The foundation aid formula needs an update

On Board Online • January 10, 2022

Robert S. Schneider
NYSSBA Executive Director

There was a time when I left for school in the morning with a little extra swagger in my step, thanks to my first pair of bell bottom jeans.

Business casual trends aside, I doubt my old bell bottoms would impress anyone as a bold fashion statement today. Many things that were innovative and trend-setting in the past need updates to function well in today's world. Just consider how often you get a software update notification on your mobile phone or home computer.

The same can be said for New York State's foundation aid formula. The formula was groundbreaking when it first appeared in 2007. But it needs some updating.

The goals of the foundation aid formula remain sound and are worth preserving. The formula was meant to be a stable, reliable mechanism to provide predictability for local budget planning. It also was intended to enable fairer distribution of state school aid, in line with district needs. The idea was to provide each school district with enough resources to provide each child with what New York's highest court has said the state Constitution requires: a "sound basic education."

The formula has always been weighted to recognize factors like student poverty, regional costs, fluctuations in enrollment, the number of students in need of special education and English language supports, district property wealth and other variables that can affect the cost of educating students or a district's ability to raise local revenue.

But the state stopped honoring the formula almost as soon as it was enacted. The financial downturn known as the Great Recession hit the state hard, with belt-tightening all around.

Instead of driving more school aid to where it was most needed through a carefully designed formula, the governor and the Legislature gave schools a tough-to-anticipate patchwork of state aid categories and funding streams that worked awkwardly with the hobbled formula.

Our state took a major step with the 2021-22 state budget, which resumed the foundation aid formula phase-in and again began the climb to full funding. Gov. Kathy Hochul delivered welcome news in October when she committed to full funding over the course of the next two state budgets and agreed to settle a lawsuit (which NYSSBA joined) that pushed the state to make good on its original foundation aid commitment.

But there is a problem. Just like my old bell bottoms, the original foundation aid formula is a bit out of date. School districts and the state are continuing to deal with changing educational standards, new programs, ever-evolving technology and growing student needs.

That's why New York needs to conduct a "costing-out" study to determine the actual cost of providing a sound basic education today.

Adjustments to the foundation aid formula also are needed to make it a better fit for today's schools and students. NYSSBA recommends these common-sense steps:

  • Adjust weightings for high-need students. Our state now has nearly a quarter-million English language learner students. Special education enrollments jumped by more than 16% between 2012 and 2020. Meanwhile, enrollment has declined, and our high-need students require more services than they did a decade ago.
  • Improve data collection for measuring student poverty. A system that uses information that's more than 20 years old is bound to be plagued by inaccuracies and distortions.
  • Update the Regional Cost Index. This hasn't been updated since the original formula was introduced in 2007.
  • Account for enrollment declines. Some features of the formula adversely affect districts with declining enrollments.
  • Adjust expectations for local funding. The formula was crafted before the local tax cap was in place.
  • End the use of "set-asides." Some portions of foundation aid are carved out only for specific purposes, such as community schools, regardless of whether a district has or wants to have such a program.

So, let's aim for a foundation aid formula that suits our needs today and is flexible enough to adjust for tomorrow.

I can't guarantee that the formula will be in style forever, but if we build it with durability in mind and tend to regular maintenance, it might hold up much better than my old bell bottom jeans.

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