.5 million residents we serve, we welcome this opportunity to comment on the 2008-09 Executive Budget.  

TARGETING OF STATE AID   

    Last year, through enactment of historic education reforms, the Legislature began the work of addressing the many funding
 inadequacies plaguing small city school districts and the more than 200 similarly situated high poverty, low wealth districts. The 2007-08 State Budget enacted a remarkable set of school funding and accountability reforms that largely erased road blocksto adequate funding which had been imposed for decades by regional and class politics. These reforms have already begun eliminating some of the root causes for the chronic failures that many of our schools experience.

    For decades, political considerations, not educational needs, drove the distribution of education aid. For example, from 1996 to 2006, small city school districts, poorer than the state average by 20%, received lower than average increases in education aid (See Exhibit A). The shortfalls in aid wreaked havoc on small city district programming and tax rates. Cumulatively, this shortfall caused the loss of many hundreds of millions of dollars in State Aid and taxes in these districts soared in comparison to wealthier districts.

     The resulting disparity in school tax rates can be clearly demonstrated: in some wealthy districts tax rates are $5/$1000 of
assessed value while in many small city districts rates are as high as $26/$1000. This gross disparity is a direct result of the decades long failure of traditional school aid formulas. This disparity effectively crippled the capacity of the poorer communities to meet the needs of their school children.

    Like the Governor’s Budget in 2007-08, this year’s Executive Budget has been thoughtfully crafted to recognize the disparities between wealthy and poor districts, to target aid to those students and districts with the greatest need and to achieve educational excellence for all by beginning to correct those disparities.  

    However, we are deeply concerned that, through Budget negotiations, the targeting of State Aid to those neediest districts will be blunted, just as it was last year with the addition of High Tax Aid and other compromises such as the Adjusted State Sharing Ratio. Last year under the Executive Budget, small city school districts and similar districts were targeted to receive a State Aid increase 3% above the state average increase. When the State Budget was finally approved, the margin between these poorer and wealthier districts was reduced by 33%, from 3% to 2%. The enactment of High Tax Aid and Sharing Ratio options were largely responsible for this diminution in targeting.

   This year under the Executive Budget, due to the $4 billion State deficit, the margin between poorer and wealthier districts is less than was proposed in 2007-08. We are worried that the progress made in 2007-08 will largely evaporate once political pressure is applied and that poorer districts will once again fall behind their suburban neighbors. We urge the Legislature to insure that any amendments to the Executive Budget are scrutinized so that targeting of aid necessary to keep faith with the commitment to provide additional funding for those students who are not now adequately supported is not jeopardized. The Legislature must keep its eye on the task at hand; targeting State Aid to insure that a quality education for all students is provided, regardless of where they live or how well-off their families are.

FOUNDATION AID SAVE HARMLESS

The proposed 2% save harmless increase in Foundation Aid is far too low for most our districts. On the basis of a recent survey, our districts are experiencing between 5 and 8% increases in the basic cost of doing business, without making any staffing or programmatic improvements. A 2% base increase in State Aid would erode the extra funds intended for new programs or drive double digit tax rate increases, particularly in those districts most heavily dependent on State Aid, i.e. poor districts. The minimum increase in State Aid should be based upon graduated scale depending upon wealth up to a ceiling of 6%. (See Exhibit B for suggested bill language.) Several high need small city districts are in special need of relief from the save harmless, including Ogdensburg, Auburn, Mt. Vernon, Peekskill and Hudson. Several of these are hurt by the Foundation Aid formula where enrollments are declining. (See Exhibit C.)

CONTRACT FOR EXCELLENCE

    The Executive Budget has also continued to address the critical issue of accountability, i.e. how can we be assured that the State’s significant investment in children will be used most effectively and will result in meaningful progress toward explicit educational goals. The experience this past year of the 19 small city Contract for Excellence (C4E) districts was difficult but nonetheless instructive. Our C4E districts are committed to making the accountability system work but they discovered that greater flexibility than they currently have in the use of funding is necessary. They also discovered that they need help in planning and in setting realistic and achievable goals.  We have developed several recommendations which are necessary to insure that the C4E reforms do not gut existing effective programs. (These recommendations are contained in Exhibit D.)

CHARTER SCHOOLS

    We are also deeply concerned about the effect that Charter Schools have had on Albany CSD, and to a lesser extent, on Schenectady, Troy and Lackawanna CSDs. The Transition Aid enacted last year is woefully inadequate and makes an assumption which is not true, i.e. that the stranded costs of serving students attending Charters will phase out. We believe that districts losing students to charter schools will experience increases in costs equal to 2/3 of the AOE per child on an indefinite basis. These increases in costs are a direct tax on the local property taxpayer, who in small city districts is already overburdened. (See Exhibit E which contains suggested bill language.)

CONSTITUTIONAL DEBT CEILING:

    Non-city districts have debt ceilings which are 4 times as great as in small city school districts. We ask that debt ceiling reform for Small City School Districts be enacted by approving legislation authorizing a Referendum to repeal the ceiling, by excluding amounts received in Building Aid from computation under the debt ceiling as is currently applicable to non-city districts or by providing that debt incurred by small city districts through the New York State Dormitory Authority be excludable from debt ceiling computations.

CONCLUSION

    The Governor and Legislature are to be greatly commended for their staunch support of the students we serve. We also commend both Houses of the Legislature for their long standing commitment to improving our educational system. As we noted last year, we all have a once in a generation opportunity to move education in New York into a new era, where all children will have the support necessary to fulfill their potential. Our state has the unique chance of becoming a lighthouse for the nation, a lighthouse showing the way to provide excellence in education for all. We look forward to working with the Legislature in any way we can to make this remarkable opportunity a reality.

 

                                                            EXHIBIT A

 2006-07cumulative analysis of state aid

Small City School District Computerized Aid Analysis
Fiscal Year 1996-1997 Through Fiscal Year 2006-2007
10 Year Average Actual Total Aid Increases
	1996-1997	2006-2007	% increase		10yr avg % increase
SCSD Total	$                          982,654,238	$    1,601,102,664	62.94%		6.29%
NYC total	$                       3,383,492,023	$    6,477,901,841	91.46%		9.15%
State total	$                       9,692,966,884	$ 16,890,735,224	74.26%		7.43%
State-(NYC+SCSD)	$                       5,326,820,623	$    8,811,730,719	65.42%		6.54%
State-NYC	$                       6,309,474,861	$ 10,412,833,383	65.03%		6.50%
State-SCSD	$                       8,710,312,646	$ 15,289,632,560	75.53%		7.55%