In a prior post, I showed how far New York City lagged beyond the rest of New York State in public school spending in FY 2005, with a conservative cost of living adjustment applied to Downstate expenditures. Using data from the U.S. Census Bureau for Fiscal Years (FY) 1997 and 2004, however, we find that inflation-adjusted per-student current expenditures for the city’s schools increased 46.7% from the former year to the latter. And whereas the city’s per child current spending was 2.3% below the national average in FY1997, it was 19.2% above average in FY2004. The spreadsheet is attached, and I'd rather have you download that than read the rest of this post. Once you have, to compare your explanations to mine, my overview of the breakdown by type of spending follows.
In FY1997, the city’s instructional wage and salary spending (teachers’ pay) per student was 4.9% below the national average when conservatively adjusted for the cost of living. At the time, class sizes were much larger, due in part to growing enrollment, and the city had a revolving door of uncertified teachers that would become worse as the economy improved toward the end of the decade. From FY1997 to FY2004, however, per child teacher pay increased 32% after adjustment for inflation. (This was actually the lowest expenditures per pupil gain in New York City during this time aside from “pupil support,” on which expenditures fell.)
Although the per hour wage increases granted to teachers did not exceed inflation by nearly that amount, uncertified teachers were replaced with higher-paid certified teachers as enrollment ebbed and the city was better-positioned to compete with higher-priority school districts in the suburbs. In addition, the end of “social promotion,” which I always refer to as “fiscal promotion,” meant more children receiving additional instruction after school or in summer school. This meant more teaching hours, and more total pay for teachers, a trend that has presumably increased as social promotion has been eliminated in upper grades. By FY2004, the city’s instructional wage and salary spending per pupil was 7.9% above the national average.
New York City’s per child spending on teachers’ employee benefits, such as pensions, was always much higher than the national average, reflecting the union’s preference for richer health benefits and pensions, particularly for teachers with seniority, rather than pay. In FY1997, NYC’s per-child spending in this category was 27.3% above the national average. But after a 68.9% inflation-adjusted gain, it was 80.9% above the national average in FY2004, even after adjustment for the cost of living. That is nearly double. The 2000 pension enhancement, which jacked up pension cost for NYC, was presumably a big part of this. In the rest of the country, however, many jurisdictions are under-funding their pensions to a far greater extent than the city. A huge cost, therefore, may have been deferred, assuming it will be honored. As I’ve argued elsewhere, it is entirely possible that, by hook or by crook, governments will renege on pension obligations in the future to avoid fiscal disaster.
The largest gain in NYC instructional spending was in other categories, such as books and teaching supplies, for which its per-student inflation-adjusted spending more than doubled. Total instructional spending per student rose 52.5% in NYC from FY1997 to FY2004 after adjustment for inflation, from 12.4% above the national average (even with adjustment for the cost of living) to 44.4% above the national average.
New York City’s expenditures outside the classroom have always been low, compared to the national average and especially the massive spending in the rest of New York State. Total per child expenditures for support services, after adjustment for the cost of living, were 27.1% below the national average in FY1997 and, after a 36.1% inflation-adjusted gain, 20.0% above the national average in FY2004.
As mentioned previously, inflation-adjusted per student spending on “pupil support” services, including social work, counseling, placement, and nursing, fell 38.8% from FY1997 to FY 2004. Already 37.3% below the national average in the former year, the city was 70.3% below average in the latter. Recall that all the teachers’ aides were laid off after the advent of Mayoral control. Some of the savings went to hire parent coordinators as part of the principals’ offices. These offices fall into the Census Bureau’s “school administration” category, for which spending per student more than doubled between the two years, rising from half the national average in FY1997 to just 10% below average in FY2004. Also more than doubling per child when adjusted for inflation: spending on “general administration,” the central staff. Spending in this category is a small share of the total, however, and remained 16.2% below the national average.
The Mayor has put a big emphasis on curriculum development and teacher and principal training, which would fall into the Bureau’s “staff support” category. And indeed the city’s per pupil spending increased 133% between the two years after adjustment for inflation, more than in any other category. The gain was from a low base, however, from 88.6% below the national average in FY1997 to 81.3% below the national average in FY2004. Also included here: media, library, audio-visual, and computer-assisted instruction support.
The Bureau’s annual report doesn’t break out building operation and maintenance, pupil transportation, warehousing and supply services, back office and accounting, and other non-specified support services separate. Collectively, however, the city’s per child spending in these categories, adjusted for the cost of living, was 2.9% above the national average in FY1997, with the city’s notoriously well-paid custodians presumably offsetting the low share of its students who ride school buses to school. The Mayor has targeted this area for savings, but it hadn’t paid off by FY2004: the city’s expenditures per child were 8.5% above the national average, adjusted for the cost of living, that year.
It should be noted that while the city’s per student current expenditure adjusted for the cost of living is above the national average, its total expenditures as a share of its residents’ personal income remains below the national average. Why? First, for the former I exclude the highest-paid people Downstate, those working in Finance and Insurance, as irrelevant to the labor market for the rest of us, including teachers; the latter calculation includes the income of all city residents, including the hedge fund traders who live here rather than commute in. Second, the number of public school students in the city is low relative to its overall population and personal income, as the low quality of its schools has traditionally driven parents to the suburbs or private schools. This permits higher per-student spending at a lower share of personal income.
Unfortunately, the Bureau’s data is not sufficiently detailed to provide a good comparison with the rest of the state in years when there isn’t a Census of Governments (1992, 2002, 2007, etc0. As I’ve written elsewhere, the Office of the State Comptroller could provide equivalent data each year, but does not. Nonetheless, I’ll look forward to the availability of FY2005 data. Perhaps I’ll compare with FY2002, the last year before Mayoral control. For interest’s sake, not as a way of criticizing anybody.