When it comes to the state budget, the decision as to what is right and what is necessary is vital. Is it right to depend on billions of dollars worth of federal aid to fund state spending? Or is it necessary?
Federal aid, one of the largest items in the federal budget, is an overriding source of revenue that states and municipalities have depended on since its inception. It can be a great asset in funding and aiding education, health care, public benefit projects, etc. Conversely, it can create large budget gaps if states and municipalities over-project how much aid they are to receive in a given year.
The point being, federal aid and the concept of intergovernmental revenue, which includes state aid, seem to promote overspending and the idea that more is better. How this impacts the quality of education in New York is rather complicated.
According to Gov. Cuomo’s 2012-13 Executive Budget, the state is ranked 38th in the nation in high-school graduation rates but has a per-pupil spending rate that is 73 percent above the national average. Clearly, more isn’t better, but with unemployment still high and some of the highest property tax rates in the nation, residents of New York cannot afford to have more aid cut this year.
Last year, New York suffered from a $10 billion budget gap that state Comptroller Thomas DiNapoli claimed was mostly caused by the loss of federal aid. When such budget gaps occur at the state level, municipalities will certainly get hit the hardest. This is what we are continuing to see for local school districts. They depend on state aid, but it was precipitously cut last year and the fear of continued cuts is paramount.
The argument coming out of Albany is that the federal aid coming in is just not enough. This has proven detrimental, as many school districts are forced to cut teachers, staff, educational programs and raise property tax levies even more in order to balance their budgets.
The problem is, the argument doesn’t hold water. For fiscal year 2007, which is pre-recession, the U.S. Department of Commerce reports that $438.9 billion was distributed in federal aid to state and local governments. For fiscal year 2010, $630.2 billion was distributed. The allocation of such aid is what’s really important, so perhaps less is going toward education? Wrong.
For fiscal year 2007, $20.7 billion was handed out in aid for educational programs. For fiscal year 2010, $34.8 billion was handed out.
Even if we factor in inflation, employee raises and enrollment increases, one would think that $14.1 billion more in federal aid toward education from three years prior would more than make up for such additional expenses.
The New York State 2011-12 adopted budget carried out widespread cuts in school aid across nearly every county. According to the 2011-12 state aid projections provided by the state Division of the Budget, Schenectady County received $9.84 million less in aid last year than in the previous fiscal year. The Schenectady City School District was hit the hardest, losing $4.4 million. For a city that has many deeply impoverished areas and some of the highest property tax rates in New York, it was extremely difficult to make up for that loss.
If state aid to Schenectady is cut yet again, the quality of education will continue to degrade.
Fortunately, Gov. Cuomo’s 2012-13 Executive Budget proposes increasing school aid by $805 million from the previous fiscal year. Whether the Legislature agrees with such increases is still to be determined.
School districts struggle
Schenectady is just an example, though. Many school districts are struggling to meet educational standards set by the state Department of Education, so Cuomo and his team are taking a rational stance on the issue. If the state has one of the highest per-pupil spending rates in the nation, but continues to fall in national educational rankings, then overall spending, along with federal and state aid, might not be the problem. The problem might be the way we go about educating students.
Therefore, as many are already aware, Cuomo has implemented a competitive performance grant program that seeks to improve student achievement while advocating for a fiscally conservative approach toward spending. Details aside, you have to respect the governor for attempting to find an alternative way to increase educational achievement instead of just increasing aid.
And here’s where we come full circle. Overspending, overprojecting and the concept of more is better — these are the results of complete dependency on school aid.
There is no doubt that federal and state aid is necessary, but it more than ever seems to be a necessary evil. School districts have grown to depend on it so much that it creates this myopic belief that the more they receive, the more the students will achieve. When aid is cut, everyone cries wolf. When aid is increased, but educational achievement does not, the cry for more aid is echoed.
Finger-pointing won’t solve the issue, but, rather, comprehensive educational reform and a pragmatic approach toward spending are the only ways to address the problem at hand.
Gov. Cuomo should be applauded for his efforts in shining the light away from just school aid and onto the fundamentals of education.
Robert Caracciolo lives in Schenectady and is a regular contributor to the Sunday Opinion section.