It is an attempt to focus debate on the $15 million his administration says the proposal would save, instead of on the damage his $1.5 billion state aid cut would cause for schools and students.

The Albany Times Union published an editorial titled “Gov. Cuomo’s unworthy debate.”

The Journal News serving the Lower Hudson Valley warned, “Superintendent cap won’t improve schools.”

Watertown Daily Times called for “No salary caps.”

Our statement in response to the proposal observed that, “School systems need strong and resourceful leaders as superintendents now more than ever,” and that districts are already finding it hard to get candidates for superintendent positions.

On the evening of the day the Governor made his proposal, the Council’s Executive Director Bob Reidy appeared on the statewide cable news program, Capital Tonight.

Today, Bob was on the statewide public radio program, Capitol Pressroom.

The Governor’s proposal would cap superintendent salaries based on district enrollment.  Salaries superintendents serving districts with enrollments up to 250 students would be capped at $125,000. The cap would rise in $10,000 increments up to a maximum of $175,000 for districts with more than 6,501 students.

The proposal would affect contracts entered into, amended or extended after the bill becomes law, if it does.

The bill is unclear on what should happen if a district’s enrollment changes enough to move it from one cap size to another.

The bill also limits superintendent benefits to those available to state management/confidential employees. 

Superintendents would not be able to receive compensation for accrued vacation or sick leave or use accrued sick leave to pay health costs in retirement in a manner which differed from that provided to state M/C employees.  In many cases, superintendents would be allowed fewer vacation and sick leave days than more junior school employees.

If a district chose to pay the insurance benefit costs (health, disability, life or other insurance) for superintendents, the amount paid would be included in the total annual salary of the superintendent for purposes of the cap.

The Times-Union also offered this editorial cartoon in response to the Governor’s proposal.

Superintendents have been leading their communities in confronting similar painful choices for their schools over the past several years.

In many districts, they have passed up raises or made other concessions to save money for their districts and to set an example, and will again this coming year.

The Governor is attempting to put the state’s finances on a sustainable basis and we respect that.

But his attacks on superintendents are a damaging distraction from the difficult work that must be done, as one columnist has suggested.

The Governor proposes cutting aid by $1.5 billion.  That is more than all school district central administration expenditures statewide.

The proposed budget would also shift more than $250 million in special education costs to school districts.

If we wiped out every cent of central administration spending in every district, it still would not be enough to fill the hole the Governor’s School Aid cuts would create.

His proposed budget would cut state aid by an average of more than $1.4 million for districts outside the Big 5 Cities.

The average superintendent salary in New York State last year was $163,000 (the average nationally was $160,000).

If every superintendent took a 5 percent pay cut, it would save their districts an average of $8,150 — about one half of one percent of the average School Aid cut.

Speaking at one of our conferences several years ago, U.S. Senator Chuck Schumer referred to superintendents as “the shock absorbers of the system.”

Superintendents must try to strike the right balance between what schoolchildren need and what taxpayers can afford.

They are held accountable for taking policies made for the whole state or nation and making them work for all the diverse communities in our state.

Superintendents develop and manage multimillion-dollar budgets and construction projects.

They negotiate contracts with unions.  They hire, evaluate and dismiss employees.

They oversee bigger transportation systems and food service businesses than any other entity, public or private, in most communities.

Every day school is in session, they see it as a personal duty to every parent to keep every child safe.

School districts are crucial community assets. They are often the largest employer in the community. They may be the reason families choose to buy homes where they do. They prepare their community’s young people for the demands they will face in adult life.

Especially now, the work of protecting and improving these essential assets should be not be left to the lowest bidder.

Today, superintendents lead in a climate where expectations for student achievement are rising while revenues are diminishing.  They are expected to lead the changes needed to successfully balance these diverging demands.

More than ever, the state needs schools to have the strongest leaders they can get.

In all cases, superintendent compensation has been negotiated with boards elected by the voters, disclosed to the public, and included in budgets voted upon by district residents.

There are, of course, significant differences in the job markets and career paths for governors and superintendents.

