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April 1, 2016

2016-17 state budget includes $1.5 billion education funding increase, end to GEA

On Friday, April 1, New York lawmakers approved a 2016-17 state budget that includes an overall $1.5 billion – or 6.5 percent – increase in education funding. The state budget ends the Gap Elimination Adjustment, which has diverted billions of dollars from schools during the last seven years.

The end of the Gap Elimination Adjustment (GEA) is welcome news for Niskayuna, and will enable the district to continue all current programs next year and make some targeted budget restorations and additions, as outlined in the draft budget presented at the March 22 Board of Education meeting. The Board will discuss, and potentially adopt, a 2016-17 school budget at its April 5 meeting.

The Legislature's vote on the budget came on the first day of the state's new fiscal year. The finalized spending plan provides school districts with information about state aid revenue that is critical as they develop their budgets for next year.

The bulk of the overall state aid increase will be split in three ways: a $627 million increase in Foundation Aid, $434 million to end the GEA and $341 million to reimburse schools for costs such as transportation, construction and BOCES services.

The budget also includes targeted funding for community school efforts in designated districts, an expansion of the statewide prekindergarten initiative for 3-year-olds and an increase in financial support for charter schools.

 

GEA eliminated, Foundation Aid increased

The state instituted the Gap Elimination Adjustment, or GEA, in 2009-10 to help address its own budget shortfalls brought on by the fiscal crisis at that time. Since then, school districts have lost a specified amount of state aid annually through the GEA. The end of it means that state aid will not be reduced in this manner in 2016-17, an effective increase in funding that totals $434 million statewide.

The $627 million, or 4 percent, increase in Foundation Aid - the primary source of funding for everyday school operations - is the largest since the fiscal crisis began. However, it is also well below the New York State Board of Regents' recommendation of a $1.3 billion Foundation Aid increase for next year. Included in the approved increase is $100 million for community schools initiatives in various districts across the state.

The Regents have highlighted the important role state aid will play in the year ahead due to the restrictive tax levy cap schools are facing. Due to low inflation last year, districts were required to plug a near-zero growth factor into the tax levy cap formula. This limits the availability of local revenue to keep up with cost increases in many districts.

 

Additional education policies and funding in the budget

The 2016-17 state budget also included the following provision related to education and funding:

  • Community Schools: The budget includes $175 million to help implement community schools initiatives in certain designated high-needs districts and for schools that have been identified as failing by the state. Community school efforts can include academic, health and social services for students and families. As noted above, $100 million of this funding is from an increase included in Foundation Aid for certain schools.
  • Charter Schools: The state budget includes nearly $55 million in additional support for charter schools statewide through an increase of $430 per pupil to a total of $14,457. This represents growth of 3 percent in per pupil funding.
  • STAR: The state budget does not cap annual growth in the School Tax Relief (STAR) program at zero percent, as proposed by the governor in January.
  • Universal Prekindergarten: The budget continues an annual investment of $340 million to support prekindergarten programs across the state and calls for an expansion for 3-year-olds. As of this school year, 460 of the state's 674 school districts offer prekindergarten slots to 120,582 children.