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Cuomo: Unions, surpluses could offset school aid losses

Cuomo: Unions, surpluses could offset school aid losses

Total aid to school districts would decrease 7.3 percent under Gov. Andrew Cuomo’s proposed budget,

Total aid to school districts would decrease 7.3 percent under Gov. Andrew Cuomo’s proposed budget, which he says could be offset by tapping surpluses and seeking concessions from local unions.

Cuomo made it clear that he wants results, again referring to the fact that the state spends the most in the country on education and has middling results — 34th in the percentage of adults with a high school diploma. The days of just sending checks to school districts are over, he said.

“You actually have to do something for the money,” he said Tuesday in his budget address at The Egg.

Cuomo noted that state aid represents only about 2.9 percent of the total operating expenditures that will be made by school districts statewide. He outlined a series of steps that school districts can take to offset the cuts and avoid layoffs. Local school districts have about $1.2 billion in reserves on hand. Also, districts have a share of $607 million in the federal education jobs bill that was passed last August.

He believes schools could avoid layoffs with a combination of tapping reserve funds and seeking concessions on salaries and health insurance and pension contributions.

Cuomo also suggested that school districts chop from the top, noting that more than 40 percent of the superintendents in 279 districts receive a salary and benefits packaging exceeding $200,000.

“The highest-paid school superintendent makes $386,000. I applied for that job. I failed, so I ran for governor,” he joked.

Another 2,000 senior school administrators make $150,000 or more. “If it’s about students, let’s find savings in the bureaucracy,” he said.

A wage freeze for all teachers and administrators would save $1.1 billion, according to Cuomo.

He also called on small school districts with less than 1,000 students to consolidate.

He added that the state also must fulfill its commitment to high needs districts, which historically have not been adequately funded. He did not elaborate.

Cuomo also proposes two competitive grants of $250 million each for school districts that demonstrate academic excellence and improve efficiency.

Higher education was only briefly mentioned in the address. SUNY colleges will participate in the state’s 10 regional economic development councils. SUNY and CUNY tuition will remain flat under Cuomo’s proposal. State funding of SUNY will decrease from $1.5 billion to $1.37 billion.

Cuomo acknowledged it will be a difficult process ahead with tough choices in the budget: “This is going to inflame the Albany establishment. The lobbyists are going to be running around the hallways like their hair is on fire.”

The proposal was already coming under criticism. The New York State School Boards Association said it would take a “Herculean” effort to absorb the governor’s cuts without affecting students, especially at a time when the state is going to be requiring higher standards.

“It’s going to be very difficult to accomplish that without state and local resources available to schools,” said association spokesman David Albert.

He anticipates that there will be dramatic layoffs and program cuts.

It will not be easy for districts to find savings, Albert said, as they have already shed staff through early retirement incentives. Districts will have to seek concessions from unions, such as employees increasing the share they pay for health insurance, he said.

However, local districts need help from Albany in terms of mandate relief, according to Albert. One idea is for the state to pass a law requiring a minimum employee contribution for health insurance.

Another idea would be repeal of the Triborough Amendment, which keeps the terms of existing contracts in place when they expire until a new one is negotiated.

New York State United Teachers said the proposed budget would be “devastating” for public schools and higher education, especially in conjunction with a tax cap, and the union disagreed with Cuomo’s assessment that layoffs could be avoided.

“I can’t say that we share the executive’s belief that a cut in state aid this significant — coming on top of a $1.9 billion decrease over the previous two years — can be absorbed without teacher layoffs and the loss of other important education professionals,” said NYSUT President Richard C. Iannuzzi in a statement.

Local school leaders did not seem to be too surprised by Cuomo’s proposal. Scotia-Glenville Superintendent Susan Swartz said she felt relieved to finally have some answers to two important questions: how much aid the district is likely to receive and the impact of a property tax cap.

As currently passed by the Senate, the property tax cap would not go into effect until 2012, so school districts have some breathing room.

“I feel like we’re in a better position now to think of where we go from here,” she said.

One place for potential savings is through salaries and benefits. The district has just begun negotiations with its teachers, whose contract expires June 30. Both sides have submitted preliminary proposals.

“Well over 70 percent of school districts’ costs are tied up in employee benefits and salaries,” she said.

She shared the school boards association’s call for mandate relief, particularly in repeal of the Triborough Amendment.

Local school officials also challenged Cuomo’s assertion that school districts could tap large surpluses.

“Amsterdam is not sitting on $10 million of fund balance,” said Greater Amsterdam School Superintendent Thomas Perillo. “Maybe some school districts are. We use portions of our fund balance every year to bring down the tax levy.”

Perillo was unsure of how the aid cuts would affect a high needs district like his, acknowledging that the amounts are a moving target.

He liked Cuomo’s call for wage freezes and higher contributions to health insurance. But all of the districts’ labor contracts are not up until next year, Perillo said, so they may not be able to make any changes immediately.

Like Amsterdam, the Schenectady City School District is not carrying a large surplus, having nearly drained it last year to lower the tax rate.

Schenectady would lose almost $7 million in aid under the governor’s proposal.

“This just adds to the shortage that we’re going to face,” said Interim Superintendent of Schools John Yagielski. “We’re just going to have to live within our means.”

It is too early to speculate on what would have to be cut. Yagielski is not “rolling over” the present budget by plugging in the increased costs but instead building a budget from scratch.

“We’re not going to be able to do everything exactly the way we’ve done it in the past as we move to next year,” he said.

Yagielski shares Cuomo’s goal of eliminating school bureaucracy. He already plans to cut the assistant superintendent positions and give more authority to building principals.

Even though the property tax cap would not be implemented this year, Yagielski said the district has to proceed as if it were and be sensitive to the taxpayers: “They’re kind of exhausted with this property tax business, so I don’t see solving the budget problem by turning to the taxpayer and asking for increases.”

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