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Published in Print: December 8, 2004, as N.Y.C. Schools Require Billions, Judge Told

N.Y.C. Schools Require Billions, Judge Told

Panel Recommendations Raise Political, Fiscal Ante in State Finance Lawsuit

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Bolstered by an independent panel’s endorsement, school funding advocates here will ask a state judge to order an additional $5.6 billion a year for New York City schools and a $9.2 billion capital-improvement program for the district.

Lawyers for the Campaign for Fiscal Equity said they will file motions soon—possibly this week—asking the state judge overseeing the state’s long-running school finance case to adopt the recommendations of a court-appointed three-member panel.

In their Nov. 30 report, the three jurists essentially endorsed the amounts the CFE requested in a series of hearings before the panel. They proposed that the $5.6 billion increase be phased in over four years.

The city’s schools are operating on a $12.6 billion budget in the current school year.

See Also
See a related story from this issue, “States on Ropes in Finance Lawsuits”

“When anybody takes a careful look at the needs in New York City . . . [they see] the need is monumental,” Michael A. Rebell, the CFE’s executive director, said at a news conference shortly after the panel released its report last week.

Mr. Rebell added that the panel also affirmed the group’s contention that the state should face large fines if it doesn’t comply with a judge’s order to increase spending within 90 days. He said those fines should be equal to the amount that would be due to the city schools under the order.

In the days before the panel released its report, Mr. Rebell negotiated with members of Gov. George E. Pataki’s staff over a settlement, but the parties were unable to reach an agreement.

While Mr. Rebell wouldn’t comment on the specifics of the talks, he said the sides neared an agreement over how to hold schools accountable for how they spend any new funding derived from the lawsuit.

Mr. Rebell said he planned to continue talks with the governor’s office. A spokesman for Gov. Pataki said he would “aggressively negotiate” for a settlement.

“We continue to believe a statewide solution is needed and that these decisions should not be left to the court, but should be made by elected representatives of the people,” Kevin Quinn, a spokesman for the Republican governor, said in a statement.

Last week’s report from the panel of so-called special referees was the latest victory for the Campaign for Fiscal Equity in its 11-year-old lawsuit to improve the financing of New York City schools.

Latest Victory

Now the New York City nonprofit group will appeal to Justice Leland DeGrasse to adopt the report. Justice DeGrasse is the trial-court judge who first ruled for the CFE in the case in 2001 and is now overseeing its final stages. The justice has not set a timetable for acting on the Nov. 30 report, but CFE lawyers said they expect he will rule on it soon, possibly as early as January.

In 2003, the New York Court of Appeals—the state’s highest court—said the state failed to provide enough money to provide New York City’s 1.1 million students the “sound, basic education” guaranteed under the state’s constitution. The court gave the state until July 30 this year to fix the problem. ("Court Orders New York City Funding Shift," July 9, 2003.)

When Gov. Pataki and the legislature failed to find a solution, Justice DeGrasse formed the panel of three distinguished jurists to suggest how he should respond.

The panel’s 57-page report recommends slightly more than the CFE requested, and more than double the $1.9 billion a year Gov. Pataki proposed for the city schools.

The governor’s proposal was artificially low because it was based on research with “flawed premises,” the three-member panel wrote. The biggest problem, the report said, was the assumption that New York City could improve student achievement by spending less than some of the highest-achieving districts in the state.

In addition, it accepted the CFE’s analysis that the city needs a $9.2 billion capital-improvement plan to provide adequate school facilities for its students, rejecting the state’s contention that its current capital-financing program would be enough to pay for the city’s infrastructure needs.

Those improvements would be made over five years, but would most likely be paid for with 30-year bonds, Mr. Rebell said.

While the panel stated how much the city schools need, it didn’t say whether the state should pay for all the new spending or whether the city should chip in.

Paying the Bill

New York City Mayor Michael R. Bloomberg said the city is facing a projected $3 billion deficit in fiscal 2006 and would be unable to provide major hikes for education.

Adding to the challenge, the state’s budget division is estimating the state’s $43 billion general fund will face a $5 billion shortfall in the next fiscal year.

Vol. 24, Issue 15, Page 20

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