Meeting of the Board of Regents | May 2008

	THE STATE EDUCATION DEPARTMENT / THE UNIVERSITY OF THE STATE OF NEW YORK / ALBANY, NY 12234
TO:
FROM:		Theresa E. Savo
SUBJECT:		2008-2009 State Budget
DATE:		May 8, 2008
STRATEGIC GOAL:		Goal 5
AUTHORIZATION(S):

 

Executive Summary

 

 

Issue for Discussion

 

Update on the 2008-2009 State budget.

 

Reason(s) for Consideration

 

Update the Board of Regents on the impact of the 2008-2009 enacted State budget and subsequent spending reductions.

 

Proposed Handling

 

Information for review and discussion.

 

Procedural History

 

In early April the 2008-2009 New York State budget was enacted.  Summary information was presented and discussed at the April Regents meeting.  The Regents requested additional information on certain aspects of the enacted budget.  In response, an overview of key provisions of State Aid to Schools and various Aid to Localities programs will be discussed at this month’s Subcommittee on State Aid and the EMSC Committee respectively.  Attachment 1 summarizes the Department-wide highlights of the 2008-2009 enacted budget by program area.

             

              Subsequent to the April Board meeting on April 21, 2008, Governor Paterson announced a Statewide 3.35 percent State Operations spending reduction for all General Fund and Special Revenue-Other accounts.  By May 16, 2008, the Department must submit a detailed 2008–2009 Financial Management Plan to the Division of the Budget, identifying how we will realize the required 3.35 percent savings.  Governor Paterson has indicated that the reductions “…must be achievable, recurring, and serious [and]…must reflect the creativity needed to provide the services the public expects at a lower cost.”  The Department is on sound financial footing and that will enable us to achieve our share of the savings target.  A preliminary review of the impact of the 3.35 percent reduction and the related spending controls is provided in Attachment 2.

 

Recommendation

 

N/A

 

Timetable for Implementation

 

              N/A

 

 

Attachments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STATE OPERATIONS - AID TO LOCALITIES - CAPITAL PROJECTS

 

CULTURAL EDUCATION

State Operations

• A $15 million sweep of funds from the Cultural Education Account earmarked for enhancing the public display of the collections of the State Museum, Library and Archives replaced, dollar for dollar, with bonded Capital construction funds (the remaining $5 million of the $20 million funding for NYS Museum renewal remains in the Cultural Education Account).
• Statutory language to allow the Department of Environmental Conservation to administer the Biodiversity Research Institute program, notwithstanding New York State Education Law.
• Authorization for the Department to increase fees for the New York State Archives’ records management services to State agencies effective April 1, 2009.

 

The enacted budget also:

 

• Amends the Cultural Education Trust language authorizing the Chancellor (rather than the Commissioner) to appoint the Board of Regents member to the Trust.
• Increases the following annual transfers from the Cultural Education account:

• Empire State Plaza Performing Arts Center:  $650,000 (an annual increase of $16,000).
• NYS Theater Institute:  $3.3 million (an annual increase of $1.1 million).

 

Aid to Localities

The enacted budget reduces funding by 2 percent for the following General Fund program:

• Aid to Public Libraries (a reduction of $1.93 million for a total of $100.3 million).

 

Capital Projects

 

The enacted budget includes the following Capital Projects:

• $2.25 million - Alternate emergency exit in the Cultural Education Center.
• $2.5 million – Upgrade of the fire safety system and environmental controls and renovation of the restrooms in the Cultural Education Center.
• $15 million – Enhancing the public display of the collections of the State Museum, Library and Archives (this funding offsets a corresponding reduction in Cultural Education Account revenue previously earmarked for the NYS Museum renewal).
• $4.3 million – Preservation and stewardship of the collections in the Cultural Education Center.
• $12.6 million – New Cultural Education records storage facility.
• $14 million – Local Library Construction.