While candidates spend millions of dollars to become governor,  school districts find it difficult  to recruit  qualified superintendents.

We are not aware of any governor who rose directly from civil servant, to bureau chief, to assistant commissioner, to commissioner, to governor.  But most superintendents began their careers as classroom teachers, some in the districts they now lead.  Differences in salary are necessary to lead people to accept longer hours, wider responsibilities, and loss of tenure that come with moving up the leadership ladder.

No good purpose is served by minimizing the challenges facing either state or school leaders.

Changes could take two forms:

1. creating additional requirements with the goal of ensuring that all graduates are ready for college, a career or both; and
2. providing more flexibility in how students may satisfy graduation requirements.

The Regents are conducting a series of regional forums to gather opinions.  They are also conducting an online survey.

The Department leadership has asked that we encourage participation by superintendents  –  and we do.

The outcome of this effort could be enormously consequential for schools and students.

The schedule of regional forums is available here.

Each forum will begin at 5:30 and will be hosted by a member of the Board of Regents.

You can complete the online survey here.   It will be open until midnight, February 18.

As background for these discussions, SED recommends reviewing this 23-page document prior to attending a regional meeting.

Also, for more concise background on the issues and proposals, here are the questions posed in the online survey.

Some of the specific ideas being considered include requiring all students to complete a fourth year of science or math, or a “college/career readiness unit” which might be an AB, IB or CTE course.

Other options could be to require a higher score to pass the Math and English Regents, or to award a “college and career ready” diploma to students who pass all or some Regents Exams with a score of 75 or 80.

There are others.

In terms of flexibility, the Department has offered for consideration allowing students to earn credit by demonstrating competency rather than meeting seat time mandates, providing students with flexibility in the courses they take in middle school, and providing more flexibility in the Regents Exams students must pass, for example.

Creating additional requirements for graduation might be a necessary tradeoff for providing additional flexibility – without the former, the latter could be portrayed as a lowering of standards.

I can imagine a few reactions to this exercise.

School leaders might say, “Don’t we have enough on our plates already, facing state aid cuts, surging benefit costs,  the prospect of a property tax cap, while also trying to implement all the Race to the Top priorities?”

A parent or taxpayer might say, “A high school diploma should mean that a graduate is ready to succeed in college or a job.  If it doesn’t, the Regents are right to be looking at changes.”

I am a parent and a taxpayer, and I work with school leaders.  I can share all the foregoing sentiments.

In addition to reacting to specific ideas already put forward by SED, it is important to step back and consider the goal – ensuring that students who successfully complete high school are, in fact, prepared to succeed in the next stage of their lives, a job or college.

So, beyond the ideas presented by SED, here are some other questions to consider:

• Are there other, better ways to accomplish the goal of assuring that graduating students are prepared to succeed in college or a career?

• To what extent are students already meeting the goal?

• If some students are not meeting the goal, should that require changes affecting all students?

He said he would propose two new incentive funding pools for School Aid, each for $250 million, one to provide rewards to districts which improve academic results, another to encourage administrative efficiencies.

He stressed that, “Current education funding is largely formula-based grants with no performance incentives,” and expressed admiration for the impact of the federal Race to the Top initiative in instigating reforms.

He did not reveal any other plans for School Aid.  With deep cuts predicted, one concern could be that that the new incentive pools will be funded by reducing traditional aid beyond what deficit reduction already calls for, at a time when schools are also struggling with pensions and other costs, while facing the prospect of a cap on their ability to raise local revenues.

He cited education, health care and economic development as areas where results don’t match investment, contending that we are first in spending on education but 34^th in results.  The performance measure was not disclosed.

The Governor reiterated his call for a property tax cap, which would limit local tax increases by schools and local governments to the lesser of 2 percent or inflation, unless a higher amount wins approval by at least 60 percent of voters.  There would be only limited exemptions – for example, for large legal settlements and extraordinary capital expenditures.

