Federal stimulus nearing passage would further bolster school budgets

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The latest federal stimulus bill hurtling through Congress would represent another massive infusion of money for New York schools – even as the specifics are still shrouded amid state budget uncertainty.

Schools across New York are set to receive about $9 billion combined in direct aid to districts, which comes on top of around $4 billion in direct federal aid to New York schools approved in December, money Gov. Andrew Cuomo proposed allocating to districts next school year. Another $12.5 billion included in the new stimulus bill, which House lawmakers are expected to give final approval to Wednesday, would provide general funding to the state, which could be used to offset proposed cuts in state school aid.

Overall, the stimulus bill backed solely by Democrats promises to bolster school district budgets over multiple years, enabling districts to invest in technology, special interventions for students who struggled during the pandemic, extended learning time, mental health supports and much more.

“I’m really excited that the federal government has acknowledged such a strong commitment to education,” said Jasmine Gripper, executive director of education advocacy group Alliance of Quality Education. “As much as it seems like so much money, schools have a really large task in front of them to figure out how we are going to get kids back in the classroom and back on track to learning, and I don’t think that is going to be cheap or easy.”

The U.S. Senate on a party line vote this weekend approved the overall $1.9 trillion package, tweaking slightly the $123 billion set aside for direct payments to school districts across the state. Democratic House leaders on Tuesday indicated the chamber would be set to pass the bill Wednesday, sending it to President Joe Biden for his signature.

The final district-level allotments are still not known and education policy analysts on Tuesday said there are still open questions about how the new federal aid will factor into the state budget. Cuomo’s proposal included over $2 billion in cuts to state aid that were offset by the federal funding approved in December, raising concerns among district leaders they would face a major funding cliff when federal aid ran out and state aid stood at a reduced baseline. The governor’s proposal also included language that if the state received additional federal aid – as is now likely – it would be possible to restore the proposed state school aid reductions.

Other components of the stimulus bill, like aid to New York City or the state’s Medicaid program, could also impact the overall state budget calculus and where the final education numbers land for next school year.

“We don’t know what the interplay is between general state fiscal relief and the new school money,” said Bob Lowry, who analyzes state policy for the state Council of School Superintendents. “There are pieces we don’t know yet how they will all fit together.”

A summary of New York state district-level funding allocations under the original House version, which was altered slightly by the Senate, though, offers a sense of the scope of funding districts could see from the bill. Schenectady City School District would have received nearly $40 million, under the House-passed proposal. While the Senate version shifted some of the overall money for aid to districts to other education spending, the allotment in the final version is unlikely to change dramatically.

That roughly $40 million in aid to Schenectady would come on top of nearly $20 million in federal support from the December bill. For comparison: at the start of the school year, district officials laid off over 400 teachers and support staff over fears the state would have to reduce district funding 20 percent – or around $28 million. State officials have since said Schenectady will receive all of that money.

It’s still not clear how the new federal aid will factor into the state budget and over how many years the federal money will be provided to districts. The federal legislation enables districts to spend the direct school aid by the end of the 2023-2024 school year, and education advocates have argued its important to spread the money over multiple years.

The federal funding can be used for a broad set of specific expenditures, including staffing, extended learning, technology and improvements to filtration systems, and 20 percent of a district’s allotment must be used to address the expected learning loss students have suffered from during the pandemic. The funding also aims to bolster school budgets after a year of unexpected pandemic costs in transportation, testing, protective equipment and much more.

“The concern isn’t just how are we addressing social distancing and other things moving forward, but also how are we helping districts to get out of the hold dating back to last spring,” said Brian Cechnicki, executive director of the state Association of School Business Officials. “The amount of dollars we are talking about, we certainly think this should be spread out over multiple years.”

Some education groups have proposed increasing from 4 percent to 8 percent the share of a district’s overall budget that can be carried over as unspent general fund from one year to the next. The change would allow districts to more effectively spread out the use of federal dollars, advocates have said. And district leaders setting out on their annual budgets have cautioned they will have to consider multi-year impacts as they develop budget plans for next school year.

Furthermore, many educators are expecting at least some health precautions – like distancing requirements – to remain in place for the start of next school year – another cost to account for.

“The federal dollars in large part are meant to go to overcoming learning loss and bridging the digital divide,” said Dave Albert of the New York State School Boards Association. “Hopefully (the state relief funding) will allow New York state to not replace its state obligation with federal dollars.”

Gripper, whose organization has advocated for new taxes on the state’s richest residents as a source of state school funding, said it’s important that lawmakers scrap Cuomo’s cuts to state aid and lay out a longer-term plan that ensures there will be state funding in place when the federal money ultimately runs out. She also called for clear guidelines, including public engagement requirements and proposals for how districts plan to invest the federal aid, to ensure accountability over how the federal money is actually spent in schools.

“Yes, this federal money gives us breathing room and can provide a good cushion for our schools, but when the federal money runs out, (state lawmakers) still need a plan to support schools,” Gripper said. “There’s no reason why the state should have any excuse to reduce its commitment to schools.”

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