Local schools face a reduction in state foundation aid

SARANAC LAKE — Area schools are slated to collectively lose more than $2.9 million in foundation aid for the next school year if the state Legislature approves policy changes proposed in Gov. Kathy Hochul’s executive budget plan.

Saranac Lake Central School District and Lake Placid Central School District would see the largest foundation aid losses at $1,469,668 and $843,853, respectively, while Long Lake Central School District stands to see the largest proportional loss at $128,249, or 44.7%, of its foundation aid. Tupper Lake Central School District, Keene Central School and AuSable Valley Central School District will also see reductions in their foundation aid.

Created in 2006 following a court decision, foundation aid is the largest aid category that supports public schools across the state. Hochul proposed a $507 million increase in foundation aid for the 2024-25 school year. To fully fund the foundation aid formula, there would need to be a $927 million increase, which is in line with past years’ fully-funded increases of $1.5 billion for 2022-23 and $2.6 billion for 2023-24. With a more than $400 million difference in expectations, many school districts statewide would see no increase or even a decrease in foundation aid.

Hochul’s budget also proposes changes to the way that districts across the state calculate their foundation aid.

Foundation aid varies by district. It is calculated by taking into account factors like local cost of living, existing district funding and student needs and costs. Hochul’s foundation aid proposal has two tentpoles: Altering the formula that calculates foundation aid and eliminating the “save harmless” — sometimes called “hold harmless” — provision, which ensures that the total foundation aid a district receives is not smaller than the previous year’s total.

The new formula takes into account “transition adjustment,” which is calculated via a second formula. Transition adjustment is a wealth-based calculation. The elimination of the “save harmless” provision is a by-product of this formula change and not something that is legislated explicitly. The formula changes are located in Part A of the Education, Labor and Family Assistance Bill, which can be viewed at www.tinyurl.com/vx2vym4e.

These changes are part of Hochul’s executive budget plan, not the state’s enacted budget, which the Legislature must pass before April 1 and may be different than Hochul’s plan. A bipartisan group of local representatives have expressed their disapproval of the foundation aid changes and have promised to work toward fully funding foundation aid in the enacted budget. Until the state’s budget is passed, however, school districts must build their own budgets around the numbers in Hochul’s plan.

School budgets must be adopted by April 15 before they are presented to voters for approval on May 21.

Lake Placid

LPCSD is anticipating one of the largest proportional foundation aid losses in the Tri-Lakes. With $843,853 of its foundation aid on the chopping block — a 41.7% decrease — the school board and administration are approaching the budgeting process as if the aid loss will happen.

“Right now, we’re building a budget,” said LPCSD Assistant Superintendent for Business, Finance and Support Services Dana Wood. “What we’re doing is, we’re going off of this current proposal, so I’m using these numbers to work off of. We’re going to be using a lot of additional revenue in interest.”

At a Jan. 23 meeting, the school board discussed a foundation aid loss of $617,000, a number that Wood later said was an inaccurate representation presented by the state. That number offset the anticipated foundation aid losses by applying the full total of a grant the district would never receive.

“We have a grant for our universal pre-K, and up until last year, our grant amount wouldn’t exceed $405,000. And then, for this coming year, that year it’s jumping up to $631,800,” he said. “So, it makes it look like, on paper, that we’re actually getting over $200,000 more in aid. But, in reality, that aid is based off of actual enrollment. … In order for us to get the full $600,000, we’d need to have more than 63 pre-K students. We have not ever exceeded the allotments.”

Wood said that the district would be tapping into additional revenue gained from interest to fund its budget for the next school year.

The district accepted an audit by New York state Comptroller Thomas DiNapoli in November that reported district officials failed to “develop and manage a comprehensive investment program” and said that, had they done so, the district might have earned about $267,000 more during the two-year audit period.

In the district’s written response to the audit, Wood said that he would solicit quotes on a yearly basis and authorized the transfer of more than $10 million out of the district’s insured cash suite and into NYCLASS, which is a higher-yield, short-term liquid investment fund.

LPCSD Superintendent Timothy Seymour said that, though the district’s budget will be built on Hochul’s numbers, he remained optimistic.

“We are hopeful that the Legislature can amend the governor’s proposal in a more thoughtful and equitable manner,” he said.


Keene Central School District is set to lose $158,504 of its foundation aid, a 32.6% decrease. The district is “in the early stages” of finalizing its budget, according to district Superintendent Dan Mayberry.

“At this point, we don’t have final numbers on health insurance increases and some of that stuff,” he said. “The final number is hard to tell.”

Mayberry said that the loss would require a 2.4% increase in the tax levy just to offset that cut, and that’s before the district figures in other potential spending increases.

“To start the budget process with that kind of increase, that already exceeds our allowed tax levy cap percentage,” he said. “(That’s) not ideal in any way, shape or form.”

KCSD exceeded the tax levy cap set by the last year, increasing its tax levy by 6.8%.

While other schools like LPCSD may turn to interest revenue to offset the blow of the foundation aid loss, KCSD has even more limited resources.

“If we have any fund balance left over, we’ll be using some of that to help soften the blow,” Mayberry said. “In a district as small as ours, there’s not many places where you can cut your way to savings.”

AuSable Valley

AuSable Valley Central School District is set for a 1.3% decrease in foundation aid at $179,020. Combined with an anticipated loss of federal aid, though, this will impact the district’s budgeting and programming, according to district Superintendent Michael Francia.

“Like most North Country schools here, we’re aid-dependent, heavily aid-dependent, and whenever there’s a cut in aid it affects what we can do,” he said. “Most of our schools have lost their (American Rescue Plan) money as well. … We have to take a real good look at what programming we’re offering. We’re going to have to be creative with how we staff that.”

Francia said the district is set to lose $736,595 in ARP Elementary and Secondary School Emergency Relief funding. ARP ESSER was signed into law in March 2021 to help schools continue operating during the coronavirus pandemic and transition back to in-person schooling.

“With the loss of that $736,000, you’re looking at your net revenue being $340,000,” Francia said. “But the cost of everything has gone up so much, that doesn’t come close to covering the increase in expenses that we’re estimating.”

He added that, as of now, the budget does not look like it’ll exceed the tax levy cap. However, the school board has some tough decisions on its horizon as it tries to mold operations to fit the ever-reducing budget.

“More money is going out than you have coming in, and it leaves us with some tough decisions,” Francia said. “We’re constantly in a cycle of having to cut … in order to have a balanced budget.”

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