State Aid to School Districts Likely to Increase with Little ElseDecember 13th, 2011
By Brian Backstrom
The state Board of Regents today will vote on a committee-approved proposal for state aid to school districts for the 2012-13 school year. The Regents proposal, developed over several months by the state Education Department, is merely a recommendation for the governor and state legislature to consider. It otherwise has no effect.
While the Regents proposal is worth a read and has much to commend, its details are likely to be a dead letter that will gather dust after today. That’s unfortunate.
The Regents proposal recommends a $755 million increase in overall school aid, to more than an amazing $20 billion in total for next school year. An increase of this magnitude was once serious money, even as recently as the go-go nineties. Now it’s merely a shade less than 4 percent more than the current year’s state aid.
“High-need” v. “Low-need” School Districts
The Regents proposal calls for further shifting educational funding from so-called “low-need” (suburban) school districts to “high-need” (urban) districts. That is, most of the recommended $755 million increase would go to the latter districts. Suburban communities typically have much more property wealth, meaning they have a substantially larger property tax base from which to raise locally-funded revenue for education, and these communities in turn tend to spend much more per pupil than high-need areas of the state. Contrary to the ongoing claims from the union-backed Alliance for Quality Education that urban school districts are being “shortchanged” under the current funding system, state aid formulas already heavily favor high-need districts, which receive an average of 4.5 times more aid per pupil than low-need districts, a fact honorably shown by the Board of Regents in its proposal.
In the legislature, where the actual school aid increases will be determined, attention will also be paid to politically influential suburban areas, communities populated by mostly middle class residents who pay very high property taxes and get a relative pittance in state aid. Their state legislators are a sure bet to resist a further shifting of state school aid “shares” among the state’s school districts.
Reforming Building Aid
While political factors on both sides will affect the debate over state aid distribution, many of the details of the Regents aid proposal are worthy of serious consideration by the state legislature. Most important are “expense based aids,” primarily building aid, which the Board of Regents is proposing to change from a spend-to-get entitlement to a more restrictive formula to reduce the long-standing incentive to build more than is prudent or affordable.
From the 2005-06 school year to 2010-11, state expenditures for building aid increased 10 percent annually. A greater share of state aid being skewed toward bricks and mortar means less for general education needs, including staff and supplies. Another cost-shift is skyrocketing pension costs, the elephant-in-the-room that the Regents continually avoid but which belongs front-and-center in any education financing discussion. It is another issue that may come up in the budget negotiations between Gov. Cuomo and the legislature.
The Regents’ proposed changes for building aid would not take effect until after the next school year to allow for current-year expenses to be reimbursed in the subsequent year. That necessitates the governor and legislature to enact changes now to take effect by state fiscal year 2013-14 and following for any savings to be achieved.
School aid formula changes are often slow to be realized, so it behooves the Regents and Education Department to prioritize from their comprehensive proposal on what really needs to occur now.
Brian Backstrom is President of the Foundation for Education Reform & Accountability and may be followed on Twitter at @nyedreform.