March 31, 2009

Budget's a done deal - updated school aid numbers

Source: NYSUT News Wire

The Assembly and Senate expect to begin passing state budget bills on Tuesday after forging a three-way budget agreement over the weekend. Saying they did "the best we could under a difficult situation," the governor and legislative leaders are working to meet the state's April 1 deadline with a budget plan that basically freezes education foundation aid.

NYSUT leaders thanked members for an unprecedented lobbying effort that resulted in many hard-won restorations, including $40 million in funding for teacher centers. The union is grateful to U.S. Sen. Chuck Schumer and House Chairman Charlie Rangel for their efforts to secure federal stimulus funding and will be reviewing the state budget with an eye on how the stimulus funding is being used.

State aid to education remains flat, but preserves last year's record increases, thanks to federal stimulus monies earmarked to protect education jobs. State school aid will total approximately $21.9 billion in 2009-10, an increase of $405 million or 1.9 percent.

The three-way budget agreement includes restorations to SUNY, CUNY and the community colleges; an increase in the state income tax on the wealthy; supplemental grants to high-need school districts (see list). The budget is also notable for what it doesn't include: there is no Tier 5 and no provision for give-backs from higher ed employees.

Here is a summary of reports from NYSUT legislative staff; details are considered preliminary and subject to change.

Pre-K-12

Districts are restored to current year or present law funding for all expense-based aids (BOCES, transportation, etc.), including Supplemental Excess Cost Aid, High Tax Aid, Supplemental Education Improvement Grants and other education grants funded at last year's level.

Foundation Aid is frozen in each of the next two years, and instead of the agreed-upon four-year phase in of Foundation Aid, the state is now stretching it to a seven-year phase-in. Similarly, charter school tuition payments are frozen at last year's level.

The state intends to use federal stimulus dollars to restore the proposed Pre-school Special Education Cost shift ($132.8 million). Federal money is also slated to restore $40 million for Teacher Centers and $2 million for the Teacher Mentor Intern Program (a $10-million program this year.)

The budget continues $6 million for Teacher Turnover Grants to 853 Schools and Special Act Districts ($2 million of this was a legislative add.) NYSUT lobbying secured a new appropriation of $1.3 million for Special Act School Districts.

The budget agreement provides $30.022 million in fiscal stabilization grants ($26.4 million for New York City, $1.1 million for Buffalo, $1.36 million for Rochester, and additional money also for Troy, Utica, Niagara Falls and Ballston Spa.)

Universal Pre-K is maintained at $376 million.

The budget will continue the Contract for Excellence program for the 2009-10 school year. All districts will be required to submit a contract unless all schools in the district have been identified as being "in good standing".

The budget creates new reporting requirements for New York City regarding its Five-Year Class Size Reduction Plan to include detailed information by school on the number of classrooms and teachers that existed prior to receiving CFE funds and the number of new classrooms and new teachers created with funds; actual average class sizes for each year funding was received; and those that received CFE funds and did not reach class size reduction goals and the actions to be taken in those schools to reduce class sizes.

The budget restores $30 million in funding for non public schools.

Higher Education

In this tough climate, we achieved restorations in higher education. For SUNY and CUNY community colleges, the Legislature fully restored the proposed 10 percent cut in state base aid (an average cut of $270 per full-time equivalent student.)

SUNY's net operating budget is increased by $40 million, of which $32.9 million is recurring. In an agreement that UUP and NYSUT fought hard for, the budget provides for a $75 million SUNY supplemental operating account to preserve student access and protect faculty and other campus positions. The Legislature restored 17.4 million in cuts to SUNY's university-wide programs. The Legislature agreed to allow SUNY to keep 20 percent of an approved $620 tuition increase, and provides for SUNY's share to grow in the coming years (up to 50 percent in 2012-13).

While the Legislature went along with the $25 million cut to the SUNY hospital state subsidy, the state will use this money to leverage an increase in federal monies for disproportionate share payments to theses hospitals in the approximate amount of $48 million which is available for expenditure over two fiscal years. More specific information will follow. The Legislature rejects the governor's 0.7 percent gross receipts tax on hospital revenues and sets such tax at 0,35 percent.

Responding to union concerns, the Legislature rejects the proposal to merge New York State Theatre Institute with the Egg.

The Legislature provided an additional $20 million in operating aid to CUNY's senior colleges. CUNY's net operating budget is increased by almost $51 million for 2009-10. The Legislature agreed to allow CUNY to keep 20 percent of an approved $620 tuition increase, and provides for CUNY's share to grow in the coming years (up to 50 percent in 2012-13).

The Legislature rejected proposals for a Tier V retirement plan for new hires and for SUNY/CUNY flexibility. There is no provision to seek elimination of negotiated pay increases for state employees; state employee pay lag; cut to Retiree Medicare Part B Premium Reimbursement to state retirees; or cut to state employee retiree health insurance based on years of service. More details are available on the leader site.

Personal Income Tax / STAR

The budget includes a three-year temporary income tax increase on high earners that will raise $4 billion in 2009-10. The income tax rate for married taxpayers filing jointly with incomes above $300,000 would increase to 7.85 percent; for those earning $500,000 the rate would go up to 8.97 percent.

The traditional STAR program is continued. However, the STAR rebate check program will be eliminated, saving $1.54 billion.