A big piece of news occurred before the Governor spoke, when Assembly Speaker Sheldon Silver said,

…we must strive to make our state a more affordable place in which to live, to work, to raise a family, and to own and operate a business. That means working together to cap property taxes.

The Assembly has not previously passed a tax cap.

The Governor did not offer details of new measures to help schools and local governments accommodate aid cuts and a tax cap.  He did announce, however, that he will launch a “mandate relief redesign team” which will include school district representatives.  It will be charged with proposing the elimination of unnecessary mandates by the April 1 state budget deadline.

Early in his speech, Governor Cuomo said,

Our government costs are simply unsustainable – at this rate government employee pension and employee benefit costs will collapse the state’s economy.  The cost of pensions and health benefits for active and retired employees will grow from $1.3 billion in 1998-99 to $6.2 billion in 2013-14…

During his campaign, Mr. Cuomo called for a new Tier VI in the state’s public retirement systems, saying the recently enacted Tier V was a step in the right direction but that it did not go far enough.  Today, however, he did not spell out any proposals to reduce or restrain employee benefit costs.

Mr. Cuomo also reiterated campaign proposals to encourage local government consolidation through new funding incentives.  He did not specifically address school district consolidation.

On the state budget in general, the Governor said he will

• close the projected 2011-12 state budget deficit (now estimated to be $10 billion) without new taxes or borrowing
• impose a one-year salary freeze on the vast majority of state employees whose collective bargaining agreements are up for renegotiation as of April 1;
• hold the line on taxes; and
• impose a state spending cap limiting growth in spending to the rate of inflation.

He also emphasized the need for procedural reforms in state government and the consolidation of state agencies.

Overall, Mr. Cuomo’s speech was well-received by the audience, including the Legislators present.  He employed touches of humor, such as a slide comparing the state budget process to three ships passing in the night, zooming in to find pictures of himself, Speaker Silver and Senate Majority Leader Dean Skelos in naval regalia.

Obviously, it’s troubling for school leaders to contemplate how to reconcile surging benefit costs, expected state aid cuts, and the prospect of a restrictive property tax cap.  But so far, I’ve been impressed by the new Governor’s serious and constructive tone in confronting the state’s problems, avoiding demogoguery, and challenging fellow public servants to rise to the occasion.

The bill passed the Assembly two weeks ago.  It was proposed by the Governor, so his approval is certain.

Nearly six months into the state fiscal year, other portions of the 2010-11 state budget remain unresolved, however.

Also, during their return to Albany, the Legislature did not act on Governor Paterson’s call for mid-year cuts to close an estimated deficit in the state’s 2010-11 budget.

Education Jobs Fund
In August, the Governor and the majority and minority party leaders in both legislative chambers signed a letter to U.S. Education Secretary Arne Duncan promising to pass legislation to distribute the Jobs Fund money.

District-by-district Jobs Fund allocations under the executive-legislative agreement were then posted on the State Education Department website. 

But the state constitution orders that, “No money shall ever be paid out of the state treasury or any of its funds, or any of the funds under its management, except in pursuance of an appropriation by law.”

So the State Education Department could not send out any checks, despite the agreement among state officials on how the money should be allocated among districts.

But now the necessary appropriation has passed the Legislature.  The appropriation includes language prescribing how the funds are to be allocated and it assures that each district will receive the amount promised in the School Aid run posted by SED in August.

Each district will receive a share of the Education Jobs Fund equivalent to 43.025989 percent of its “net Gap Elimination Adjustment” (or GEA).  The GEA is the lump sum cut in total aid for each district proposed by the Governor and enacted by the Legislature.

A listing of the allocations is available here.

Federal law allows districts until September 30, 2012 to “obligate” their allocations.  For this purpose (paying employees) funds are obligated when the work is done.

Education Budget “Language Bill”
Customarily, the state budget for education is enacted through two bills:

• one making appropriations for the State Education Department and other agencies comprising the education, labor and family assistance (ELFA) portion of the state budget, and
• a language or “Article VII” bill amending provisions of law (such as School Aid formulas), chiefly to align them with the spending levels provided for in the appropriations bill.