 

OFFICE OF EDUCATION - P-16

State Operations

• Continuation of the $15 million General Fund appropriation for accountability activities, including the development of performance metrics and school standards of excellence.
• Restoration of the 50 percent reduction ($500,000) in funding for the administration of criminal history checks plus an additional $600,000 in funding for the Office of School Personnel Review and Accountability (OSPRA) for a total of $1.6 million.
• $250,000 of the EMSC General Fund appropriation is earmarked for the leadership development initiative.
• Elimination of General Fund appropriations earmarked for the development of the New York State Testing and Accountability Reporting Tool (NYSTART) ($683,000) to be replaced, dollar for dollar, with Office for Technology funds derived from bond sale revenues.
• Student Lending, Accountability, Transparency and Enforcement Act (SLATE) appropriation authority totaling $2.2 million (no source of revenue was provided, however).

 

The enacted budget also:

 

• Establishes that teacher tenure determinations shall not be based on student performance data.
• Amends statute so that teacher tenure determinations will only affect teachers beginning their probationary period in 2008 or after.
• Makes on-line nursing degree programs eligible for High Need Nursing Degree program aid.

 

Aid to Localities

The enacted budget includes funding for the following new General Fund programs:

• Academic programs of the Buffalo City School District ($3 million).
• After School Programs – to provide academic enrichment outside of the regular school hours primarily to children who attend high-poverty and low-performing schools and schools identified as being in need of improvement ($9.8 million).
• Mentoring and Tutoring Program – to produce outcomes, based on effective model programs, that include, but are not limited to, improved graduation rates ($980,000).
• Supplemental Valuation Impact Grants to provide financial assistance to school districts which have experienced a significant reduction in the taxable full value or extraordinary tax judgments ($3.8 million).

 

The enacted budget increases funding for the following General Fund programs:

• Adult Literacy (an additional $894,000 for a total of $7.2 million).
• Nonpublic Mandated Services Aid (an additional $12.2 million for a total of $139.6 million).  Note: Reimbursement is limited to 98 percent of actual cost.

• Workplace Literacy (an additional $628,000 for a total of $2 million).

 

The enacted budget reduces funding by 2 percent for the following General Fund programs:

• Academic Intervention for Nonpublic Schools (a reduction of $20,000 for a total of $980,000).
• Adult Basic Education (a reduction of $40,000 for a total of $1.96 million).
• Apprenticeship Training (a reduction of $36,000 for a total of $1.8 million).
• Center for School Safety (a reduction of $9,000 for a total of $466,000).
• Charter School Development (a reduction of $120,000 for a total of $5.9 million).
• County Vocational Education and Extension Boards (an additional $286,000 for a total of $986,000).
• Extended Day/Prevention of School Violence (a reduction of $604,000 for a total of $29.6 million).
• Health Education Program (a reduction of $15,000 for a total of $735,000).
• Math and Science High Schools (a reduction of $30,000 for a total of $1.47 million).
• Migrant Education (a reduction of $1,000 for a total of $89,000).
• National Boards for Professional Teaching Standards (a reduction of $10,000 for a total of $490,000).
• Nursing Degree program (a reduction of $27,000 for a total of $1 million).
• Primary Mental Health program (a reduction of $19,000 for a total of $951,000).
• School Lunch and Breakfast program (a reduction of $634,000 for a total of $31 million). Note: Reimbursement is limited to 98 percent of the 2007-2008 school year reimbursement rates.
• School Under Registration Review (a reduction of $38,000 for a total of $1.86 million).
• Summer Food program (a reduction of $66,000 for a total of $3.3 million).

 

The enacted budget reduces funding for the following General Fund program:

• Transferring Success (a reduction of $314,900 for a total of $314,900).

 

The enacted budget eliminates the following General Fund program:

• Civility, Citizenship and Character Education (a reduction of $475,000).

 

 

PROFESSIONS

 

State Operations

 

• Authorization for the Department to retain the administrative fee incurred in processing credit card transactions when physicians choose to pay by credit card.

