Area schools are slated to collectively lose more than $2.9 million in foundation aid for the next school year if the state Legislature approves policy changes proposed in Gov. Kathy Hochul’s executive budget plan.

Saranac Lake Central School District and Lake Placid Central School District will see the largest foundation aid losses at $1,469,668 and $843,853, respectively, while Long Lake Central School District stands to see the largest proportional loss at $128,249, or 44.7%, of its foundation aid. Tupper Lake Central School District, Keene Central School and AuSable Valley Central School District will also see reductions in their foundation aid.

Created in 2006 following a court decision, foundation aid is the largest aid category that supports public schools across the state. Hochul proposed a $507 million increase in foundation aid for the 2024-25 school year. To fully fund the foundation aid formula, there would need to be a $927 million increase, which is in line with past years’ fully-funded increases of $1.5 billion for 2022-23 and $2.6 billion for 2023-24. With a more than $400 million difference in expectations, many school districts statewide would see no increase or even a decrease in foundation aid.

Hochul’s budget also proposes changes to the way that districts across the state calculate their foundation aid.

Foundation aid varies by district. It is calculated by taking into account factors like local cost of living, existing district funding and student needs and costs. Hochul’s foundation aid proposal has two tentpoles: Altering the formula that calculates foundation aid and eliminating the “save harmless” — sometimes called “hold harmless” — provision, which ensures that the total foundation aid a district receives is not smaller than the previous year’s total.

The new formula takes into account “transition adjustment,” which is calculated via a second formula. Transition adjustment is a wealth-based calculation. The elimination of the “save harmless” provision is a by-product of this formula change and not something that is legislated explicitly. The formula changes are located in Part A of the Education, Labor and Family Assistance Bill, which can be viewed at www.tinyurl.com/vx2vym4e.

These changes are part of Hochul’s executive budget plan, not the state’s enacted budget, which the Legislature must pass before April 1 and may be different than Hochul’s plan. A bipartisan group of local representatives have expressed their disapproval of the foundation aid changes and have promised to work toward fully funding foundation aid in the enacted budget. Until the state’s budget is passed, however, school districts must build their own budgets around the numbers in Hochul’s plan.

School budgets must be adopted by April 15.

–

Saranac Lake

–

Saranac Lake Central School District is anticipating a $1,469,668 hit to its foundation aid, a 19.4% drop from last year. At its meeting on Jan. 24, the school board held a preliminary discussion on the potential aid loss and how it may affect their budgeting process.

“We’re trying to budget and the sky is falling, then we come back in two weeks, the sky is falling a little less, then it’s falling a little less. But I also don’t want to just pooh-pooh what has happened with the governor’s budget,” said SLCSD Superintendent Diane Fox. “I refuse to be on fire this early in the process. It’s a long way to April if my hair’s on fire in the middle of January.”

SLCSD is one of the districts that will be affected by the elimination of the save harmless provision. In the past, though the student population has been shrinking, the district has never seen a loss of aid as a result. However, Fox told the school board that the district was already braced to start receiving smaller increases in aid than it was used to.

“(The foundation aid loss) was unexpected, but a lack of growth in foundation aid was not unexpected. Being at zero or 1% or 2% was what we expected. Do I think we’ll come in someplace close to that? Probably,” Fox said.

SLCSD School Business Executive Cindy Moodywrote in an email that the district will not exceed the 2% tax levy cap to make up for lost aid.

Fox said that the fact that the losses are statewide is a reason to have hope they’ll be reversed by the Legislature.

“This is the governor’s proposal, and then there’s always a lot of back-and-forth, back-and-forth, back-and-forth before the actual budget comes out. It’s nice to hear so many members of the Legislature who are panning this idea,” she said. “When it’s only a North Country issue there’s a good change it’ll stay because the movers and players don’t care, but this is an everywhere issue, so movers and shakers in the government do care.”

–

Tupper Lake

–

The Tupper Lake Central School District Board of Education met on Feb. 5 to discuss the 2024-25 budget process in the wake of potential foundation aid losses.