After the Assembly and Senate passed its version of a state budget in late June, Governor Paterson exercised his line-item veto authority to veto virtually every appropriation added by the Legislature, included a proposed $579 million School Aid restoration.

The Governor also vetoed the entire education budget language bill, chiefly because it amended School Aid formulas to produce the $579 million restoration.  But the bill also included other uncontroversial but consequential provisions, including items initially proposed by the Governor himself.

Neither the Assembly nor Senate acted on the Governor’s proposed new education budget language bill during their sessions over the last two weeks.

In order to pay School Aid, SED needs two pieces of law:  an appropriation giving authority to pay, and a set of formulas instructing how to pay.

The Governor had included some proposed formula changes within his recommended appropriation for School Aid, which became law immediately upon passage by both houses.  This included his proposed “Gap Elimination Adjustment (GEA),” imposing lump sum reductions in aid to every school district.

Had the GEA formula not been included in the enacted appropriation, SED might have been unable to make School Aid payments starting in September, since aid formulas in law would have required significantly greater payments than the enacted appropriation could support.

Although SED has been able to execute School Aid payments, a budget language bill must still be enacted for other reasons.

There are several provisions of law which the Legislature chooses to extend every year for only one year at a time and these are done as part of the annual education budget language bill.

For example, to help New York City and other districts minimize the impact of 1990-91 mid-year state aid cuts, a law permitted districts to count in their current fiscal year some aid to be paid in the following year.  This provision has been extended every year since 1991 and now represents a $200 million impact for New York City alone.

For the time being, the state and affected districts have been operating as though that law has continued in force.

Charter School Transition Freeze
Opposition from charter school advocates appears to be the primary reason for the Legislature’s failure to act on the Governor’s proposed language bill.

Consistent with his original Executive Budget from last January – and with the Assembly-Senate bill he vetoed in July due to overall cost concerns – Governor Paterson’s latest education budget language bill would have continued a freeze on the per pupil tuition payments districts are required to make to charter schools.

The failure to resolve the charter school tuition issue puts some districts at significant risk.  The higher tuition level would cost the Buffalo school system over $20 million and would cost Albany more than $5 million.

Aid Calculation Data Freeze
One positive aspect of the Governor’s latest proposal is that it abandoned freezing 2009-10 School Aid payments at the levels calculated back in January.  This freeze had been included in the Governor’s original budget proposal and in the vetoed legislative version.

Since the 2009-10 school year is done, the data freeze could have required some districts to return aid which they had already been paid, according to the laws in place when those payments were made.

The state’s need to impose a data freeze diminished when updated data revealed aid costs had declined on the own, as a result of school districts spending less in reimbursement-based aid categories.

Between May and November, the state’s estimated 2010-11 costs for Transportation, BOCES, and high cost public special education aid declined by a total of nearly $150 million.

Reorganization Incentive Building Aid
One missing piece from the Governor’s proposal which several districts are seeking is an extension of eligibility for Reorganization Incentive Building Aid.  Every other year the legislature has extended for two years the deadline for making use of the incentive.

Existing law allows districts to use the incentive for projects for which general contracts have been executed by 10 years after consolidation, or July 1, 2010, whichever is later.  Districts are seeking to have the latter deadline extended.

As a compromise to a complete extension, we suggested allowing districts which had projects approved by their voters by July 1, 2010 to benefit from the incentive.

Again, at some point the Legislature will have to pass an education budget language bill.

Dealing with Deficits
Although a specific proposal was never made public, Governor Paterson also asked legislators to enact mid-year cuts to close an emerging deficit in the current state budget.

The Governor’s Budget Division estimated the gap in the current year state budget at $315 million.  Others warn the gap could be much larger.

State Comptroller Thomas DiNapoli estimates the current year gap could be over $1 billion.  The Assembly and Senate do not report complete surplus/deficit estimates, but fiscal staffs for both majorities are both more pessimistic in their revenue forecasts than their executive branch counterparts.

