New state budget delays bus mandate, reforms Tier 6 and boosts foundation aid

On Board Online • June 8, 2026

By Brian Fessler
Chief Advocacy Officer

Shortly before midnight on May 27, the state Legislature finalized its work on the 2026-27 state budget. While this year's state budget represented the latest in 16 years - more than eight weeks late - patience paid off as the final agreement included some notable wins for schools.

For instance, school officials across the state are relieved that the budget included a five-year delay of the state's zero-emission school bus transition mandate. Prior to the delay, all new bus purchases made after June 2027 would have been required to be zero-emission (that is, electric). The budget pushes that date back to 2032. The deadline for each district having an "all zero-emission fleet" was delayed from 2035 to 2040.

"NYSSBA's advocacy has focused on a repeal or significant delay of the mandate, so this pushback represents an important advocacy victory," said NYSSBA President Christine Schnars, a member of the Jamestown school board and the Erie 2-Chautauqua-Cattaraugus BOCES board.

"The governor and Legislature listened to our concerns about what is realistic," said NYSSBA Executive Director Robert Schneider. "They have created a window for school districts, bus manufacturers and utility companies to continue to work on solutions to a number of implementation challenges."

The state budget also included more than $1 billion in new foundation aid for school districts, increasing the state's main school aid stream by nearly 4% over 2025-26 levels. Importantly, lawmakers agreed to boost the guaranteed minimum increase up to 2%, an improvement over the 1% increase originally proposed by Gov. Kathy Hochul in January.

Efforts to update and improve the foundation aid formula also continued, as the budget made two changes to how student need is measured within the formula: the creation of a new 0.12 weighting for students who are experiencing homelessness or are in the foster care system, and an increase in the weighting for English language learner (ELL) students from 0.53 to 0.60.

Combined with other reimbursement and categorical aids, total state aid for schools was increased by nearly $1.7 billion, or 4.5%, over current year levels.

Another significant provision included in the budget agreement addressed reform of the state's pension systems.

"Negotiations over potential reforms were taking place throughout the legislative session, and changes to Tier 6 ended up in the budget," Schnars said. "This was notable because neither the governor nor either legislative house included any changes regarding the retirement systems in respective budget proposals."

New York's public employee unions made pension reform a top priority as part of this year's budget work. NYSSBA was also supportive of such reform efforts, pursuant to a member-adopted position statement from 2024, which called on the association to "work with the New York State Educational Conference Board and its supportive members, to call on the New York State Legislature to improve Tier 6 in the current retirement systems for school employees and that we seek support and legislation to establish Tier Equity for Tiers 5 and 6 to be more aligned with Tiers 1 through 4."

Effective Oct. 1, members of Tier 6 of the state teacher's retirement system (TRS) will be eligible to retire, without penalty, at age 58 after 30 years of service. Previously, Tier 6 members with 30 years of service had to wait until age 63 to retire without penalty. Under Tier 4, which closed in 2010 on the heels of the Great Recession, TRS members can retire without penalty at age 55 with 30 years of service.

For public employees who are members of the state and local retirement system (ERS) and earn more than $45,000 annually, reductions were made to the employee contribution rate. The most significant reduction was made for earners between $75,000 and $100,000, who will see their contribution rate reduced from 5.75% to 4%.

The Legislature largely accepted Gov. Hochul's proposal to significantly expand universal prekindergarten for four-year-olds. Under the final budget, the minimum per-pupil state allocation is increased to the greater of $10,000 or the district's selected foundation aid per pupil for all new and existing full day 4-year-old seats. By the 2028-29 school year, districts will be required to provide a full-day prekindergarten seat for any eligible child whose parent or guardian seeks to enroll them. This seat could be provided at a district site, BOCES, non-profit, charter school, library, museum or another community-based partner.

While budget negotiations were ongoing, NYSSBA expressed strong support for the proposal to raise the per pupil funding levels to a minimum $10,000 but noted that simply increasing and streamlining the per-pupil allocation will not eradicate all barriers that school districts currently face in trying to provide prekindergarten for every student whose family seeks it.

Additional budget provisions included measures to shield sensitive locations, including schools, from incursion by civil immigration enforcement action. The State Education Department (SED) must create model guidelines for such policies within 45 days (mid-July), and school districts must implement policies based on the model guidelines within 60 days after that. These policies must then be certified as compliant by SED.

A comprehensive review of the budget that was drafted by NYSSBA's Governmental Relations team can be found at bit.ly/43Ea0oP .