To: Small City School District Legislators                                        March 6, 2006

 

                  Did you know that over the past eight years small city districts have received state aid increases far below the average increase for all districts? If small city districts had received just average increases over that period they would have gotten $175 million, or 16.5%, more in aid in 2005-06. Each small city district would have had an additional $3 million in aid this year alone. The impact on tax rates and programming of this chronic under-funding is astounding.

 

                  Did you know that the Governor’s Budget for 2006-07 actually worsens these conditions despite its rhetoric about helping high need districts? The Combined Aids Run for the Governor’s 2006-07 Budget shows that small city districts are scheduled to receive increases that are 25% below increases to be received by the average district.

 

Did you know that under the STAR program wealthy districts receive twice as much aid as small city school districts and other low wealth districts? In 1997, the Governor and the Legislature enacted a school tax relief program (STAR) pursuant to Chapter 389 of the laws of 1997.  STAR was intended to relieve the local taxpayer from the growing burden of school taxes and provided for reductions in school tax bills to property owners and reimbursement of the amounts of such reductions to the school districts by the State. The STAR program was, in effect, a way of increasing state aid to education but avoiding the basic operating aid formula which targeted aid to those districts with the greatest student need and lowest property wealth. The STAR program instead targeted state aid to the wealthiest districts: under this program wealthy districts receive twice as much funding per student as poorer districts. The program was phased in over a number of years and now diverts nearly $3 billion in state aid from the operating aid formula. The result of this program is that enormous sums of state revenues each year are distributed to wealthier districts which are on “save-harmless” provisions of the education law, districts that would not be otherwise entitled to any increases under the basic operating aid formula.

 

Did you know that almost all  charter schools are located in or near cities including a number of small cities. The relative size of the charter schools in the small cities is far larger than the size of schools located in New York City or in the other so-called Big Five cities. The result of this is that the cost of charter schools in the small cities has had a significantly greater impact on small city school budgets and local tax rates. School districts experience little or no reduction in operating costs when a child attends a charter school and the cost of charter school tuition becomes an added expense to the district. Moreover, the funding provided to all charter schools comes from the average operating expense of the district, including expenses from kindergarten  (the least) through high school (the most). However, charter schools in small cities are all elementary schools that cost the least to operate.  Charter schools draw, therefore, a highly disproportionate amount from the public school in favor of the charter school.  Nevertheless, no additional state aid has been appropriated to defray the cost of the charter school payments and the school districts making such payments have increased their tax levies to accommodate those costs.

 

Did you know that small city school districts are subject to restrictive debt ceilings which in many cases have prevented or slowed replacement and renovation of aging educational infrastructure. Small city school districts are subject to a constitutional 5% debt ceiling as opposed to the statutory 10% debt ceiling applicable to non-city districts. Moreover, non-city school districts can take advantage of Local Finance Law section 121.20 which allows those districts to exclude any amounts received as state building aid from the computation of debt under the ceiling. This same provision does not apply to small city school districts. Since building aid pays for at least 60% of all capital projects the effective amount of the debt ceiling in non-city districts is three to four times as high in non-city districts as in small city school districts.

 

 

 Did you know that since 1997 small city school districts have been required to submit their school budgets to the voters for approval each year, that they are twice as likely  to experience budget defeats and that they are more vulnerable to the adverse effects of an austerity budget because they have less strength built into their programming. If a budget is not approved by the voters, an austerity budget becomes effective, often requiring the firing of teaching staff, reductions in already weakened programming and elimination of extra curricular activities. Districts working under two or more consecutive budget defeats experience irreparable harm to the quality of their programs and to the education of their students.

               

 

Once again, state education funding is going entirely in the wrong direction, leaving the poorest schools and children behind. Small city children and tax payers desperately need help this year to stop the steady erosion in education resources and upward pressure on already excessive tax rates. Small city school districts need additional funding to enable them to provide the education small city children deserve and small city property tax payers are increasingly unable to sustain.