Here is a summary of the various revenue and expenditure forecasts made by executive and legislative offices last month.

Reportedly, the Governor’s proposal would have cut School Aid by at least $150 million.  This cut would have been on top of the $131.5 million in current year aid reductions already imposed on school districts to address the state’s shortfall in federal Medicaid funding.  A listing of the earlier reductions is available here.

The Assembly was reported to be prepared to pass the Governor’s package of proposed mid-year cuts, but the fractured Senate majority could not pull together enough votes for the plan, and neither house acted.

Legislative leaders said the current year deficit could be addressed in the context of working on a budget for next year.

Even before they left Albany, Governor Paterson and his successor-elect Andrew Cuomo condemned the Legislators for failing to act.  Unlike Washington, Albany cannot run deficits perpetually.  Under the state constitution, the Governor must propose a balanced budget.  Any deficit in the current year budget will need to be made up next year, if not before.

I’ll write more about the outlook for the coming state fiscal year in the days ahead.

We will not be weighing-in on whether Ms. Black should should get a waiver from the requirement that school district superintendents hold an administrative certificate issued by the State Education Department.

Instead, two of our members will participate formally in that decision.

Commissioner Steiner included Rochester Superintendent Jean-Claude Brizard and Yonkers Superintendent Bernard Pierorazio on his panel.  Mr. Brizard serves on the Council’s Executive Committee.

A former Council member, current SED Associate Commissioner Kenneth Slentz, will also serve on the panel.

Ms. Black’s selection initially provoked opposition, partly for her lack of an education background, partly for the closed process by which she was chosen.

More recently, she has received some high profile support, including from three former mayors (Koch, Dinkins, and Giuliani), a collection of New York City business leaders, and even Oprah Winfrey.

The New York Times speculated that the evidence presented to support Joel Klein’s candidacy might be hard to match for Ms. Black.

In addition to career experiences in business and as an Assistant U.S. Attorney General, the Times observed, “Mr. Klein, the son of a postal worker, attended public schools in Queens and taught math to sixth graders in the city.”

The Times also noted that whatever the Commissioner decides will set a precedent for other districts.

As a general rule, we have said that school districts are in the business of teaching and learning and it makes sense for their top leaders to have a background in that business.

At the same time, we have acknowledged that the job of New York City Chancellor is not the same as leading and managing a more typical school district, where a superintendent cannot escape wearing many hats, including educator-in-chief.

A past president of the Council, Rockville Centre superintendent William Johnson, served on the panel that endorsed Mr. Klein’s waiver.

Ultimately, the question for Commissioner Steiner is whether state law (Education Law section 3003) can be interpreted to permit a candidate with Ms. Black’s experiences to serve as Chancellor.  Here’s what the law says:

The commissioner, at the request of a board of education or board of cooperative educational services, may provide for the issuance of a certificate as superintendent of schools to exceptionally qualified persons who do not meet all of the graduate course [i.e., 60 credit hours] or teaching requirements [i.e., three years of experience] of subdivision one of this  section, but whose exceptional training and experience are the substantial equivalent of such requirements and qualify such persons for the duties of a superintendent of schools.

The Department’s news release explains,

The Commissioner will carefully review and consider the advice he receives from the panel. He will then apply the law to the facts presented and render a decision on the waiver request.   The request for a waiver of specified training and experience is part of a credentialing process. That process comprises an objective review of education, training, and experience to determine if an applicant possesses the knowledge, skills, and experience that qualify him or her to perform the functions authorized by the credential.

I would have been stunned had New York not made it this far this time.

If there was a surprise in the selections, it is that the U.S. Education Department advanced more than half the states submitting applications to the finalist stage.  Eighteen states and the District of Columbia were chosen.

The federal Department picked all the states which made it to the finals last time but did not win funding (including New York) and five new states.

Since coming up short in phase 1, New York has acted to advance its standing in addressing several of the RTTT priorities:

• The state has assembled about $40 million and taking other steps to improve student data systems — this was the single biggest weakness in it first round application;
• It raised the cap on the number of charter schools authorized to operate in the state; and
• It passed a law requiring the use of student performance data in teacher evaluation.

