If wishes were horses, the recent Albany news conference by the New York State Educational Conference Board could be restaged as the Charge of the Light Brigade — a doomed assault against budgetary reality.

The group, which includes school boards and administrators as well as New York State United Teachers, said school districts will need a state aid boost of $1.2 billion next year “just to maintain current services” while staying within the state property tax cap.

The Educational Conference Board also said schools need another $700 million “to move forward on critical initiatives,” including full-day pre-K. That’s a $1.9 billion increase in state aid, up nearly 9 percent over the $22 billion budgeted in the current school year.

The board’s “minimum” is $336 million higher than the $864 million school aid increase already built into Gov. Andrew M. Cuomo’s financial plan for the fiscal year that starts April 1. He would need to spend $1 billion more to hit the group’s preferred target.

Educational Conference Board members don’t think it should be too hard to find the money. They said in a research paper, “New York’s fiscal outlook has improved substantially” and “state budget surpluses are projected through 2018.”

In fact, based on spending trends, Albany still faces shortfalls. Surpluses will materialize only if Cuomo sticks by his pledge to hold spending growth to 2 percent a year, roughly the inflation rate.

Without touching K-12 school aid, Cuomo will need to reduce projected spending on everything else by $2 billion if he wants to meet his 2 percent growth goal next year. Holding the line will get harder, because Cuomo’s budget staff now estimates that state pension costs over the next few years will be billions higher than previously projected, based on revised actuarial tables that show retirees are living longer.

As another source of ready cash, school officials also pointed to an unprecedented $5.1-billion windfall the state will collect from New York-based banks that admitted to engaging in illegal transactions. Cuomo’s office appropriately labeled that idea “a non-starter.”

Cuomo’s press secretary said the governor was committed to using the windfall responsibly and not to “satisfy unsustainable and shortsighted special-interest demands now with no plan to pay for it in future years.”

The schools’ aid demands are driven primarily by rising pay and benefit costs, Educational Conference Board leaders acknowledged. They juxtaposed the impact of New York’s 2 percent property tax cap with a projected 3 percent average salary hike for school employees next year — a number they said was in line with projected 2015 salary growth for U.S. workers.

When it comes to compensation, however, public schools aren’t comparable to employers in the broader economy. A majority of organizations have some incentive pay plan, according to the same human resource experts whose salary projections the Educational Conference Board cited.

Most private firms also expect salaries to vary based on meeting goals for the year. Of course, pay linked to results and performance is virtually unheard of in the public sector — and is anathema to teachers unions.

The Great Recession showed that New York’s generous state school aid promises were unsustainable. Cuomo’s tax cap has prevented school districts from passing along an undiminished bill to property owners. Unfortunately, while schools have begun to tighten their belts, they are still too immersed in wishful thinking.

About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

You may also like

Bear market spells big trouble for NY state and city budgets

Wall Street generates an outsized share of New York’s tax revenue, so the recent drop in stock prices should worry both Gov. Kathy Hochul and Mayor Eric Adams. Read More

Upstate New York will foot the bill for downstate’s clean energy costs

How should we pay for cleaning up downstate New York’s energy supply, and who should foot the bill? Read More

Albany’s latest gift to the teachers union will shackle NYC schools — and their budgets

The Legislature last week put a new spin on the debate over “mayoral control” of New York City’s schools by shackling the Big Apple with a costly class-size mandate. Read More

What constitutes price gouging? It’s complicated

Chazy Hardware had only one electric generator in stock when a 1998 ice storm left much of northern New York state without power for days. The store's owners found more in Vermont and resold them for a premium to cover its extra costs, little knowing they Read More

New York’s climate plan will cost hundreds of billions —and Albany is trying to hide it

Public Service Commissioner John Howard recently warned that the state’s climate-action scheme will cost New Yorkers “hundreds of billions of dollars” Read More

Albany returns to the bad, old stinky ways of passing a budget

For 20 straight years, the New York state budget was late — stretching well past the April 1 deadline, sometimes even into summer or fall. That streak was broken in 2011. It was then that lawmakers in Albany assured New Yorkers that the days of three me Read More

Hochul’s big-spending budget is largely Albany business as usual

In declaring that a state budget deal — albeit a tardy and undercooked one — was finally at hand, Gov. Hochul was oddly flanked at her Thursday afternoon press conference not by the Legislature’s leaders, but only Lieutenant Gov. Brian Benjamin and Read More

Pathetic New York pols fail again to deliver gerrymander-free maps

For the second consecutive time, a court-appointed special master will handle New York’s congressional redistricting. Read More

Subscribe

Sign up to receive updates about Empire Center research, news and events in your email.

CONTACT INFORMATION

Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@EmpireCenter.org

About

The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

Empire Center Logo Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!