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Critics Poking Holes in Cuomo's School-Finance Balloon

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Gov. Mario M. Cuomo of New York has called on the legislature to pass a new school-finance system that would consolidate 15 current state-aid formulas and begin basing payments to local districts more on local income levels than on property wealth.

In the wake of the proposal, contained in the fiscal 1994 budget released by Mr. Cuomo last month, however, school district and legislative officials have lashed out at the Governor for attempting to overhaul the school-finance formula at the same time he is calling for a $130 million cut in state aid.

Observers last week noted that the Governor's plan comes as the state board of regents is looking at proposals along the same lines and many educators and policymakers agree that changes are needed in the state's inequitable and complicated school-finance system. But critics called Mr. Cuomo's plan hasty and flawed and said that while the Governor was highlighting important issues, they were not willing to accept his solutions.

The Governor argues that the state's focus on property value, combined with a heavy reliance on property taxes to fund the local share of school costs, has produced an unfair system. Records show that per-pupil spending in New York school districts in 1990-91 ranged from about $5,200 to $30,000.

Mr. Cuomo said his plan would consider regional cost trends, local tax effort, and the special needs of disadvantaged children, boosting aid to about 40 percent of the state's districts. Others, however, would stand to lose funds.

A Mask for Cuts?

Urban and rural districts are expected to gain funds under the plan. Suburan districts would be among the biggest losers, observers said.

School officials, disappointed by the Governor's call for a 1 percent cut in state aid, found little reason to cheer for the plan, which while limiting districts to funding gains of no more than 1 percent would allow losers to see drops of up to 13 percent.

"What the Governor has proposed on the surface is to take the first step toward simplifying the finance system,'' said William J. Pape, the director of communications for the New York State School Boards Association. "Unfortunately, we're afraid what he's really trying to do is just mask other cuts in education.''

Mr. Cuomo's plan to cut aid to regional education boards and fold transportation aid into the general formula could cost local districts an additional $300 million, according to James O'Connell, the executive director of the New York State Council of School Superintendents.

"This sounds good, but it raises more questions than it answers,'' he said. "His proposal is not popular.''

The proposal has also won lukewarm support from several key lawmakers, who have turned back earlier efforts by the Governor to reform the finance system.

Mr. Cuomo has vowed to push ahead with his plans to shake up school spending, however.

In addition to his finance proposal, the Governor in his budget address said he would deliver to lawmakers by April 1 a plan, announced last month in his State of the State Address, to give counties the option to vote to convert their local school funding from a property levy to a local income tax that would be a surcharge on the state's tax.

Continuing his criticisms of the large salaries paid to some school administrators, Mr. Cuomo also promised to name a task force that will survey district and Board of Cooperative Educational Services salaries.

Regents Eye Finance Changes

After viewing Mr. Cuomo's proposal, some school officials said they would rather wait for the state regents to complete their work on revamping the finance system. The board last fall promised to make devising a more equitable funding plan a top priority in the next two years.

The board's finance plan was wrapped around its funding request for fiscal 1994--an increase of more than $450 million--largely to support current programs and the existing finance system, which employs more than 50 separate formulas in alloting money for school programs.

The regents said they wanted to establish a sound level of basic per-pupil funding for districts while making the new formula sensitive to local needs and wealth factors, thus providing greater fairness to state taxpayers.

The board's plan, which is expected to be presented to lawmakers in time for the 1994 session, aims to fold all 53 aid categories into three funds.

Operating aid would provide a minimum-foundation funding level, capital-needs aid would help fund bus and transportation supplies and meet expenses for supplemental costs, and extraordinary-needs aid would add funding to poor districts or areas with high levels of poverty, according to officials in the state education department.

'Asking the Right Questions'

School officials said that while they would like to see the state work toward major revisions in the school-finance program, they doubted that the Governor's proposal was strong enough to spur such action.

"We all support this concept,'' said Mr. O'Connell. "But the districts with less ability to raise funds need a greater share of new state aid. It's really not realistic at this time to propose this shift, after we've lost so much, unless there is an infusion of new money.''

Local school officials also pointed to the need to consider a number of questions that would affect revisions in the finance formula.

Shifting from a system that bases state aid on property values to one that bases assistance on income presents a number of logistical concerns, said John E. Sackett, the district superintendent of the Rensselaer-Columbia-Greene BOCES.

"There's a strong disagreement within the education community on how you weigh those two factors,'' he said, noting that officials have concerns about moving to a system based more on income because less data exist on local income levels. Moreover, school districts cannot define the wage earners within their boundaries as easily as they can identify property.

"The Governor is asking the right questions,'' Mr. Sackett contended, "but his solutions obviously represent his political power base. The board of regents is conducting an extensive evaluation of these issues and I would be much more inclined to wait for the board to propose solutions before we begin to work on this.''

Other school officials, however, recommended opening the legislative discussion on the issue and trying to amend the Governor's plan.

"We don't need a longer look,'' said Mr. Pape. "As this stands, we're not willing to go with it, but we would be willing to negotiate.''

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