FOR IMMEDIATE RELEASE, DECEMBER 11, 2003

For More Information, Contact:
Tom Dunn or Jonathan Burman, at (518) 474-1201
Internet: http://www.nysed.gov

BOARD OF REGENTS PROPOSES MAJOR REFORM
IN STATE FUNDING FOR THE SCHOOLS

The State Board of Regents today proposed a major reform of State aid to the schools that they said should result in a fair and equitable level of spending for each district.

“This is a new approach to funding the schools that will help meet a fundamental goal the Regents have worked toward this past decade: to provide greater equity for children and close the achievement gap,” Regents Chancellor Robert M. Bennett said. “This approach is designed to get beyond the status quo and provide enough funding where it’s needed.”

“If New York enacts this proposal, our neediest students will get the resources they need to succeed in this increasingly complex society and economy,” State Education Commissioner Richard Mills said.

Foundation Formula

The new approach, called a “foundation formula,” calculates the cost of educating each student to the State’s learning standards.

Under this proposal, the State Aid foundation formula is much simpler than the current State Aid formula:

District’s State Aid = [Foundation Cost X Pupil Need X Regional Cost Index] – Expected Local Contribution

Here is what makes up a District’s State Aid:

Foundation Cost: This is the cost of educating the average student to the learning standards, based on a study of successful schools, using instructional costs and adjusting for regional cost, efficiencies, and number of needy pupils.

Pupil Need: High need students require more help, so the Regents proposed a weighting that increases spending for them.

Regional Cost Index: Additional funds would go to schools in areas where wages and the cost of living are higher.

Expected Local Contribution: Funding is a State and local partnership. The expected local contribution is based on the district tax base multiplied by the expected local tax rate. The district tax base is the total property value of the district. The expected local tax rate is based on local ability to pay, as measured by the district income per child. Lower income communities would be expected to contribute less. Higher income communities would be expected to contribute more. However, the expected local contribution is not mandatory.

The foundation formula includes most of the State funding of schools, but not all. Important categorical aids that are still kept separate include building aid, transportation aid, aid for special education students, textbook aid, aid for limited English proficient students, BOCES aid and universal pre-K.

The Impact

Under the Regents proposal, full funding in the foundation formula would be phased in over 7 years. When fully funded, State Aid in the foundation formula would need to increase by $5.98 billion at the end of the 7 years. This does not include possible increases in other aids, such as building aid, that are not included in the foundation formula.

The Regents proposed the total State Aid increase for 2004-2005 should be $880 million, including $508 million from the foundation formula.

Attached are slides from the news conference and the policy paper that the Board of Regents adopted today.

News Conference Slides: HTML file | PowerPoint file

Policy Paper: HTML file | PDF file