The late state budget is threatening to create challenges for schools, which are trying to finalize their own budgets that need voter approval.

Gov. Kathy Hochul indicated last week that plans were being made as part of a budget deal to ensure the Foundation Aid formula is updated by the passage of next year’s budget. That is expected to mean that the full impact of her initial plan to eliminate hold harmless, which ensures that districts don’t receive less Foundation Aid than the previous year, won’t be felt this year.

Brian Fessler, director of governmental relations for the New York State School Boards Association, told Spectrum News 1 that districts spent the better part of the first three months of the year concerned about that proposal to eliminate hold harmless, and how it would impact them.

Now, with the budget late and that plan seemingly at least partially on hold, schools are still in the dark as they close in on their own budget deadlines.

“A state budget that is later than the end of next week causes districts to have to make decisions without knowing what their final school aid numbers are going to be,” he said. “School districts have to develop that budget proposal, and they have to follow certain timelines set in state law as part of that process.”

That includes a property tax report card due at the end of April, plus budget information and ballots that must be sent out in advance of budget and school board elections on May 21. That’s tough to do, he said, if districts fear a major change in aid.

“Just these little tweaks up and down here or there can have a meaningful impact,” Fessler said.

Other budgets have certainly been late. Plus, since 2007, school funding fluctuated as Foundation Aid was fully implemented, and battles ensued over school aid prior to full funding of the formula in last year’s state budget, leaving a degree of financial uncertainty year over year.

That said, Fessler argues that 2010, when budget negotiations stretched into August, was the last time a late budget actually coincided with major challenges for school budgets.

On Tuesday, Senate Majority Leader Andrea Stewart-Cousins seemed to confirm Hochul’s comments last week, indicating that districts could at least anticipate hold harmless remaining in place while changes to the formula are ironed out in the coming months. Both the state Senate and Assembly rejected the proposal in the budget rebuttals. 

“Mitigating the pain that half of the school districts in this state was going to experience,” she said.

Those with a stake in the school budgeting process are not breathing a sign of relief just yet, though, as sources close to state budget negotiations say details are still being ironed out when it comes to the governor’s other Foundation Aid proposal. It would set the Foundation Aid inflation factor at 2.4%, representing the average annual change in the Consumer Price Index over the past 10 years with the highest and the lowest years dropped.

While it remains to be seen where that proposal will land – and sources suggested Wednesday that its impact too could be blunted – Rick Timbs, executive director of the Statewide School Finance Consortium, came out swinging Wednesday.

He criticized the disconnect between the calculation and actual inflation rates.

“Taking the last 10 years and taking out the highest and the lowest, why would a district care what the CPI was in 2013, 14, 16, 17, 18? It’s irrelevant,” he said.

The governor and others have cited declining enrollment and outdated population figures as a key problem with the Foundation Aid formula, and Hochul has continued to express the importance of modernizing the formula to reflect current population figures, even if eliminating hold harmless is presumably off the table.

Hochul told reporters last week that plans for exactly how that will work, or what, if any, changes may still be made this year when it comes to the inflation factor, had yet to be determined. Her office pointed us to those remarks when asked for an update on Wednesday afternoon.

“For years, people knew we had a formula that was outdated, based on populations back in 2008,” she said. “No one had the guts to say the emperor has no clothes, something is not working here. I came up and said, 'why is it that these districts have lost population...we’re paying for empty seats.'”

With the full nature of any review of the formula that may be included in the final enacted budget unknown, Timbs is calling on lawmakers to ensure that any changes to the formula also take into account the evolving role of schools in New York state.

“Yes, we’ve lost enrollment but our mission is so much bigger. In some school districts, we’re becoming surrogate parents. We have health care offices, mental health professionals, social work,” he said.

He also stressed the importance of the state Department of Education playing a leading role in updating the formula.

“I don’t want my garage mechanic explaining to my pilot on my trip to Europe how to fly,” he said.