Judge Orders $7.4 Billion More for NYC Schools

Published April 1, 2005

State Supreme Court Justice Leland DeGrasse of Manhattan has ordered New York state to ensure that within four years the New York City school system has another $7.4 billion a year to spend on top of the $12.9 billion a year the system already consumes.

Officials in the administration of Gov. George Pataki (R) immediately said the state will appeal the decision. That sets the stage for months or even a year of additional court action as the case works its way back up to the Court of Appeals, the state’s highest.

2003 Decision Upheld

The Court of Appeals ruled in July 2003 that the state must ensure the city’s schools get more money, but the court did not put a dollar figure on its ruling. DeGrasse’s ruling, issued after 18 months of political gridlock on the issue, represents the first judicial attempt to tie a specific amount of money to the case.

DeGrasse rejected New York City Mayor Michael Bloomberg’s (R) attempt to get him to rule that the state itself must pay the entire extra amount. The judge noted the Court of Appeals had already explicitly stated it was for the legislature to decide how much of the new money for the schools must come from the state, and how much from the city.

Pataki has suggested the state might pay 40 percent of any new aid to the city’s schools. Assembly Democrats have said the figure should be closer to 75 percent. Either way, if upheld, the ruling would probably mean a minimum of another $1 billion of state spending in the state fiscal year that began April 1, ballooning to at least $3 billion a year more by 2009.

Judge Raises Ante

Reviewing proposals from various parties to the case, DeGrasse picked the highest dollar amount on the table–slightly higher even than the plaintiffs, the Campaign for Fiscal Equity (CFE), had recommended.

DeGrasse also stood with a three-judge panel that had reviewed the case for him and rejected any new accountability measures, even a proposal from CFE itself that the city have a detailed plan for how it will spend the money.

Like the Court of Appeals ruling before it, DeGrasse’s ruling applies only to New York City schools. CFE and various allies, including the New York State School Boards Association, want the legislature to extend the principles used to calculate the extra New York City spending to schools statewide, at an additional cost of about $3.2 billion a year.

The judge said the state should ensure the city’s schools get $5.6 billion a year in additional operating spending, phased in over the next four school years. That would raise per-pupil spending in the city’s schools to $16,800 a year. That is double the national average and works out to $336,000 for each hypothetical 20-student classroom.

In addition, the schools need $9.2 billion over the next five years, or $1.84 billion a year, in capital spending to add new classrooms and otherwise upgrade facilities, DeGrasse ruled.

Under the Court of Appeals ruling, the legislature could decide the state will pay the entire extra amount itself. Or it could require that the city contribute some of it. One way or the other, however, the high court said it is the state’s responsibility to ensure the new money arrives.

Fairness Not the Issue

Although supporters of the increase describe the lawsuit as being about “fair” or “equitable” funding for the New York City schools, it is not. The Court of Appeals has ruled three times that there is no constitutional right to equitable school spending.

What the court did say, however, is that the state constitution entitles students to “an opportunity for a sound basic education.” In other words, the issue is how much spending is adequate, not what is “fair.”

In its defense, the state had contended New York City itself was underfunding its schools. But the high court held the city is a creation of the state, and the state is thus ultimately responsible for the condition of the city’s schools.

If the city has underfunded its schools, the court said, then the state should not have allowed that to happen.

Objective Analysis Ordered

In its July 2003 ruling, the Court of Appeals ordered the state to determine objectively just what is the cost of providing a sound basic education in New York City. It gave the state until July of last year to come up with a plan for putting the money in place.

Pataki appointed a special commission to work on the cost-determination issue, among others, and CFE conducted its own “costing out” study.

But when the legislature gridlocked over the issue and the deadline passed without action, CFE went back to DeGrasse seeking a new order demanding a specific amount of money and a specific timetable. Unless the state and CFE reach an out-of-court settlement in the meantime, that order will now go back up the chain of appeals.

David S. Shaffer ([email protected]) is president of the Public Policy Institute of New York State and served on the Zarb Commission, which was appointed by New York Gov. George Pataki to recommend funding options for New York City schools.

For more information …

The Web site of the Campaign for Fiscal Equity contains all of the court documents and rulings regarding the lawsuit. http://www.cfequity.org