“We have, as a district, remarkably few ways that we can generate revenue,” outgoing Superintendent Russ Bartlett said.

Tupper Lake Central School District stands to lose $126,751 in foundation aid, a 1.7% decrease from last year, under Hochul’s proposal. This comes at the same time that federal pandemic-era education funding through the U.S. Department of Education’s Education Stabilization Fund, totaling $19.5 billion in New York state, is coming to an end. Tupper has received $2.6 million in ESF funding, according to the ESF transparency portal. At the meeting, Bartlett said the district stands to lose around $1 million in ESF funding. Bartlett called this a “fiscal cliff,” the biggest hit to the budget this year. But it’s nothing new.

“This loss of a million dollars isn’t new to us,” he said. “I kind of thought maybe once before the end I’d be able to come here in February and go, ‘we’re flush, we’ve got loads of money,’ but apparently this year is not it either.”

The district’s Boards of Cooperative Educational Services funding will see a 15.2% increase from last year, or $225,228 more, bringing the total this year to $1,704,634. BOCES funding is expense-driven, meaning the more a district spends with BOCES, the more revenue or aid the district will generate. The state has not proposed any changes to BOCES aid.

TLCSD will also receive $243,910 in universal pre-K funding, which is separate from the budget and goes to the district’s special aid fund.

Bartlett said that BOCES is the district’s best way to generate revenue, as they can use BOCES funding to pay for things they need, in turn generating more BOCES aid.

“It’s pretty much one of a very small list of things that we can do to generate any kind of revenue,” he said.

TLCSD’s budget talks began much earlier than usual, starting in November 2023, in an effort to brace for the potential losses. According to business manager Jessica Rivers, talks from now through March will be more aggressive, with a draft budget due at the March 11 board meeting.

–

Lake Placid

–

LPCSD is anticipating one of the largest proportional foundation aid losses in the Tri-Lakes. With $843,853 of its foundation aid on the chopping block — a 41.7% decrease — the school board and administration are approaching the budgeting process as if the aid loss will happen.

“Right now, we’re building a budget,” said LPCSD Assistant Superintendent for Business, Finance and Support Services Dana Wood. “What we’re doing is, we’re going off of this current proposal, so I’m using these numbers to work off of. We’re going to be using a lot of additional revenue in interest.”

At a Jan. 23 meeting, the school board discussed a foundation aid loss of $617,000, a number that Wood later said was an inaccurate representation presented by the state. That number offset the anticipated foundation aid losses by applying the full total of a grant the district would never receive.

“We have a grant for our universal pre-K, and up until last year, our grant amount wouldn’t exceed $405,000. And then, for this coming year, that year it’s jumping up to $631,800,” he said. “So, it makes it look like, on paper, that we’re actually getting over $200,000 more in aid. But, in reality, that aid is based off of actual enrollment. … In order for us to get the full $600,000, we’d need to have more than 63 pre-K students. We have not ever exceeded the allotments.”

Wood said that the district would be tapping into additional revenue gained from interest to fund its budget for the next school year.

The district accepted an audit by New York state Comptroller Thomas DiNapoli in November that reported district officials failed to “develop and manage a comprehensive investment program” and said that, had they done so, the district might have earned about $267,000 more during the two-year audit period.

In the district’s written response to the audit, Wood said that he would solicit quotes on a yearly basis and authorized the transfer of more than $10 million out of the district’s insured cash suite and into NYCLASS, which is a higher-yield, short-term liquid investment fund.

LPCSD Superintendent Timothy Seymour said that, though the district’s budget will be built on Hochul’s numbers, he remained optimistic.

“We are hopeful that the Legislature can amend the governor’s proposal in a more thoughtful and equitable manner,” he said.

–

Keene

–

Keene Central School District is set to lose $158,504 of its foundation aid, a 32.6% decrease. The district is “in the early stages” of finalizing its budget, according to district Superintendent Dan Mayberry.

