The district strongly advocates for the New York State Legislature and Governor Andrew Cuomo to immediately:
Reform the state aid distribution system to provide for more equity.
After a court order in 2003, New York state adopted a new school finance formula that was meant to adjust for need and cost in each district. The Foundation Aid Formula was supposed to ensure a fairer, more predictable distribution of aid, but it has yet to be fully implemented and instead has been frozen since 2009-10. In September 2012, a report on school funding by the Center for American Progress found that New York has a “regressive” state aid distribution system where inequity in funding persists. More recently, a national report card on school funding in all 50 states gave New York high marks for funding adequacy and statewide effort, but it earned a grade of F for funding distribution.
The current state aid distribution system appears to distribute funds at least partly based on the philosophy of making sure every school district gets a share. In practice, this means well-funded districts in wealthier communities receive a level of state aid (allowing for expanded programs and services) that is disproportionate in terms of need when compared to less funded districts that would benefit more from the aid.
Without some reform, districts with below average wealth — like Stillwater — will also continue to suffer the greatest negative impact when the government reduces Foundation Aid Formula amounts. Under the state’s tax levy cap, the less funded districts (with smaller annual budgets) are less able than wealthier districts (with large annual budgets) to compensate for state aid losses by raising revenues through taxes.
About Combined Wealth Ratio (CWR)
The Combined Wealth Ratio (CWR) is the state’s measure of wealth in a school district. It compares each school district against statewide averages based on two factors: property wealth per pupil and income wealth per pupil. The State Education Department has determined that a school district with average wealth has a CWR of 1. As you can see from the numbers below, Stillwater’s CWR is lower than state and country averages. Throughout the state, CWRs range from a low of 0.165 to a high of 43.325.
- Stillwater Central School District: 0.73
- Saratoga County Average: 0.90
- State Average: 1.00
Maintain the interest rate used in state building aid calculations for a capital project at the level in use when the capital project was originally bonded.
After voters approve a capital project, a school district goes through a multi-step process before actual construction begins, including finalizing plans, submitting those plans for state approval, getting bids for the work and securing a lump sum of money through bonds to finance the project. A district pays down the principal and interest costs of the bond over time through debt service payments, for which they receive a state-calculated level of building aid reimbursement.
Education law enacted in 2001 requires the N.Y.S. Education Department to reset the interest rate used to calculate building aid payments made to school districts for capital projects at least once every 10 years. As the law currently exists, the Commissioner must revise the payments if the current interest rate is at least one quarter percent lower than the interest rate used to calculate reimbursements at the time the project was bonded. This could reduce school districts’ anticipated state building aid payments by hundreds of thousands of dollars—both retroactively and going forward—according to information provided by the Education Department.
The effect of this law is to penalize school districts and local taxpayers for previously approving a capital project when outside market forces set interest rates at a higher level. It essentially allows the state to reduce yet more aid for public schools by not honoring its past promises of support. Legislators have so far postponed full implementation of the interest rate reset law, but they must take action to ensure it is permanently prevented from harming school districts.