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In Chancellor’s Proposal, Dollars Follow Students
Funding makeover proposed

By Charlotte Eichna

Schools Chancellor Joel Klein unveiled details last week about his plan for revamping school funding formulas, a proposal that worried some advocates for schools in wealthier neighborhoods across the city.

The press briefing was followed days later by an announcement that Gov. Eliot Spitzer (D) would significantly boost state education spending.

Under the city’s new strategy, students—not schools—would be the major drivers of city education dollars. Each student would get a basic amount of money under the Chancellor’s plan, with additional funds being added depending on language proficiency, income, grade level and academic achievement, among other factors. In the 2008-09 school year officials may also factor in to funding formulas gifted status and whether a student has entered the country with little formal education. The mayor first announced the plan in his annual State of the City address.

The proposal is meant to replace a system that has been described as overly complex and based on allocations made years ago. Ninety different funding streams currently flow into schools, according to the Department of Education, each with its own rules and formulas dictating the funds a school receives and how principals can spend that money. As a result, schools with similar student populations may receive vastly different amounts of money, with gaps sometimes as great as $1 million, according to the department.

In one example comparing two schools with relatively similar demographics, the department found a funding gap of more than $2,000 per student.

“I think it’s important to the city that we can say that we’re being equitable, we’re being transparent, and we’re treating kids who are in a similar situation the same,” Klein said. “I think that’s the basic and fundamental principle.”

The chancellor did not name any specific schools or districts in the press briefing. But he stressed that in examining current funding formulas, education officials found that levels varied widely and did not generally correlate with indicators like poverty level, borough, grade or other demographics.

“There are striking variations in schools funding formulas,” he said. “They cut across all of these distinctions.”

The funding proposal would only affect city tax dollars and unrestricted state money, or about two-thirds of each school’s budget. Remaining education dollars are earmarked from specific state or federal programs.

City schools will also get an infusion of dollars from the state. In a Jan. 29 speech outlining his education agenda, Spitzer promised that his upcoming budget would include “the first significant increase” in funds for the State Department of Education in more than a decade, tied to strict accountability requirements. At press time, the governor had not yet release exact numbers, but New York City is likely to get at least $3 billion more from the state over the next four years, according to published accounts.

In line with the city’s funding initiative, Spitzer also criticized the state’s school-aid formulas as “Byzantine and politically-driven” and proposed a more streamlined system.

Klein also proposed changing the way schools pay for teachers. For the most part, schools are now charged the average salary for each teacher, regardless of that person’s actual salary. That means many high-poverty schools where inexperienced, low-paid teachers tend to cluster assessed more for their instructors than they actually cost, eating up school budget money that could be spent elsewhere.

Under the new plan, schools would pay for teachers according to their actual salaries. Education officials say this would free up money at high-poverty schools, and would also provide principals with a more accurate portrait of a school’s budget so they can make more informed spending decisions.

To minimize disruption at schools where there are a lot of senior teachers—presumably in many of the city’s well-off neighborhoods—schools will be allowed to continue paying average salaries for teachers already on budget. But going forward, budgets will have to reflect the true cost of any new hires.

Council Member Jessica Lappin (D-Manhattan), who attended a Council hearing on the funding proposal, said she was “very concerned” about the proposed changes.

“Everybody agrees you want be making sure that children who are facing additional challenges and barriers to success need more resources,” she said. “At the same time, you don’t want to take money away from schools that are working well.”

Lappin said education officials have never fully explained current funding formulas, other than saying they are should be simplified and made fairer.

She agreed, however, with some of the department’s underlying goals: creating a budget that principals can view all on one page, giving more money to students who need additional resources, and simplifying the budget process.

City Council Member Gale Brewer (D-Manhattan), whose district, like Lappin’s, includes several better-funded schools, also voiced concern.

“Yes, there should be equity, but all schools should be brought up to an adequate standard and not cut,” she said.

Brewer also questioned why the department never fully explained the current funding system, and why no attempt was made to investigate the logic behind current funding differences. “There might be a reason why one schools gets more money than another school,” she said.

Education officials hope to gather input on their proposal over the next month and invited New Yorkers to visit the department’s website,, and to email questions to fairstudentfunding@schools.nyc.gov. Members of the Panel for Education Policy, which must approve the changes before they can be implemented, will be briefed individually and in public forums over the next few months.