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Statewide Fair Funding Principles

DRAFT

These principles are the result of two years of extensive public meetings and community forums held in New York City and across New York State. They were developed from the common themes on fiscal equity reform contained in position papers issued by the Campaign for Fiscal Equity, the League of Women Voters of New York State, the New York State PTAs, the New York State School Boards Association, and the New York State United Teachers.

These common themes were discussed and refined through intensive discussions at statewide forums co-sponsored by most of these organizations, as well as the Educational Priorities Panel, the New York Urban League, the State Communities Aid Association, the American Jewish Committee of Western New York, the Buffalo Teachers Federation, the Conference of Big Five School Districts, the New York Civil Liberties Union, and Reform Educational Financing Inequities Today (R.E.F.I.T.). The result was a revised version of the Fair Funding Principles, which we then presented to participants in two culminating conferences, one in Albany and one in New York City. The two groups represented a diverse range of stakeholders and expressed their strong support for the ideas contained in these principles.

All New Yorkers have a stake in education reform and securing the opportunity for a sound basic education for every child in the state. We believe that parents, teachers, administrators, school boards, business leaders, community organizations, and other individuals and groups can support these five principles while continuing to adhere to their own specific positions on how they should be applied.

Statewide Fair Funding Principles For a Sound Basic Education

I. The state should guarantee that every school district has sufficient funds to provide all students the opportunity for a sound basic education.

The New York State Constitution guarantees all students the opportunity for a sound basic education. Therefore, it is the state's responsibility to make sure that sufficient funds are available to give all students this opportunity. The State Board of Regents has issued a new set of Learning Standards and requirements for receiving a high school diploma. The state must make sure that all students have the resources they need to meet these standards.
II. The state should determine the actual cost of providing all students the opportunity for a sound basic education.  

Historically, school funding in New York State has been based more on differences in local tax bases and politically-determined state aid "formulas" than on the actual costs of providing a sound basic education. New York State's current foundation funding level of $3,900 per pupil is arbitrary and insufficient, and the state's current formulas do not do enough to compensate for disparities between property-poor and property-rich districts.

Across the country, a growing number of states are setting foundation levels based on the actual costs of providing an adequate education. A cost-based system for New York State should ensure that the basic funding level is sufficient to provide the opportunity for a sound basic education (the "SBE amount"). To make this process as fair and objective as possible, an independent commission should establish the "costing-out" methodology and determine the initial SBE amount. To promote stability, the SBE amount should be established for a five-year period, subject to annual inflationary adjustments.
III. The state should provide at least 50% of total statewide educational expenditures while requiring maintenance of a fair level of local funding efforts.

New York State currently provides approximately 40% of all funds for public education, while local school districts provide nearly 56%. An increase in the state share will promote fiscal equity in two ways:

• The state can raise revenues from a wider range of sources than local school districts.

• The state can compensate for low property wealth in certain districts by equalizing its formulas.

For these reasons, New York State should provide at least half of the total funds for public education in the state. (Of course, not every district would receive 50% of its funds from the state. Districts with low property wealth and low income levels would receive substantially more state aid than wealthy districts.) Increasing the state's share of school funding may permit reductions in local property taxes and other local taxes.
IV. The state should ensure greater fiscal equity among school districts.
  • The state should increase aid to poor districts but should not impose ceilings on expenditures of any other districts.
  • Increased aid should be provided for students who are at risk due to concentrated poverty, disability or limited English language skills, and for population sparsity.
  • Variations in local costs should be taken into account.
  • The current property assessment system should be reformed to ensure uniform standards and regular reassessments.

The State's primary educational responsibility should be to ensure that all students have the opportunity for a sound basic education and the resources they need to meet the new Regents' learning standards. If additional state aid is distributed with these goals in mind, the spending gap between wealthy and poor districts will be narrowed.

Increased aid should especially be focused on providing additional programs and instructional time for students with special needs so that they are prepared to meet the new standards. These reforms, however, should be implemented in a way that:

• does not lower the quality of education in those schools that are currently meeting high standards, and

• accounts for cost differences that exist in various parts of the state.

Fiscal equity reform will also require major changes in New York State's archaic and unfair property tax assessment system.


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