Assemblywoman Barbara M. Clark (D-Queens) today called for the State to finally act on the Campaign for Fiscal Equity v. New York State court order. In March 2005, the New York State Supreme Court ordered New York State to provide New York City public schools increased aid totaling $5.6 billion over four years for operating expenses and $9.2 billion for capital improvements. This was the result of a groundbreaking lawsuit launched by the Campaign for Fiscal Equity in 1993.
In his 2006-2007 Executive Budget, Governor Pataki has once again chosen to ignore the court order and instead seeks to expand the School Tax Relief (STAR) program by increasing the exemption for income-qualifying seniors and adding a $400 property tax rebate for homeowners in districts OUTSIDE of New York City that meet certain spending caps. The Governor also proposed a $500 education tax credit which would work like a voucher for families in academically under-performing districts. While these measures do provide some relief from high property taxes and result in increased school aid to some districts, many districts with the least need will receive the greater portion of the benefit.
On January 23, 2006, Mayor Bloomberg made a trip to Albany to protest the severely deficient allocations to New York City Schools, noting that the additional $530 million in relief totally excludes New York City. Even in districts outside of New York City, STAR Plus is an empty promise since meeting spending caps is extremely difficult. According to a recent study by the Fiscal Policy Institute, the cost of providing a Sound Basic Education is rising beyond inflation in many districts. Asking school districts to choose between STAR Plus relief and increasing school budgets presents them with a Hobbesian choice – neither choice is adequate.
In addition, the study found that STAR does not effectively target need due to price differentials, as the rate of relief is higher in districts with higher property values. For example, the median state exemption is $30,000, while it is prorated in Westchester County to $86,500. By not taking income (i.e. ability to pay) into consideration, homeowners across the state with similar incomes and property tax bills receive different benefits based on where their homes are located. Presently, the largest payout for STAR goes to two of the richest counties in the nation—Westchester and Nassau.
There is also evidence that the current STAR Program does not help to reduce tax burdens. In an October 2005 study, the Center for Policy Research at Syracuse University’s Maxwell School of Public Affairs found that the basic STAR program actually increases school spending and property tax rates by encouraging districts to add unnecessary bells and whistles with the State picking up the cost at the expense of high-need districts that do not benefit as much from STAR.
Assemblywoman Clark opposes expansion of the STAR program because it constitutes the largest chunk of the $4 billion increase in the 2006-2007 state budget. This proposal clearly deviates from New York State’s responsibility to adequately fund New York City public schools. Joining Assembly Speaker Silver, she believes immediate action is necessary to prevent another generation of children from being left behind. As a firm believer in the importance of education in strengthening our communities, she supports the CFE mandate and urges the Governor to pledge state aid to all school districts according to their needs.