CSM testimony on proposed budget cuts to schools 4/8/11

Testimony of Leonie Haimson, Executive Director of Class Size Matters

NYC Council Hearings on Preliminary Budget Hearing – Education – Expense

April 8, 2011

Hello, my name is Leonie Haimson, Executive Director of Class Size Matters.  Thank you for allowing me to testify today.

Since yesterday, there has been tremendous instability and uncertainty in the area of education, with the announcement of the appointment of a new chancellor, and a State Education Commissioner who intends to leave at the end of the school year.

At the same time, there is tremendous uncertainty and distress among parents about the mayor’s proposed cuts to our schools, of eliminating 6,000 teaching positions, at a time of enrollment growth.  These proposed cuts are draconian and would be devastating to our children.

Class sizes have increased sharply in all grades the last three years, and in the early grades they are already larger than they have been in over a decade.

These further cuts to the classroom  would likely lead to the sharpest increases in class size in  at least thirty years, and even further harm our children, their opportunities and success in life, who continue to be disadvantaged by the largest class sizes in the state, and some of the largest in the nation.[1]

What are the alternatives?  First, the city should immediately go to Albany and ask to raise the personal income taxes on the wealthy.

According to the Independent Budget Office, a small surcharge for city earners of $175,000 or more would raise $450 million. [2] In 2007, New York City had the most unequal income distribution in the nation, with the top one percent receiving nearly half of the total income.  Since then, top earners have benefited from additional tax cuts at the state and federal levels.

See this chart from the Fiscal Policy Institute:

Secondly, there remains substantial waste in the education budget.  While cutting back $350 million on school staffing, the DOE proposes to maintain excessive spending on central administration and the mid-level bureaucracy, with increases in OTPS, a category in which they can hide expensive consultants, private contracts and the like.

The Independent Budget Office has proposed several areas of education spending that could be cut, including a one year hiatus on new schools, which would save an estimated $15 million. [3] The 400 plus new schools created over the course of this administration have created even more overcrowding, more contentious battles over space, more inequities, more challenges for at-risk and “over the counter” students that the small schools do not enroll, and even more administrators hired at the expense of classroom teachers.  During the first eight years of this administration, the number of out-of-classroom positions has increased by about 10,000, while the number of general education classroom teachers was cut by nearly 1600.[4]

As it is, 25 percent of all elementary schools have waiting lists for Kindergarten next year, with over three thousand children who cannot get into their zoned neighborhood schools.[5] Over 8,000 students, or 10% of all 8^th graders, did not get into any of their ten choices for high school.[6] For a system that is supposedly built on “choice,” all these new schools have not apparently led to better options for parents or even more importantly, better outcomes for their kids.

Unfortunately, the DOE expects to also spend more than $700 million next year on charter schools, with those students in co-located charters, receiving $700 more in per pupil public funding than district public school students, according to the IBO’s estimate, counting the space and the services they receive for free. The approximate worth of what DOE provides to charters for free is more than $3000 per student.[7] The city should immediately start charging these charter schools for the full costs of the space and services, as the law provides, which would yield about $100 million in extra funds.

Another incredibly wasteful expense is the many millions the city proposes to spend on expanding the Izone over the next few years, and to increase online testing – both costly and risky experiments that are unlikely to improve learning.[8]

In the category of “what can they be thinking,” on March 25, the Department of Education recently put out an RFP for new “local assessments” in all grades 3-12 and in subjects, that will undoubtedly cost tens of millions of additional dollars, take up hours of teacher time and money to score, and that are expected to result in 16 different contracts.[9]

Not only does this represent incredibly wasteful during a time of huge budget cuts to schools; and incredibly unwise, given how our schools are already overly focused on testing and test prep.  The biggest outrage is that when the Common Core standards are adopted, in the next year or two, which NY State has already signed onto, these assessments are likely to be useless since they will not be aligned with the standards.

Yet even these millions are secondary to the hundreds of millions of dollars that the DOE seem intent on spending on yet another large-scale experiment on our kids, the expansion of online learning to 400 schools over the next two or three years.

Online learning has little or no research to back it up, as made clear in a recent NY Times article.[10] And yet DOE is once more rushing in, with no independent evaluation to show that any of the pilot Izone programs have worked, and no clear accounting of the costs

A recent report from the Center for the Reinvention of Public Education lays out the risks and points out correctly that these plans have no buy-in from parents:

“The district is also contemplating how parents will respond to these innovation initiatives and is working on outreach and communications plans. At some point, the district may get pushback from parents about the idea of having their children participate in unproven programs and may need to consider catch-up academic plans if certain programs are not effective. “ [11]

Here is another telling observation from the report:

“NYC school district leaders are taking risks with the iZone, implementing new models, committing deeply to a defined set of principles that challenge core assumptions about what a school should look like, and moving to scale very quickly. How and when they will know if they got the big bet right is a question district leaders will have to ask so that students are not subjected for too long to programs and schools that don’t work.”

I urge you to stop this dangerous experiment on our children, likely to cost hundreds of millions of dollars, before it’s too late.  Instead, please ensure that there are no more class size increases next year.

There is no way any computer or computer program can eliminate the need for a closer connection between student and teacher; and to pretend otherwise will yet further undermine the quality of education that our children receive.

Finally, here are three other possible sources of funding to fill the gap, according to the IBO:

“One source of such resources is the retiree health benefit trust fund, which was set up to begin funding the city’s contractual commitment to provide health insurance for retired city workers. The estimated value of those future obligations is about $70 billion, and unlike future pension obligations, there is currently no requirement that those obligations be funded, although that is expected to eventually change. A few years ago the Mayor established the trust fund to begin providing for those needs and made an initial deposit of $2.5 billion. Although set up as trust fund to deal with future needs, the city has withdrawn some of the funds this year ($395 million) and plans to do so again next year ($672 million). Since the Mayor has demonstrated a willingness to withdraw money from the trust fund to meet current needs, the possibility that he could take more exists, although it would be at the cost of increasing future budget needs. Assuming his 2012 drawdown goes ahead as planned, the trust fund would have about $1.4 billion.

A second possible resource if one needed/wanted to tap it would be a portion of the general reserve in next year’s budget. The city is legally required to have $100 million in reserve for fiscal problems that might emerge, but typically budgets more than the minimum. Unused reserves at the end of the year are used to help balance the close or if not needed, rolled forward are part of the surplus. The proposed 2012 budget has a general reserve of $300 million ($200 million more than the legal minimum). While the $100 million required amount is a bit outdated – it has not been adjusted for inflation or the size of the city budget in many years – some might feel comfortable sticking with the minimum required rather than budgeting more.

Another type of resource that would probably be available are the typical accounting and clean-up adjustments that get made each year as part of the budget close. For example, the city has both receivables and payables on its balance sheet, some of which get written off each year at the close. In some years, these transactions can generate a few hundred million dollars (net positive) that can be used for last minute needs at the close or to roll into the next year as part of the surplus. Because the city doesn’t know which payables they will be able to cancel and which receivables they may have to drop at the start of the year, these transactions are usually not shown in the budget and are shown only at the close.[12]