The New York State Department of Education has released its public school finance “masterfile” for the 2006 to 2007 school year. It may be found here. I’ve taken some of the data items in the file, attached more easily understood titles from the glossary, and done some summations, calculations and adjustments. The results are attached, and are discussed after the break. The data is for the school year impacted by former Governor Pataki’s last budget. It was Pataki’s first budget that slashed New York City’s state school aid, always low in proportion to its number of children, while increasing aid to the rest of the state. The observable results, among other things, sent my children out of the public school system and some of their friends out of the city. Later, Pataki instituted the STAR program, which directed more resources to school districts with the most, sending spending outside New York City to the moon. For a while it seemed that total state aid per student to the affluent downstate suburban counties, on average, would exceed the amount provided to New York’s generally impoverished children. But perhaps under pressure from the Campaign for Fiscal Equity lawsuit, Pataki reversed course. For fiscal equity, ironically, his last budget may be as good as it gets for the city’s children.
In the spreadsheet, I’ve created summary statistics for the downstate suburban counties — Nassau, Suffolk, Westchester, Rockland and Putnam, and for Upstate New York. New York City, by itself, is a third region of the state. The data for individual school districts outside the city is kept, in alphabetical order.
I’ve created a state aid per student total for each of these areas. New York City received 37.4% of total New York’s total state elementary and secondary education funding in FY 2006-07, its traditional share, with 38.7% of school aid that is called school aid and 30.8% of STAR aid. That is more than the city’s 36.4% of total state school enrollment. In Pataki’s first budget for FY 1995-96, in contrast, New York City had 37.2% of the state’s students (a share that was rising) but received only 29.6% of total state education funding, down from 33.2% the year before. The city’s share of state school aid, though not the absolute amount, was also cut in response to state fiscal problems after 9/11.
Although I don’t have data for every year (prior to the data being published on the web, I got it from back issues of the New York State Statistical Yearbook, which wasn’t published every year), FY 2007 is apparently the first year that the city’s share of state education funding exceeded its share of the state’s school children. They had been equal in the 1989-90 school year, at the end of another economic boom. In general, the city’s share of school aid has risen in fiscally flush times, once all the other interests have been satisfied, and been cut in recessions, to maintain more powerful interests in the style to which they have become accustomed. And in fact the evidence is that the city’s share is already falling again in the current recession.
In former Governor Spitzer’s first budget presentation, he proudly showed that despite his settlement of the Campaign for Fiscal Equity lawsuit, New York City’s share of total state education funding (including his additional STAR relief) would not go up one bit. When that budget for fiscal 2007-2008 was finally settled, even more additional STAR money was directed primarily to school districts outside the city, particularly on Long Island. Spitzer’s budget director agreed to provide the press with a tabulation and an admission that yes, the city’s share of state education funding had been cut by Spitzer’s second budget. No such tabulation was provided in Spitzer’s second budget, but the scuttlebutt is that the city’s share had been cut again. Those of us on the outside will, I suppose, have to wait until December 2010 to find out how much.
Since then, of course, the recently admitted recession has intensified, and given the past pattern, one wonders what the next state budget will bring — and if anyone will be able to find out. Governor Paterson’s proposal already eliminates all general assistance to New York City while maintaining it at prior year levels for all other localities in the state, including many that are, on average, far more affluent. The reason given by the Governor is that while other parts of the state would be forced to raise property taxes if they aid were cut, New York City could raise other taxes — in addition to the property tax increase already imposed. Presumably nobody notices paying those. Governor Paterson’s budget proposal has already been criticized by Dean Skelos for unfairly favoring New York City. Perhaps because the city’s school aid isn’t also cut to zero.
The expected reduction in the city’s share of state education funding, in the years since the data here presented, has been accompanied by an increase it total state aid, but this is about to be reversed. Once the reversal occurs it is likely that one of the main effects of the Campaign for Fiscal Equity lawsuit will be in big increase in spending in the rest of the state, where it was already sky high, financed in part by money extracted from New York City taxpayers, who generally pay in excess of 40% of New York State income taxes paid by state residents, even when Wall Street is down, as can be found here. Which may or may not be a loss for the lawsuit, given that the state courts found that the City of New York could not be a plaintiff against the state (because it was being sued too) but the New York State Association of School Boards, representing schools in the rest of the state, could.
Next up, I present total expenditures per student with an adjustment for the cost of living in high-cost downstate New York. The adjustment, as I usually do it, is based on average private sector wages excluding the high-paid finance industries, relative to the national average. I found, using covered employment (ES202) data for all of 2007, that a dollar of school spending downstate was worth only 76 cents because of higher general wages and living costs, which require higher pay to attract education workers of equal quality. That ratio has remained relatively constant for many years. It will be interesting to see how the recession affects this figure. I expect the big drop in New York’s average wage relative to the U.S. is likely to occur in finance, and thus not affect this calculation — outside finance the number of jobs rather than pay per job is likely to fall. In any event, to equalize the value of spending I multiply per child spending in New York City, the Downstate suburbs, and all the school districts in the Downstate suburbs, by .76.
