1. School Spending – Where it Goes 1 Source: Council analysis of NYSED 2005-06 School District Fiscal Profiles; NYC excluded NYS school districts excluding NYC 71% of spending is for personnel: –52% salaries –19% benefits

2. Employee benefit cost increases exceeded state aid increases between 2002-03 and 2005-06 2 Source: Council analysis of NYSED School District Fiscal Profiles; NYC excluded Pension costs have stabilized in more recent years, but what happens when current market downturn is factored into contribution rates?

3. Special education (for students with disabilities) is a major cost-driver 3 New York has the 2 nd most costly special education system in the country. We can’t really blame the Feds: – SED’s own analysis of NYS policies which exceed Federal requirements is 30+ pages long. If NYS were to reduce spending simply to the national average it would save $1.3 billion per year.. Our results don’t justify this spending, and all these regulations aren’t working: our special education graduation rate is below the national average. Yet last year, Lawmakers and the Governor enacted 2 costly new mandates.

4. Superintendents’ targets for cost savings (informal survey results) 4 Local ActionState Help Desired Energy conservation (e.g., cut back on transportation, building improvements) Special education (e.g., pare back to US regulations) Health insurance (e.g., increase employee contributions, join consortia) Health insurance (e.g., state or regional plans). Staff reductions General mandate relief/no new mandates. Non-personnel (e.g., freeze) Personnel (e.g., Triborough, regional bargaining; streamline discipline/removal) Other personnel (e.g., smaller negotiated salary increases, cut professional development) Pensions (e.g., employee contributions past 10 years, other). Greater use of BOCES, other shared services. Transportation law amendments

5. Other Cost Savings? 5 School Consolidation: – Revenue: Schools as tax shelters. 68 districts have more than $1 million per pupil in property wealth; 23 of those districts have fewer than 350 pupils, most have less than 1500; If they were all to tax at the state average property tax rate, they would generate $1.8 billion in additional revenue. – Expenditures: Is the juice worth the squeeze? Of the 194 districts <1000 kids, 145 are below average wealth, 2/3rds already spend below the state average. Even if they could all save 5%, this would amount to just $78 million statewide. Universal Health Insurance Plans? Co-location of social/health services. Intergovernmental collaboration.