N.Y. Finance Suit At Last Headed For Resolution

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Albany, N.Y.--New York's 57-year-old system of financing public education made what may turn out to be its last stand in a hearing last week before the New York Court of Appeals, this state's highest court.

Twenty-six suburban and rural school districts and four cities which have prevailed in three lower courts over the last eight years claimed that the current system creates a "double standard" of public education. The plaintiffs, led by the Levittown school district on Long Island, want the current financing system thrown out and replaced with a more equitable plan.

Systems Offers a 'Warm, Dry Bed'

Attorneys for the state, however, argued that the current system is fair, that it offers a "warm, dry bed" for all schoolchildren, and that no alternative could make things better.

Because of the impact their decision would have on the state's 712 school districts, the seven judges on the appeals panel extended arguments in the case to three hours, instead of adhering to the normal one-hour limit, and cleared their daily calendar to make it their only case.

At issue in the suit, Levittown v. Nyquist, is whether the state's system of financing education through a combination of state aid and local property taxes is unconstitutional, because districts which have a large tax base can offer more extensive programs while imposing lower property taxes than districts that are low in property wealth.

The Levittown suit has been closely watched by school-finance experts all over the country and is widely considered one of the two or three most important finance-reform cases ever filed against a state.

One reason is that New York's state courts, like California's, are highly visible and may influence the thinking of state judges elsewhere, although their decisions have no official precedential value in other states.

Another is that the plaintiffs in Levittown introduced two concepts that have since been copied by school-finance reformers elsewhere.

One is the notion that poor school districts--rather than individual students and taxpayers--might join forces to mount a legal challenge to a finance system.

The other is the theory of "municipal overburden," which holds that big cities, because of their large concentrations of elderly and low-income residents, are obligated to provide high levels of expensive public services.

Because of this "municipal overburden," the four large cities that are parties to the suit claim they are less capable of paying for schools than their property values would suggest, and thus need more state aid.

Three lower state courts have ruled that the state's school-finance system, by allowing per-pupil expenditures to become largely a function of local property wealth, violates the state constitution's equal-protection and education clauses, as well as the 14th Amendment to the U.S. Constitution.

Daniel Levitt, attorney for the suburban districts, said the disparities have been made worse by "a hodgepodge of schemes" and by certain state-aid formulas that do not take districts' needs into account. Under the state's "flat-grant" program, for example, each district receives a fixed amount per pupil no matter how much property wealth it has. And a "save-harmless" provision ensures that districts will receive at least as much state aid as in previous years, regardless of declines in enrollment.

'Educational Triage'

"Property-rich districts have inevitably enjoyed the luxury of fashioning educational policies of their own liking ... thanks to abundant resources ... [and] legislative largess." Poor districts, he added, ''have been reduced to a kind of educational triage--a desperate annual determination of which programs to cut, which teachers and staff to let go, and which necessary tools to do without."

Amy Juviler, assistant attorney general, said that the state legislature, which is responsible for distributing $4.2 billion in school aid annually, already provides extra money for low-wealth districts. "There's not been one iota of evidence provided in court to date that another system will make things better," she argued.

For the state to bring poorer districts to parity with the wealthiest, Ms. Juviler said, would cost $8 billion in additional state aid--money the state does not have. (Others have estimated the cost of equalization at $1 billion to $7 billion per year.)

With the local tax contribution of $6 billion, New York spends more per pupil on public education than all but two states and is $1,000 per pupil ahead of California. "New York provides a warm, dry bed for all school districts," Ms. Juviler said.

"What you're saying is that some can have a canopy over the bed and some cannot?" asked Judge Sol Wachtler.

John Silard, an attorney representing the four large cities that joined the suit as plaintiffs, angrily denied her claims: "In Buffalo, our schools are without kindergartens. That's not a warm bed. In Buffalo, we have elementary schools without libraries. That's no warm bed. That's no bed at all."

Claiming that the public-school system was created to help the poor, Mr. Silard said: "Now we have a double standard--one for public education for the rich, and a lower standard for the poor."

The suit, originally filed in 1974, was brought by 26 suburban and rural school districts--including 13 from Long Island--seeking a fairer method of funding public education. They were later joined by the cities of New York, Syracuse, Rochester, and Buffalo.

After a nine-month trial that produced 22,400 pages of testimony, State Supreme Court Justice L. Kingsley Smith in 1978 ordered the state legislature to devise a more equitable school-finance system, but set no deadline. The appellate division last October upheld Judge Smith's ruling.

Large-Scale Changes

In February, Gov. Hugh L. Carey, who is not seeking re-election, proposed large-scale changes in the school-aid system to be funded by a one-cent increase in the state sales tax. Under Governor Carey's plan, several wealthy school districts would have lost all general aid from the state. The proposal was killed by legislative leaders who did not want to cut off the wealthy districts' state aid or raise taxes in an election year.

A decision in the case is expected sometime in June or July, according to court sources. If the court upholds the lower-court rulings, it could force the state legislature to meet in special sessions to devise a more equitable plan to fund the public schools.

Vol. 01, Issue 34

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