Senate Bill S4215

                                BILL NUMBER:S4215

TITLE OF BILL:

An act to amend the education law, in relation to providing an annual
growth amount for tuition reimbursement for school age programs
operated by in-state approved private schools for the education of
students with disabilities and special act school districts

Purpose of the Bill:

To provide an annual growth amount, correlating with New York State
personal income growth, in the tuition reimbursement rate for school
age programs operated by in-state approved private schools for the
education of students with disabilities and special act school
districts.

Summary of the Provisions of the Bill:

Section one amends paragraph c of subdivision 4 of section 4405 of the
education law to provide that for the 2015-2016 school year and
thereafter, annual tuition rates for special act school districts and
in-state approved private residential or non-residential schools
educating students with disabilities that are located within the state
shall increase by the greater of a three year average of State-wide
total personal income or zero.
              

Section two is the effective date.

Statement in Support of the Bill:

Tuition reimbursement for Special Act School Districts and Approved
Private Schools Serving Students with Disabilities (853 Schools) is
based on a rate methodology that is established by the Department and
approved by the Division of Budget (DOB). Following four years of zero
growth in tuition reimbursement, the 2013-14 rate methodology included
a three percent trend factor for direct care costs of school age
providers as recommended by the Department. The 2014-15 rate
methodology included a three and eight tenths percent trend factor,
which equaled the three year average of state-wide total personal
income growth. These increases provided short-term relief, but did not
address many of the shortcomings of the current system.

At the November 2012 meeting, the Board of Regents directed the
Department to create a Special Education Financial Advisory Workgroup
to allow all interested stakeholders to provide input on the current
tuition rate-setting structure for special education providers and
discuss recommendations to maximize the efficient and effective use of
state and local resources. This workgroup held two meetings in May of
2013. Based on provider testimony at the Special Education Financial
Advisory Workgroup meetings, and SED analysis of submitted cost data,
a lack of predictable growth to fund increasing costs and many
technical aspects of the current rate setting methodology, have
endangered the capacity of Special Act School Districts and 853
schools to operate essential special education programs for the some
of the most severely disabled school age children.


To assist in the financial recovery of Special Act School Districts
and 853 Schools, the Work Group representatives strongly endorsed the
need for statutory changes - with particular emphasis on the
establishment of an annual tuition rate growth factor. This
legislation would create a statutory index for establishing the growth
in annual tuition rates based on a three year average of personal
income of taxpayers in the state. The current growth in tuition rate
is established administratively and is not based on a predetermined
index. A statutory growth index based on an average of state personal
income growth would establish predicable and timely tuition increases
and allow for improved budget planning.

Budgetary Implications of the Bill:

There is no cost to the state during the 2015-16 school year. Using
past data, it is projected that a trend increase for tuition based on
a three year average in total personal income growth (3.4%) would
provide an additional $25 million in billable tuition for these
schools in the 2015-2016 school year. This amount would be paid by the
placing school district or social service district as part of the
annual tuition amount and for the placing school district these costs
would be eligible for private excess cost aid and July and August aid
under Education Law § 4408.

Prior Legislative History:

In 2014, this bill was introduced by the Senate as S.7638, was
referred to the Education Committee and no further action was taken.
It was also introduced by the Assembly as A.9767 and was reported from
the Education Committee and referred to the Ways and Means Committee
and no further action was taken.

Effective Date:

The bill would take effect immediately.