The state Legislature’s full restoration of money it withheld from school districts in the aftermath of 2008’s financial crisis will likely help local districts and their taxpayers.
Some North Shore superintendents said their districts will use their portions of the more than $13 million that Nassau County schools will receive with the final “gap elimination adjustment” from the state to fund infrastructure improvements, start or expand on programs, or potentially lower their tax levy.
But to some officials, the end of the payments raises questions about how state aid could change going forward and what that might mean in budget seasons with a tight tax levy cap.
“(I)t’s hard to sustain things if in the future the state aid is flat and we have a very low tax cap of virtually zero, which means that our ability to increase revenues is really very difficult,” Herricks school Superintendent Fino Celano said.
The state’s 2016-2017 budget Albany lawmakers approved last Friday includes the last of the reimbursements to school districts for the so-called gap elimination adjustment, or GEA.
The state started restoring money in 2012 it withheld from school districts in 2010 and 2011 to close its own budget deficit.
The Herricks, Sewanhaka, East Williston, Mineola and New Hyde Park-Garden City Park school districts got larger state aid packages this year to account for an especially tight cap on tax levy increases, superintendents said.
None of them were set to make any cuts before final GEA payments came through, but officials said the money will help fund additional items.
“The fact that the state is going to make the district whole in terms of state aid puts us in a good position and gives us the opportunity to look at continuing to provide our students with all our great programs that we have in place,” Celano said.
Celano will present Herricks’ school board with a “menu” of spending options for about $629,000 in gap elimination adjustment money, he said. State budget documents show Herricks’ final GEA payment is $377,606.
They will include flattening the district’s proposed 0.12-percent tax levy increase, capital improvements, equipment purchases and repairs, or some combination of those, Celano said.
“We’re going to use that money for really one-time-only expenditures, because obviously this isn’t going to be sustainable,” he said.
In Sewanhaka, “The goal is to make an attempt to try to restore some of the cuts that were made over the last five or six years,” Superintendent Ralph Ferrie said.
State budget documents say the central high school district’s final GEA payment is $142,404, but Ferrie said the district will get an additional $1.6 million in aid.
Ferrie said in February additional state aid money could fund a daytime alternative school program, part-time athletic trainers for all five high schools, an evening facilities supervisor, or a decrease in the amount of reserves allocated in the initial budget.
Those are still on the table, he said Monday, and more options could be added when he presents them to the school board on April 12.
Mineola school Superintendent Michael Nagler gave his school board two options for additional state aid last month — pay for an additional one-off capital project, or reduce the $900,000 in unallocated fund balance in the coming year’s budget.
He said he will recommend the board use Mineola’s $191,000 final GEA payment to replace the lockers at Mineola High School because it’s more prudent for the district to spend some of its fund balance, which is larger than the recommended 4 percent of the total budget.
“We’re out of compliance with the 4-percent rule and we saved it for the last two years, so at this point, we might as well spend it,” Nagler said. “And it’s more purposeful to spend it on an item than it is to reduce the levy.”
East Williston’s school board adopted a 2016-2017 budget last Thursday, so the district will use its $113,421 final GEA payment to offset changes to the amount of payments in lieu of taxes from the Long Island Power Authority, Assistant Superintendent for Business Jacqueline Pirro said.
The payments are the subject of a lawsuit between LIPA and more than 40 Nassau school districts.
Pirro said East Williston has made “a guess” at how much it will receive from the power authority next year, but that could change as litigation proceeds.
LIPA has maintained its PILOT payments follow a state law that says they cannot increase more than 2 percent over the prior year.
Efforts to reach New Hyde Park-Garden City Park Superintendent Robert Katulak were unavailing.
The district’s final GEA payment is $126,791, state budget documents say.
Nagler said the end of GEA payments ceases “anticipation” among school districts for the state to finally make them whole and therefore makes planning easier to an extent.
But he and Celano said they wondered whether the state would sustain the large aid packages going forward.
Pirro said she thinks the boost from the GEA money will come at the expense of other state aid components next year.
“We’re trying not to be too skeptical, but the reality is when you get a boost like this, often in an election year, that you don’t know if this boost is going to be permanent,” she said.
Celano said he hopes the state will be “realistic” and give schools adequate funding to deal with their financial constraints, such as this year’s tight tax levy cap.
“I think every year the state tries to balance their budget and who needs what, as every district does,” Nagler said.
