Fourteen school districts statewide were designated in some level of fiscal stress under New York State Comptroller Thomas P. DiNapoli’s Fiscal Stress Monitoring System for the school year (SY) ending on June 30, 2022, down from 23 districts in fiscal stress the prior year. This is the lowest incidence of fiscal stress recorded for schools since the system’s inception (2012-13 school year).
“The number of districts designated in a fiscal stress category has fallen considerably over the past three years. This year there was a particularly steep drop because of significant increases in both federal and state aid,” DiNapoli said. “High need districts in urban and suburban areas, which typically have the highest incidence of fiscal stress, received some of the largest increases in aid. However, the federal aid is temporary so school district officials may face difficult operational and staffing decisions in determining how to best provide services to their students in the future.”
DiNapoli’s Fiscal Stress Monitoring System was designed to identify issues that school districts, counties, cities, towns and villages are having with budgetary solvency, or the ability to generate enough revenues to meet expenses. The Comptroller releases fiscal stress scores for the various categories of government three times a year. School districts are given a fiscal stress score based on several factors: year-end fund balance, operating deficits and surpluses, cash position, and reliance on short-term debt for cash-flow. The higher the score the more severe the level of stress.
The monitoring system, which excludes New York City and the “Big Four” City School Districts of Buffalo, Rochester, Syracuse and Yonkers, found one school district in “significant fiscal stress,” which is the highest category - Mount Vernon City School District in Westchester County.
Five districts were designated as being in moderate fiscal stress. Only one of these, East Ramapo Central School District in Rockland County, saw a decrease in its stress score since last year. The remaining four – Arkport Central School District (Steuben County)Harrisville Central School District (Lewis County), New Suffolk Common School District (Suffolk County), and Roscoe Central School District (Sullivan County) – had score increases.
In response to the COVID-19 pandemic, the federal government passed three major multiyear grants of aid targeted to low-income school districts. In total, school districts included in FSMS reported receiving nearly $1 billion in temporary federal aid during SY 2021-22.
DiNapoli’s report also notes many school districts also saw a substantial increase in ongoing state aid. In State Fiscal Year 2021-22 Enacted Budget, the state committed to fully funding Foundation Aid for school districts by SY 2023-24. Total state aid reported by school districts (excluding New York City and the Big Four) increased from $13.8 billion in SY 2020-21 to $15 billion in SY 2021-22, an increase of $1.1 billion, or 8.5%.
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