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Winter 2000 (v4#1)

Ambitious Plans to Reform State Funding of Schools Emerge in Albany

In the wake of the Campaign for Fiscal Equity (CFE) lawsuit’s charge that the state’s unfair funding system does not provide "a sound, basic education" to public school students in New York City, large-scale plans to overhaul the entire system are circulating around the offices of state legislators and their staff members. One has been fashioned by the NYS Board of Regents and the other by the Midstate School Finance Consortium.

There are few indications, so far, that there will be a serious push for large-scale reforms during this legislative session by the Governor or legislative leaders, but the emergence of these plans is a significant political development. In 1974, the legislature adopted an "interim" school finance system in expectation that the courts would rule favorably on an earlier school funding lawsuit, called Levittown. When the NYS Court of Appeals issued a ruling in Levittown in 1982, stating that the state constitution did not require fair funding, no effort was made by the legislature to improve the system. Instead, the "interim" school funding system became even more complex, and all attempts to develop a new system were dismissed as politically "unrealistic."

Ideas for creating a better funding system for educating children are now being taken seriously. If and when the state courts rule favorably on the CFE lawsuit (see page 12) and the appeals process is concluded, the legislature will be called upon to fashion a remedy. These large-scale plans already contain many of the building blocks for a new education funding system, and their differences point to some of the major debates that may arise when the legislature gets closer to negotiating a remedy that will satisfy different types of school districts and regional constituencies.

The Similarities
The Regents and Midstate Finance Consortium plans reflect a consensus that has emerged from four state commissions charged with developing recommendations for a new education funding system. Most, if not all, of the commission reports (Fleischman, Rubin, Salerno, and Swygert) outlined reforms that would:

Simplify state aid formulas and eliminate counterproductive funding policies (such as limits on increases to high-needs school districts, which EPP documented in our recently released report, Checkerboard Schooling, see page 3).

Continue to provide more state aid to lower-wealth school districts and far less aid to affluent school districts (often called "wealth adjustment").

Provide a greater proportion of state aid to all school districts so that schools would not have to depend so heavily on local resources, which vary tremendously in our state compared to other states, such as Iowa. In the 1990’s, the state’s share of all public school expenditures fell below 40%. Commissions as well as diverse organizations such as the NYS School Boards Association and the NYS United Teachers, recommend that the state’s share should go above the 50% mark.

Include a meaningful measurement of differences in students’ needs among school districts that would recognize the extra costs required to educate a large number of students disadvantaged by poverty or having to learn English. (Similar to a "wealth adjustment," this "student needs adjustment" would mean that districts serving high-poverty and/or immigrant students would get more state aid than districts serving mostly affluent, English-speaking students. Because of population scarcity, rural schools are also more expensive to operate because of their small size.)

Recognize that school districts in New York State face very different local costs in hiring staff and buying materials, so that state aid dollars purchase more in upstate area and purchase less in the downstate area. (This is called a "regional cost factor" or "regional cost index.")

Require that local school districts maintain their funding level for schools, so that an increase in state funds is not nullified by a decrease in local funds. (This is called "maintenance of effort.")

Increase resources for the lowest-wealth school districts, rather than trying to lower resources for the most affluent school districts. (This is called "leveling-up.")

Another similarity of both plans is that they focus on changes in Operating Aid that provide school districts with funding for administration and instructional programs. No major reforms are presented to eliminate inequities and counterproductive policies in: Building Aid (which helps local school districts pay for new construction and major repairs); Transportation Aid (which helps school districts pay for school buses); and special education services for children with the most severe disabilities.

Now You See It, Now You Don't: Children Lose In Three-Card Monte Game Of State Aid
Class Size Reduction Has Finally Come to NYC!
Gov's "School 2000" Falls Far Short
Ambitious Plans To Reform State Funding Of Schools Emerge In Albany
The Pluses and Minuses In The Different Plans
Fight For Fair School Funding Moves To Court
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