 

VESID

 

Aid to Localities

 

The enacted budget increases funding for the following General Fund programs:

• Preschool Education (4410) (an additional $40.4 million for a total of $703.5 million).

• Private (4201) Schools for the Blind and Deaf (an additional $4.73 million in Federal IDEA funds for a total of $122.83 million).
• SUNY Center for Autism (an additional $490,000 for a total of $990,000).

 

The enacted budget reduces funding by 2 percent for the following General Fund programs:

• Case Services (a reduction of $24,000 for a total of $54.6 million).
• College Readers Aid (a reduction of $6,000 for a total of $294,000).
• Early Childhood Direction Centers (a reduction of $13,000 for a total of $643,000).
• Independent Living Centers (a reduction of $235,000 for a total of $13 million).
• Supported Employment (a reduction of $278,000 for a total of $16.1 million).

 

The enacted budget reduces funding for the following General Fund program:

• Prevention of Instructor Turnover (a reduction of $2 million; funding transferred to the Federal IDEA program).

 

The enacted budget also:

 

• Statutorily establishes Independent Living Centers in Putnam, Sullivan and Herkimer counties.

 

Capital Projects

 

• $2.33 million – Safety and environmental control improvements at the Rome State School for the Deaf.
• $650,000 – Health and safety, security, access and other improvements at the Batavia State School for the Blind.

 

 

AGENCYWIDE

 

State Operations

 

The enacted budget also:

 

• Restores Article VII language exempting the Department from certain provisions of Section 112 of the State Finance Law limiting the need for contracts with certain public entities.
• Includes authorization to fill an additional 113 FTE for non-General Fund programs where funding is available.

 

Capital Projects

 

• $2 million – Education Building Annex mechanical system upgrades.
• $1 million – Minor Rehabilitation Projects Department-wide pursuant to a plan to be approved by the Division of the Budget.

 

SCHOOL AID

 

• Overall funding for General Support for Public Schools in the enacted budget is estimated at $21.37 billion. This represents an 8.8% increase of $1.73 billion, from $19.64 billion in 2007-08.
• The phase-in of the new Foundation Aid formula and of Universal Prekindergarten are continued.
• With respect to Foundation Aid, the enacted budget maintains the existing minimum increase of 3%.  The overall funding level for Foundation Aid increases from $13.7 billion to $14.9 billion, an increase of 8.8% or $1.2 billion.
• Funding for Universal Prekindergarten is increased as well.  Current estimates for the 2007-08 school year indicate that grants will total $354.5 million.  Districts are estimated to be eligible for $450.8 million in 2008-09, an increase of $96.3 million, or 27.2%.
• The enacted budget maintains the present formula provisions for BOCES Aid.   BOCES Aid increases from $623.6 million to $672.2 million, an increase of $48.6 million or 7.8%.
• The enacted budget adopts the Executive proposal to add a new Aid for Academic Improvement, directed primarily toward the Big Five City School Districts.
• The enacted budget includes an increase of $2 million for English Language Learners.
• The enacted budget continues the current computation of building aid ratios.  Building Aid increases from $1,830.5 million to $2,000.5 million, an increase of $170.0 million or 9.3%.
• The enacted budget adds $102.1 million to the Executive's $100.2 million High Tax Aid proposal.
• The enacted budget restores $3.9 million in Supplemental Public Excess Cost Aid.
• The enacted budget provides $9.0 million in new funding for districts that have been in DINI status for at least 5 years.

 

 

 

ATTACHMENT 2

 

PROPOSED 2008-2009 SPENDING CONTROL PLAN

 

 

SUMMARY

 

Budget Bulletin B-1178 requires a reduction of 3.35 percent of all State Operations General Fund and Special Revenue-Other Accounts.

