Niagara Gazette

January 31, 2013

Cuomo's budget a boon for Falls schools

by Timothy Chipp
Niagara Gazette

Niagara Gazette — Though it's still in the planning stages, the Niagara Falls City School District's operating budget for 2013-14 is shaping up to look a little different than it has in the past. At least in terms of revenues.

Gov. Andrew Cuomo's executive budget, proposed last week, contained within it a massive change to how school districts receive state aid. Unlike the richer school districts like those on Long Island and, locally, Lew-Port, Williamsville and Lancaster, Niagara Falls is set to receive quite a bit more from Albany next year.

Multiple types of state aid gets distributed by formula, based either on high or low tax levy, spending and student enrollment. Cuomo's changes reduce the percentage distributed to lower needs district and provide extra money to high-needs districts like Niagara Falls.

Falls Administrator for School Business Services Timothy Hyland said the governor's changes are exactly what they've been seeking for a long time as part of a joint lawsuit by small city districts against the state.

"We felt it was not equitable for high tax aid to be given to districts which don't really need it. It represents a step in the right direction," he said.

Hyland said he understands Lew-Port's position, the only Niagara County district hurt by the state's changes. Because of a lack of an industrial footprint in the northwest county district, the burden for funding the school rests almost entirely on taxpayers.

But if you take Lew-Port out of the equation, he said, the majority of the districts being negatively affected by the state's new formulas exist in highly affluent areas of Long Island, where a $100,000 house here is worth closer to $400,000.

"The tax rate there is half of what we have," Hyland said. "But because of the greater evaluations, they're paying more in taxes. We'd much prefer to be in Long Island's situation, because it's actually creating wealth. But we're not."

He said the governor's combined changes will see Niagara Falls realize an additional $2.5 million in state aid, but some of the money isn't an increase in aid, but rather a decrease in a state-wide reduction forced on districts following the housing market crash and bank collapse of 2008.

Then-Gov. David Paterson instituted the Gap Elimination Adjustment (GEA) to help the state stabilize a massive shortfall, which Cuomo's proposal indicates may be improving.

State aid is broken up into several different pots, with the largest being foundation aid. This money is the general dollars given districts for general operation and helps them cover salary expenses. When the housing market collapsed, Paterson took away a portion of each district's foundation aid to cover the shortfall and has yet to be ended.

It created two different numbers and two different formulas, though, which Hyland said favor different types of districts. If Cuomo's proposal had provided more foundation aid, he said, those the rich districts on Long Island – and Lew-Port – would receive more additional funding.

Hyland and the district prefers the governor's actual idea.

"Lew-Port would probably prefer the state put more money into the foundation aid," Hyland said. "But the formula for foundation aid in our opinion is not an equitable distribution of aid. We prefer them addressing the GEA because of this."

Revenues aren't entirely rosy just because state aid is increasing, though. The district is preparing for a third consecutive year without the benefit of casino revenue promised them as part of the hotly-contested compact between the Seneca Nation of Indians and New York state.

In a school district which hasn't increased its tax levy in 19 years, all the non-local tax money it receives plays an important role in keeping education in the Falls as inexpensive as possible.

"We're getting really nervous now," Hyland said. "It's to the point now where it's been three years, we can't recognize that revenue anymore. That's $750,000 we can't include."