BILL NUMBER: S8579

SPONSOR: JACKSON
 
TITLE OF BILL:

An act to amend the education law, in relation to making a city school
district in a city having a population of one million or more eligible
for transitional aid for charter school payments

 
PURPOSE:

To make NYC eligible for transitional aid for charter school payments

 
SUMMARY OF PROVISIONS:

Section 1. The opening paragraph of subdivision 41 of section 3602 of
the education law, as amended by section 20 of part B of chapter 57 of
the laws of 2008, is amended to read as follows: In addition to any
other apportionment under this section, for the two thousand seven--two
thousand eight school year and thereafter, a school district shall be
eligible for an apportionment in an amount equal to the sum of

              

Section 2. This act shall take effect April 1, 2024

 
JUSTIFICATION:

All school districts in New York State, except New York City, are eligi-
ble to receive transitional aid from the state to offset a portion of
the cost of charter school growth. New York City schools have been
deprived of $2.81 billion in transitional aid from 2011 to 2023. 1

New York City is the only district in the state that is exempt from this
assistance, and city schools will miss out on an additional estimated
$93 million in transitional aid during the current school year. In addi-
tion, New York City is statutorily required to provide rental assistance
to charter schools, the only district in the state, and indeed the
nation, with this onerous financial obligation.

There are 343 charter schools statewide, and 267 of them are in New York
City. The continual exclusion of New York City, the district most satu-
rated with charter schools, from transitional aid is manifestly unfair.

Public school districts pay tuition to charter schools for each student
enrolled. As previously documented, since 2008, New York State school
districts are eligible to receive annual transitional aid if the number
of students in charter schools is more than 2% of total district public
school enrollment, or if total payments from the district to charters is
more than 2% of the district's general fund expenditure.

Transitional aid is based on the year-to-year increase in charter school
enrollment multiplied by a factor of the charter school per pupil
tuition amount. Since the inception of transitional aid, $546 million
has been distributed to districts statewide, with the exception of New
York City. New York City's ineligibility is the result of former City
Mayor Michael Bloomberg's decision 16 years ago to forego this state aid
in exchange for permission from the state to expand the number of char-
ter schools in the city.


In the 2022-23 school year, 116,957 students were enrolled in eligible2
charter schools and 849,863 in traditional public schools.  During that
year, New York City allocated $2.75 billion in general fund payments to
charter schools, representing 9% of total expenditures and 11% of eligi-
ble student enrollment, well above the 2% required to qualify for tran-
sitional aid.

New York City would have received $2.81 billion in transitional aid from
2011 through 2023 to offset the cost of substantial charter school
growth during that period. The chart below shows estimated transitional
aid to New York City that would have been provided each year, along with
total transitional aid distributed to other districts in the state. The
downward trend in aid for New York City is due to a slowdown in charter
enrollment growth, starting in the 2019-20 school year, compared to
growth rates in prior years.

For years, students in New York City district schools have been short-
changed at least twice: by the state's refusal to fully fund Foundation
Aid, the state's school funding formula, and by the diversion of vital
state aid away from district schools to charters.

In addition, the New York City Department of Education (DOE) has been
required since 2014 to provide space for all new and expanding charter
schools in DOE school buildings, or to subsidize their rent in private
buildings. While the state covers 60% of that cost, the Independent
Budget Office estimated that New York City public schools still spent
$75 million in the 2022-23 school year on charter lease assistance,
after taking into account the state reimbursement. This amount is
increasing fast and is likely to continue to do so as charter enrollment
and rental costs grow.

New York State must extend charter school transitional aid to New York
City schools and this legislation will do just that!

 
LEGISLATIVE HISTORY:

New Legislation

 
STATE AND LOCAL FISCAL IMPLICATIONS:

To be determined

 
EFFECTIVE DATE:
This act shall take effect April 1, 2024