For many years, once the higher cost of living downstate has been factored in, public school expenditure per student in Upstate New York and the Downstate suburbs have been about the same, with New York City lower. For FY 2006-2007 the adjusted figures are $15,244 for the Downstate Suburbs, $15,086 for Upstate New York and $13,496 for New York City. In fiscal 2006-2007, however, the gap between New York City in and the rest of the state was much less than in the past. Moreover, adjusted per pupil spending was actually lower than in New York City in school districts accounting for 23.9% of the school children in the rest of the state. When I first stated compiling this data, virtually no school district in New York State spent less than NYC once the adjustment was applied (with Roosevelt, whose spending is also much higher now, generally among those rare exceptions).
To give one the devils his due, many of the districts spending less than NYC are located along the south shore of Long Island, the area represented by Dean Skelos, but not Rockville Centre, his hometown, which had per student spending of $16,143. I’m not sure what school district past State Senate education chair Steve Saland lives in, since he lists his address as the Town of Poughkeepsie and there are several in that town. Four of them spent more than NYC — Arlington $14,613, Hyde Park $14,975, Spacekenkill $17,350, and the City of Poughkeepsie $16,432. One spent less — Wappingers $12,976.
There is no national equivalent to this state administrative data. For that, we’ll have to wait for its Census Bureau equivalent for the FY 2006 – 2007 school year, which should be available in May of next year. Assuming, however, that the ratio of NY State spending in this series, to NY State spending in the Census series, was unchanged from FY 2006 to FY 2007 (the census data includes more), and the increase in the national average spending per pupil was equal to the increase in New York State between the two years, then the national equivalent to the figures in the NYSED data — $15,244 for the Downstate Suburbs, $15,086 for Upstate New York and $13,496 for New York City — would be $11,199. That New York City was well above the U.S. average, even with an adjustment for the cost of living, is a change from the past — one that could be soon reversed. For a real comparison between the U.S. and New York State’s regions and school districts using Census Bureau data for FY 2005-2006, download the spreadsheets attached to this post.
I’ve done one more set of calculations — spending on teacher pensions as a percent of teacher wages, which is the equivalent of a private sector employer contribution rate for private sector workers’ 401Ks. The pension contribution rate was 10.0% of teacher wages in the Downstate Suburbs, 9.8% in Upstate New York — and 21.9% for New York City. New York City accounted for 40% of the state’s spending on teachers salaries in FY 2007, but 59.7% of its spending on teacher pensions.
New York City funding is about to be drastically shifted from teachers salaries to teacher pensions, with the salaries falling and the pension contributions soaring. Required pension contributions are set to explode everywhere and for every type of public employee, as a result of massive stock declines and bond credit losses, plus hedge fund implosions and real estate crashes. But for New York City schools the increase will be vastly greater due to the deal — made just one year ago — to allow teachers to retire at age 55 rather than age 62. In addition to inflating pension costs, this deal will also inflate the number of former teachers for which the city has to provide health insurance without the assistance of Medicaid. Unfortunately NYSED cannot distinguish between the cost of health insurance purchased for retirees and health insurance purchased for employees, because few school districts or other local governments provide data in that detail.
It should be worth noting that the NYC teacher’s union, which pushed for the pension enhancement, was also a party to the Campaign for Fiscal lawsuit. It may be that all the additional taxes paid as a result of that lawsuit, in addition to the amount going to pay for the steep rise in spending outside the city, will go to early retirement for teachers, leaving the city’s children no better off, and perhaps even worse off, than in the mid-1990s. If that is the case, the one thing I don’t want to hear is that it wasn’t the plan all along. Now that 25/55 has been achieved, I suppose, there is no need for the UFT to make any pretense of caring to improve the schools.
Indeed, there is no point in continuing Mayoral control, since the diversion of such a huge share of funds to the retired makes any future decisions, by Mayors or anyone else, moot. Might was well have the Mayor be in a position to deny responsibility, blame an unaccountable school board stuffed with lackeys, and shift resources to services that have hope, the way Mayors and Governors have done with the MTA — and Pataki and Giuliani did with the city’s schools. What could have been a decision a year ago is no an “unavoidable expense.” What Pataki’s first budget meant for the NYC schools, for years afterward, this pension deal will mean for the next decade plus. And any attempt to improve the schools thereafter will be met with the cynical response, from me among others sadly, that all that would be gained in the end is another few years of early retirement and higher taxes.
One other calculation surprised me: New York City accounted for 37.2% of all New York State school transportation expenditures, more than its share of the state’s total school children, some $935 million. That is $918 per child, or for a ten-month school year, $92 per child per month. Now I know that many of the children receiving school transportation services are disabled, and have expensive transportation requirements, and that the cost of living is higher in the city than Upstate. But I also know that in New York City, given its density, most children ought to be within walking distance of a school, and a minority require any school transportation services at all. So why so much?
Were it not for the fact that many of the bicycles would be stolen and some of the children run over and killed, it seems like everyone would be better off — and in better long-term health — if some of that money — say $100 million — was instead used to help children, particularly middle school children and those older, bicycle to school, while encouraging elementary school children to walk. That is yet another way school was better 40 years ago than they are today. One could pay for a lot of crossing guards, bike racks, locks, simple bicycles set up for transportation, street riding instruction and safety vests for $100 million. And the kids might as well get used to it. In the diminished future, when all the money is going to debts and pensions, they may not have a functioning transit system either.