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School Finance
February 06, 2014

FPI report: Students, working families hurt by slow state growth

Author: Darryl McGrath
Source: NYSUT Communications

Holding the annual growth of New York's state government to 2 percent is based on an outdated economic model that has far-reaching and adverse consequences for students, taxpayers and the working poor, according to an analysis of the Executive Budget proposal by the Fiscal Policy Institute, an independent, nonpartisan, nonprofit research and education organization.

And cuts in aid to municipalities have hidden costs for school children because municipalities and school districts so often work in tandem on programs that benefit children and their families, said Fred Floss, the FPI's executive director. Floss spoke Tuesday during the group's annual budget analysis presentation for dozens of lawmakers, public policy experts and unionists. FPI analyst Carolyn Boldiston and economist James Parrott joined him for the presentation.

The state's general purpose aid to local governments has fallen by three-fourths since 1980, and New York City has not received this aid since the state's 2010 fiscal year, according to the analysis. Community centers are now less likely to be open for after-school programs, and parks and recreation departments are less likely to hire high school and college students as summer help. Municipal sports and recreation facilities, enrichment programs such as language help for immigrant families, and cultural programs that make up a well-rounded education also fall by the wayside.

"I think the governor is locked into that 2 percent mindset," said Floss, an economist and former statewide vice president for academics at United University Professions, NYSUT's affiliate that represents academic and professional faculty at the State University of New York. "Two percent was the rate of inflation when he took office, but inflation is higher now.”

The result? In order to hold the growth of state programs and services at 2 percent, New York may be discouraging growth of programs and services that attract an educated workforce. Workers look, not only at what services exist now, but at what will be available for them and their children down the road. People take note of severe cuts in programs and services by cash-strapped municipalities, school districts, and public colleges and universities.

The numbers are also telling for the state's public education. State aid as a percentage of total school spending fell from 40 percent in 2008-2009 to 35 percent or less in each of the last three years, which is its lowest level in 65 years, according to the FPI analysis.

The governor's support for universal pre-kindergarten, a beneficial program NYSUT has long endorsed, is clouded by questions about funding. The $1.5 billion Cuomo has proposed over the next five years is insufficient to provide universal pre-K throughout the state, according to the FPI report.

The outlook for New York's public colleges and universities underscores why NYSUT has launched its Public Higher Education Quality Initiative, which calls for an endowment for the state's public higher education systems to help rebuild their academic programs and services, an increase in state aid and a strengthening of student financial aid programs.

Adjusted for inflation, state support for the State University of New York went down 40 percent, in real terms, from 2008-09 to 2012-13. Both the SUNY and the City University of New York have seen tuition steadily rise, and tuition monies increasingly go toward operating expenses, even as the state's Tuition Assistance Program (TAP) has failed to keep pace with tuition increases.

These changes also come as thousands of state jobs have been eliminated, a pattern that started years ago and has continued. The unemployment and underemployment of state workers makes a college education even less affordable for families who form the backbone of many communities, Parrott said.

"When you lose a government job, you lose a solid middle-class job with economic security and union benefits" he said. "Many parts of New York state, especially the Hudson Valley and upstate, have lost 10 percent of their government jobs in recent years."