 

The calculation of a full 3.35 percent reduction results in the following:

 

              General Fund:  -$2.1 million (out of $61 million)

              Special Revenue-Other:  -$4.8 million (out of $144 million)

              Authorized Fill Level:  57 FTE (out of 3,296 FTE including 9 new OSPRA FTE)

 

The reductions are distributed across program areas as follows:

 

OCE

General Fund:  -$29,014 (out of $866,100)

              Special Revenue-Other:  -$747,738 (out of $46.2 million)

              Authorized Fill Level:  -13 FTE (out of 450 FTE)

P-16

General Fund:  -$1.5 million (out of $43.4 million)

              Special Revenue-Other:  -$964,990 (out of $11.6 million)

              Authorized Fill Level:  -13 FTE (out of 686 FTE including 9 new OSPRA FTE)

OP

General Fund:  -$0

              Special Revenue-Other:  -$1.5 million (out of $44.6 million)

              Authorized Fill Level:  -12 FTE (out of 359 FTE)

VESID

General Fund:  -$0

              Special Revenue-Other (State Schools):  -$788,668 (out of $20.4 million)

              Authorized Fill Level (State Schools):  -7 FTE (out of 227 FTE)

OMS

General Fund:  -$561,185 (out of $16.8 million)

              Special Revenue-Other:  -$837,331 (out of $21.5 million)

              Authorized Fill Level:  -12 FTE (out of 622 FTE)

 

 

 

Attached is a copy of spending controls that were imposed on May 1, 2008.

 

 

State Education Department

2008-2009 Nonpersonal Service Spending Controls

Effective May 1, 2008

 

 

In accordance with Budget Bulletin B-1178, all discretionary nonpersonal service expenditures (including travel, conferences, publications, supplies, equipment and contractual services) will be eliminated.  Only expenditures that are either non-discretionary or determined by agency senior management that are necessary to protect the health, safety and security of employees and citizens or the delivery of core agency services will be incurred.

 

The following definitions of core agency services, non-discretionary and discretionary spending will guide the State Education Department’s spending until further notice:

 

Core agency services include direct services to schools, higher education institutions and the public including, but not limited to: licensing, fingerprinting, vocational rehabilitation, teacher certification, the State Museum, Library and Archives services and the services at the State schools at Rome and Batavia.  Expenditures that are necessary to protect the health, safety and security of employees and citizens, or are necessary to ensure continuation of critical operations and services, as determined by the Deputy Commissioner, may continue.

 

Non-discretionary activities are those that the agency must do because of statutory mandate or as a condition of accepting the funds. Necessary and appropriate expenditures, as determined by the Deputy Commissioner, should continue.

 

Discretionary activities are those that SED may elect not to do even though such activities may be essential, high priority operations and/or services.

 

The following activities are prohibited:

 

• Out-of-state travel other than required travel to Washington, D. C.
• In-state air travel
• Department-sponsored conferences including conferences that SED sponsors via grant or contract to third parties
• Conference attendance (including no cost)
• Provision of food at meetings, conferences or gatherings of any kind
• Rental of private meeting space
• Purchase of “marketing materials” (tote bags, pins, mouse pads, mugs, T-shirts, hats, etc.).
• Subscription renewals
• Membership renewals
• Printing of newsletters, pamphlets, literature of any kind, unless required by statute
• Mass mailings
• Color copying of printed material
• Purchase of equipment such as cell phones, palm pilots, printers, copiers
• Consultant services including temporary agency services
• Paid overtime

 

Please note that All Deputy Commissioner approved out-of-State travel, conference activities and conference attendance also requires Chief Financial Officer approval.

 

The following list of considerations will help guide you in achieving nonpersonal service savings and determination on certain nonpersonal service expenditures:

 

• Eliminate non-essential work
• Review names on all mailing lists, for duplication, elimination
• Eliminate mailing whenever information can be electronically transmitted
• Eliminate color printing whenever possible
• Reduce/defer printing whenever possible
• Deploy train the trainer techniques to eliminate the number of travelers