Operating Aid for New York City

Appellate Court Order of March 23, 2006

==> The court ordered the State to budget $4.7 to $5.63 billion in additional operating aid for the New York City schools by April 1, 2006, and allowed for a four-year phase-in.

The 2006 Budget Agreement

==> The legislature budgeted operating aid increases of around $400 million for New York City, less than one-tenth of what the courts required.

==> The budget fails to incorporate the fundamental school aid reforms that are necessary to ensure ongoing increases in school aid for New York City.

==> The budget fails to include a fair formula for the distribution of dollars to New York City that is directly aligned to its students' grave needs; instead, it continues to deliver operating aid through its unfair "shares" system.

Operating Aid for Districts Statewide

Creating a Fair Statewide Funding Formula

==> Applying the court order on a statewide basis would result in a statewide increase of $2.6 to $4 billion in annual operating aid.

==> The funding formula needs to be fundamentally reformed to ensure that future school aid is determined based upon actual student need. The current "shares" system needs to be replaced with a simple, fair formula that prioritizes high-need districts.

The 2006 Budget Agreement

==> The budget adds approximately $700 million in operating aid increases for districts outside of New York City but does nothing to prioritize high-need districts.

==> The funds budgeted for high-need school districts are still distributed through the state's pernicious "shares" system that shortchanges high-need districts statewide.

==> The budget does nothing to close the funding gap between school districts with the highest and lowest income levels.

==> The budget fails to provide a statewide solution to the state's unfair and unconstitutional school-funding system and continues to deprive schoolchildren across the state of their right to a "meaningful high school education."

Capital Funding for New York City

Court Order of March 23, 2006

==> The court ordered a $9.179 billion increase in capital funding for New York City.

The 2006 Budget Agreement

==> The budget provides $1.8 billion in state funding for this year's portion of the mayor's five-year capital plan.

==> The agreement allows New York City to borrow $9.4 billion to pay for the remaining portions of the mayor's capital plan and improves the methodology of building aid reimbursements so that New York City will receive a more equitable share of state sources.

==> In total, the capital portion of the agreement makes notable major progress toward securing the court-ordered reforms. It provides an additional $11.2 billion in new capital money for new construction, science labs, and other facilities improvements. Of this amount, it is projected that $6.5 billion will come from state funding sources.

Capital Funding for Districts Statewide

Statewide Capital Needs

==> The primary issues in the CFE lawsuit regarding capital funding relate to relieving severe overcrowding and ensuring up-to-date physical facilities, such as libraries and science labs. In the State of New York, these problems are overwhelmingly concentrated in New York City, but high-need districts across the state continue to have serious capital needs that also require additional funding.

The 2006 Budget Agreement

==> The budget provides $800 million in additional capital funds for districts outside of New York City. Included in this amount is $400 million for high-need districts, which is to be particularly applauded.

* prepared by the Alliance for Quality for Education and the Campaign for Fiscal Equity

March 31, 2006