“At this point, we don’t have final numbers on health insurance increases and some of that stuff,” he said. “The final number is hard to tell.”

Mayberry said that the loss would require a 2.4% increase in the tax levy just to offset that cut, and that’s before the district figures in other potential spending increases.

“To start the budget process with that kind of increase, that already exceeds our allowed tax levy cap percentage,” he said. “(That’s) not ideal in any way, shape or form.”

KCSD exceeded the tax levy cap set by the last year, increasing its tax levy by 6.8%.

While other schools like LPCSD may turn to interest revenue to offset the blow of the foundation aid loss, KCSD has even more limited resources.

“If we have any fund balance left over, we’ll be using some of that to help soften the blow,” Mayberry said. “In a district as small as ours, there’s not many places where you can cut your way to savings.”

–

AuSable Valley

–

AuSable Valley Central School District is set for a 1.3% decrease in foundation aid at $179,020. Combined with an anticipated loss of federal aid, though, this will impact the district’s budgeting and programming, according to district Superintendent Michael Francia.

“Like most North Country schools here, we’re aid-dependent, heavily aid-dependent, and whenever there’s a cut in aid it affects what we can do,” he said. “Most of our schools have lost their (American Rescue Plan) money as well. … We have to take a real good look at what programming we’re offering. We’re going to have to be creative with how we staff that.”

Francia said the district is set to lose $736,595 in ARP Elementary and Secondary School Emergency Relief funding. ARP ESSER was signed into law in March 2021 to help schools continue operating during the coronavirus pandemic and transition back to in-person schooling.

“With the loss of that $736,000, you’re looking at your net revenue being $340,000,” Francia said. “But the cost of everything has gone up so much, that doesn’t come close to covering the increase in expenses that we’re estimating.”

He added that, as of now, the budget does not look like it’ll exceed the tax levy cap. However, the school board has some tough decisions on its horizon as it tries to mold operations to fit the ever-reducing budget.

“More money is going out than you have coming in, and it leaves us with some tough decisions,” Francia said. “We’re constantly in a cycle of having to cut … in order to have a balanced budget.”

–

Long Lake

–

For the 2023-24 school year, Long Lake Central School District received $286,998 in foundation aid, all but $35,000 of which was save harmless-protected funding. Now, with that protection in jeopardy, LLCSD stands to lose $128,249 in foundation aid for the 2024-25 school year, a 44.7% decrease from the current school year.

“We’re going to have to make some difficult decisions,” said Interim Superintendent and Principal David Snide. “For right now we’re planning two budgets.”

For the 2023-24 school year, LLCSD total aid came to $625,179. Aid is projected at $473,888 for the coming year.

Changes will include tightening the school district’s already tight belt and reaching out for more grants. Snide said that LLCSD has always been very fiscally responsible, but will have to find a way to be even more so now, faced with this new problem.

“If (the governor) think(s) we’re sitting up here fat and happy, I would love to have them come up to explain to us where we can be more fiscally responsible,” he said.

Budgeting, Snide explained, is not done one year at a time. Instead, school boards try to look out years in advance. With the governor’s proposed changes, that’s becoming less realistic.

“It’s really difficult to be able to do that (now),” he said.

Many small school districts are already stretched thin, in funding and staffing, and Long Lake is no exception. Every teaching position at the elementary and middle-high schools is combined, meaning each teacher teaches two grades.

“Our teachers are awesome,” he said.

Part of the formula for determining aid is the combined wealth ratio, which averages a district’s property and income wealth. Snide said this hurts the schools, because Long Lake has high property wealth but low income wealth. He reported that the number of reduced school lunches — which are no cost to students from families whose annual household income falls between $39,00 and $55,500 for a family of four — are on the rise in the district.

“The fact is we do not have a lot of reserves,” Snide said.

Snide added that the community is hugely supportive of the schools, and that the school board is working diligently to make the potential losses work.

“We will be able to still offer not only a quality education, but improve our education,” he said. “That’s what we’re all about.”