Tax Watch

A new report from the Statewide School Finance Consortium claims the school-funding formula New York set up to resolve a longstanding lawsuit over education equity has been “inequitable, unfair, unreliable and fiscally unsustainable from its inception.” The organization said the inequities in the distribution of Foundation Aid—the largest state grant to school districts—and steep cuts in state aid in recent years “were an intentional, politically motivated redirection of money to wealthier school districts at the expense of the less wealthy.”

New York began using the new Foundation Aid formula in the 2007-08 fiscal year. Due to the state’s fiscal crisis, it has not been able to meet the funding obligations that were envisioned—$5.5 billion over four years. The state met its commitment for the first two years, but school aid was cut in the past two years. The budget for the 2012-13 fiscal year, which runs April 1 through March 31, increased aid by 4 percent.

If the Foundation Aid formula is not changed, “a significant number of school districts will not have the cash reserves to sustain themselves over the next two years as they face state-created mandates, contractual obligations, and health insurance and pension costs,” according to the East-Syracuse-based Statewide School Finance Consortium, which represents more than 400 public school systems in New York.

Per-student aid losses in Westchester, Rockland, Putnam and Nassau counties and New York City were below the state average of $794, the report found. The losses were $456 in Westchester, $653 in Rockland and $664 in Putnam. Largely rural or suburban upstate areas and four of the Big Five city school districts, including Yonkers, received the highest per-student cuts in the past few years, the study said.

With the new property-tax cap, low-wealth districts with high poverty rates will not succeed educationally or fiscally, the report said. The coalition also criticized the so-called “bullet aid” system, in which lawmakers in the majority party control funds that are doled out to poor and wealthy districts. The report said bullet aid “is a wrong-minded process that is an extension of political authority at its most cynical.”

Rick Timbs, executive director of the coalition, said public education in the state is becoming a “have and have not” reality. “As schools and communities with higher levels of poverty and low fiscal capacity continue to get less help from our leaders in Albany, the opportunities for their children also diminish,” he said in a statement.