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Plan Under Serious Consideration -- Package Would Also Include Significant Funding for School Construction and Modernization

Schumer, Paterson: We Cannot Let the Economic Crisis Send NY Schools to Fiscal Detention

As President-Elect Barack Obama’s transition team and Congressional leaders craft the massive economic stimulus package, U.S. Senator Charles E. Schumer and Governor David A. Paterson today announced a joint effort to include billions in new education block grants funding as part of the stimulus package to ensure schools in New York and across the country are protected during the economic crisis. Schumer and Paterson are pushing for the creation of a new education block grant program that could send billions in direct education aid to both states and localities to ease pressure on school budgets that are facing massive cuts as the economy tumbles.


“The largest expenditure in our state and local budgets is education and with good reason. If we are really going to do something to help state budgets, we have to do something about education. The bottom line is in the red, and this spells disaster for the education of our students and for our property tax bills,” Schumer said. “That is why Governor Paterson and I are pushing to bring billions to New York State in education money. Every dime given should be targeted to New York kids and the teachers who care for and educate them day in and day out.”


"No state has been more severely impacted by this crisis than New York, the home of Wall Street and the global capital of business and finance. I have asked the Obama Administration to include initiatives that the Empire State needs the most right now—not only to overcome the current crisis, but to begin laying the foundation for the economy of the future. The current economic climate is forcing states to consider significant cuts to P-16 education funding. Substantial federal investment in education will be needed to stem this tide. A flexible education block grant would provide governors with much needed fiscal relief, and mitigate the need for cuts to vital education programs,” Governor Paterson said.


New York State school budgets are severely strained and are facing severe budget cuts to P-16 education funding due to the current economic downturn. Schumer and Paterson said that the billions of additional dollars would go toward alleviating the dramatic crunch facing state and local budgets. In addition to preventing massive teacher layoffs and programmatic cuts, Schumer and Paterson said that by injecting funding directly into those education budgets, New Yorkers would be spared property tax hikes which are used to by school boards to cover education costs. From large cities like New York City to smaller municipalities in Long Island and Upstate, many local governments are considering or have already imposed significant property tax hikes to close historic budget gaps. Schumer said that the last thing New York homeowners can afford during these difficult times is jump in already sky high property taxes.


A flexible education block grant would provide New York State with much needed fiscal relief, and mitigate the need for cuts to vital education programs.


Schumer and Paterson today discussed different funding mechanisms that may be included in the stimulus package to deliver the money to states and localities, but said that under any of the plans, Schumer and Paterson will push for New York State schools to receive billions of dollars.


There are various approaches that Congress can use to deliver these critical funds to students and schools. U.S. Senate and House Leadership are consulting with the President's team to determine the best, most effective way to provide schools with the targeted resources necessary to maintain jobs and academic programs. Congress is considering using existing federal education funding formulas, such as the one used for Title I, No Child Left Behind funding, to determine the amount each state will receive in block grants. Schumer said it is essential that the block grants are distributed in a way that gives states and districts the flexibility and tools they need to keep serving our children.


In addition, Schumer and Paterson are pushing to ensure that part of the infrastructure portion of the stimulus package goes toward school modernization and construction. Schumer and Paterson said that schools in New York and across the country are in dire need of structural overhaul and upgrade. Schumer and Paterson emphasized that investing in upgrading schools with stimulus money would have the three-fold benefit of bringing New York schools into the 21st century, completing these projects without having to cut services or lay off teachers, and creating good paying construction jobs to boost the regional economy. It is estimated that every $1 billion of federal investment in infrastructure creates 30,000 jobs.


Last year, Governor David Paterson released a budget aimed at closing the more than $14 billion state budget deficit that included significant cuts in state education aid. Governor Paterson’s budget assumed no increases in federal aid to states this year.


Schumer said today that the economic stimulus package is expected to pass in early February.


Schumer said that this education funding would dovetail with other aid included in the stimulus package to be used to upgrade transportation, water, and sewer infrastructure and direct state budget aid. Earlier this month, Schumer announced that transit agencies in New York State, including the MTA, were in line to receive hundreds of billions of dollars in federal capital funding to upgrade their systems and purchase new, more efficient, equipment. In addition, Schumer said that New York State was in line to receive approximately $5 billion in direct state budget aid and aid to localities through FMAP and it is on track. Schumer and Paterson emphasized, however, that this money will only alleviate but not eliminate the tough choices state and local officials have to make in order to get their fiscal houses in order. 

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