School districts received full state aid payments at the end of September, and a state budget official on Wednesday said the state planned to fully fund October payments too as New York continues to press for new federal stimulus money.
But earlier reduced payments to districts have not been restored and the financial outlook for school districts over the coming months remains highly uncertain.
Bob Lowry, who analyzes state government for the State Council of School Superintendents, predicted state officials would likely continue to fully fund payments through October, and wait to see if the November elections improve chances for further federal aid before they decide on future school aid payments.
He also said it’s not likely districts will get any clearer sense in October on whether state aid reductions will return. He said school district officials should be looking at how to cut budget costs if necessary.
“This uncertainty is extremely difficult for school district leaders to deal with,” Lowry said. “At a minimum, I do think it makes sense for districts to be contemplating what kind of actions may be necessary.”
Freeman Klopott, a state Division of Budget spokesperson, in a Wednesday statement highlighted the state’s long-running effort to get federal relief to help mitigate against the state’s massive revenue losses during the pandemic, noting Washington may refocus on supporting state and local governments after the election fever breaks. He also reiterated Gov. Andrew Cuomo administration’s assertion that without new federal aid, the state will not be able to fully fund its commitments to school districts this year.
“While we await the promised federal aid, we will continue to use the tools enacted by the Legislature to keep the budget balanced,” Klopott said. “School aid reductions are a last resort, though without federal aid, the state cannot fully fund school aid for the entire school year. Perhaps after the election season is over, Washington will turn to the critical services funded by state and local governments such as school aid.”
Business officials in multiple Capital Region districts on Wednesday confirmed that school aid payments due in September were fully funded – though some said they were still short of funding from earlier payments that had been reduced, including shortfalls stemming from reduced reimbursement payments for school district expenses incurred last school year.
State budget officials had promised the late-September payments would be fully funded amid a growing furor over payments to districts that included a 20-percent withholding of expected aid.
Concerns over the budget shortfalls that would mount if reduced aid payments continued spurred district officials in Schenectady and Albany to institute hundreds of layoffs. The budget cuts started in districts most reliant on state aid to cover their costs, also the state’s highest-need districts. Other school districts have started to brace for the potential budget fallout if aid reductions resume through the remainder of the school year. (Thursday marks the first day of the second fiscal quarter of the school year.
But school district budget officials on Wednesday largely said they did not know what to expect from state aid payments in October or the coming months.
“Honestly we do not know what to expect going forward,” Chris Abdoo, assistant superintendent for support services at Burnt Hills-Ballston Lake Central School District, said by email. “We are hoping for the best but preparing for the worst.”
Abdoo highlighted a community budget committee the district established last week to review the potential impacts of cuts, noting the district has not seen any of the $500,000 that has been withheld from other state aid payments the district has received this year.
Tim Hilker, assistant superintendent for business in Saratoga Springs, added an important caveat after saying he did not have any indication that the district would receive less than full payments in October. “We have no indication that it will be anything less than 100 percent at this time. That is always subject to change.”