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From LI school leaders, a cautious assessment of $1.9T relief package

Malverne schools Superintendent Lorna Lewis.

Malverne schools Superintendent Lorna Lewis. Credit: Raychel Brightman

Long Island school leaders say they have good reason to be cautious in assessing the impact on their districts of President Joe Biden's financial rescue package — a plan representing a historic windfall for many schools nationwide.

One question that remains is exactly how federal money for schools will be distributed in Nassau and Suffolk counties, local leaders point out. Another question is whether New York State and its school districts will be able to pick up the slack two or three years down the line, when relief money runs out.

Overall, the $1.9 trillion rescue plan, which the president signed Thursday, provides nearly $122 billion for K-12 schooling nationwide, with nearly $9 billion set aside for New York State schools. The funding is widely described as the biggest single federal investment in public education in history.

"It sounds great," said Lorna Lewis, superintendent of Malverne schools and a past president of the New York State Council of School Superintendents. "But we don't know how that will impact us until we see the actual dollars. Those dollars are going to dry up, and then we're left with a deficit that we can't easily fill."

Clues to how federal funding could be divided up statewide appeared in Gov. Andrew M. Cuomo's proposed budget, which was released Jan. 19. The plan included a tentative school-aid increase of more than 7% for the 2021-22 fiscal year.

A closer look at the details revealed, however, that the Island's districts would get increases averaging just over 1%, and that 50 districts on Long Island would see cuts. Meanwhile, New York City schools would get an increase of more than 13%, Rochester more than 12%, and Buffalo more than 10%.

Why the disparities? Cuomo's plan relied heavily on a $3.8 billion infusion of federal money from an earlier relief package. And under federal rules, that money was to be concentrated on impoverished schoolchildren, most of whom live in urban neighborhoods.

Now, with the signing of Biden's latest plan, more federal money is being added to New York State's revenues. And once again, the bulk of federal school funding will be distributed according to the formula focused on high-poverty urban districts.

Just how much money will be available for Nassau-Suffolk schools and those in other suburban regions may not be known until April 1, when Cuomo and state legislators work out final aid allotments for 2021-22.

As for the question of what happens when federal funding runs out: Local school administrators interviewed in recent weeks have frequently voiced anxiety over the issue, typically described as "falling off a fiscal cliff."

It's happened before.

In 2011, districts across the Island lost more than $110 million in aid money, after federal support dried up in the wake of the Great Recession. Consequently, those systems announced layoffs of more than 2,000 employees, including 1,200 teachers.

With that in mind, school representatives say it's time for the state and districts to find ways of setting money aside to prepare for potential lean years ahead. The Biden plan provides some flexibility in this area by allowing the spending of relief funds to be extended through the 2023-24 school year.

"There's a tremendous amount of cash involved here," said Bob Dillon, superintendent of the regional Nassau BOCES school system. "If you're going to adopt good financial planning, you need to expand reserves."

One proposal aimed at accomplishing this has been put forward by the New York State Council of School Superintendents, an advocacy group based in Albany. The plan would double the amount of unrestricted reserves, commonly known as "rainy day funds," that districts can bank for the future.

That would raise the reserves limit from the current equivalent of 4% of district revenues to 8%. Under the council's proposal, authority for expanded reserves would expire after five years.

Council representatives note that the Chicago-based Government Finance Officers Association, a research group, recommends that government agencies keep on hand unrestricted reserves equaling 16% to 17% of operating revenues.

Spreading out the use of federal funds, rather than spending them all in one year, makes financial sense, said Robert Lowry, deputy director for the council.

"The faster the money is used up, the steeper the cliff," he said.

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