Here again is the chart I prepared comparing New York’s first round ratings with those of higher ranking states on each dimension of RTTT criteria.

Of course, other states have also acted to improve their chances.  That is one of the interesting ramifications of picking only two winners (Delaware and Tennessee) in phase one — it left a lot of money on the table ($3.4 billion) for states to compete for, while also impelling them to scratch for ways to improve upon the applications they submitted in phase 1.

The next step in the competition will come during the week of August 9, when teams from all the finalist states travel to Washington to meet with federal reviewers, presenting their proposals and responding to questions.

Yesterday, Board of Regents Chancellor Merryl Tisch announced the team which will represent New York State that week:  herself, Commissioner David Steiner, Senior Deputy Commissioner John King, New York City Schools Chancellor Joel Klein, and New York City United Federation of Teachers President Michael Mulgrew.

The composition might get noticed for its heavy New York City representation.  (As I just did).  If it works, however, the whole state gains.

The state was second-guessed after phase 1 for emphasizing ground-level expertise over big names.  The phase 1 team included Steiner, King, SED Assistant Commissioners Ira Schwartz and Laura Smith, and New Visions for Public Schools President Robert Hughes.  In contrast, the teams from winning Delaware and Tennessee both included their governors.

Winning states are expected to be announced in late August or early September.  U.S. Education Secretary Arne Duncan has said he expects that 10 to 15 states will be chosen for funding.

Education Week noted, “…the number of winners—whether it’s closer to 10 or 15—will depend on which states win. After all, if New York, Florida, and California win and are awarded the maximum amount allowed by the Education Department’s rules, they’ll eat up $2.1 billion, or more than half of the remaining funds. Altogether, the states are asking for $6.2 billion, far more than the $3.4 billion that’s available.”

Information on New York’s application is available here.

Stay tuned…

The group which brought the suit (the Empire State Supervisors and Administrators Association) can appeal the decision.  For reasons which have always eluded me, “Supreme” Court is the lowest of the three tiers in the state court system.

The decision is available here.

The Teachers Retirement System says this about the challenge:

“As of this writing it is not known whether this decision will be appealed. The payment of the unreduced retirement benefit to eligible members who retired pursuant to Chapter 45 will be subject to the final outcome of any appellate process. Please watch the NYSTRS Web site for news of any further developments. Members considering retirement under Chapter 45 may wish to consult with their collective bargaining representative and/or attorney.”

On the positive side, on Wednesday, the Federal Reserve Bank issued one of its periodic “Beige Book”  reviews of economic activity across regions of the nation.

Gannett News sums up the regional report,

There were “scattered signs of improvement in the job market” throughout the state and widespread plans by businesses to increase capital spending. Manufacturers were described as “upbeat.”

Consumer confidence reached a two-year high in April in the New York-New Jersey-Pennsylvania region, according to a separate report by the Conference Board.

On the other hand, also yesterday, State Comptroller Thomas DiNapoli issued a report on the state’s housing markets.  The Comptroller notes that New York has fared better than some other states.  He concludes,

By the beginning of 2010, the decline in home sales and the increase in foreclosures in New York appeared to have leveled off. However, property values continue to decline in Long Island and the Hudson Valley regions and the housing market is still performing below the 2006 pre-crisis levels.

The report is titled “Upstate/Downstate:  New York’s Diverging Housing Markets,”  reflecting the sharper declines in home values on Long Island and the Hudson Valley than upstate.  It includes an interesting color-coded map showing changes in home value by school district.

Housing trends might also be characterized as “converging,” with downstate property values descending but still with a long, long way to drop before they reach upstate prices, as this table indicates. 

March 29, 11:40 a.m. — Education Week is reporting that only two states — Delaware and Tennessee — will be named first round winners of race to the Top funds.  Confirmed by the New York Times and Washington Post.

On the bright side, the majority of funding will remain available for the round 2 competition, with applications currently planned to be due on June 1.