Hochul: Major Foundation Aid changes off the table for now in Albany

After both chambers of the state Legislature passed a short-term spending bill to ensure that National Guard members get paid on Monday, Gov. Kathy Hochul provided some updates to reporters on the latest budget negotiations. “The end is near,” she said Thursday afternoon.

Asked about education funding, one of the big sticking points in the budget, Hochul suggested that major changes to the Foundation Aid formula would not be part of this year’s budget deal – but they're still coming. The governor had originally pitched significant changes to the formula, which is the main way that school money gets allocated. Under the formula that the governor proposed, many districts around the state would receive less money than they anticipated. Hochul also wanted to eliminate a provision known as “hold harmless,” which has traditionally ensured that schools receive at least as much funding as the year before, regardless of any enrollment loss. Hundreds of schools would see sharp funding decreases under the original Hochul plan with the repeal of that provision.

Hochul said she spoke with legislative leaders about “putting a process in place” to update the Foundation Aid formula, since some school districts have seen drastic declines in student enrollment in recent years. “By this time next year – giving everybody the notice and warning they all asked for that there would be a different formula,” Hochul told reporters. “And I’m just deciding with the leaders how that mechanism will work.”

Based on what Hochul said, it’s unclear whether her school aid pitch will be fully reversed in a final budget deal. But big changes to the formula that education advocates and lawmakers characterized as cuts, like a potential major shift in the formula’s consumer price index adjustment, appear to have been staved off for at least the upcoming school year. But Hochul still seemed keen to implement a new formula soon that would “put us in a much better place.”

Both the state Senate and the Assembly rejected Hochul’s Foundation Aid formula changes and the elimination of “hold harmless” in their one-house budgets. They instead proposed a $1 million study to make recommendations on how to amend the formula, which many education advocates acknowledge needs updating.

Earlier on Thursday, state Senate Deputy Majority Leader Michael Gianaris told reporters that figuring out the best way to study changes to Foundation Aid is “one of the final pieces of the conversation.” He said that reversing the proposed cuts was the “core” for members in the short term. “In terms of a long-term evaluation of the formula, I think everyone agrees we can do it,” Gianaris said, adding that the specifics of that evaluation have not been determined. He wouldn’t say explicitly that cuts were off the table, but said his conference “would not be comfortable agreeing to a budget without those cuts being restored.”

On one of the other contentious issues holding up the budget, Hochul expressed optimism about reaching a deal on a housing package. “Think about where we were a year ago, where we are today, it is light years apart how far we’ve come,” the governor said. She did not offer specifics about what may be in or out of the package, but said that some proposals that were “dead on arrival” last year have been resurrected. “I call them my Lazarus bills,” Hochul quipped.

Lawmakers approved a second short-term budget extender on Thursday before leaving for the weekend that will last until Monday. Legislators will need to pass another extender – or the budget – before midday Monday in order to make sure checks for state employees go out on Wednesday.

Members of the Assembly are expected back in Albany on Sunday, potentially to just pass the next extender. But the chamber won’t hold its session as originally scheduled on Monday, which is also the day that some New Yorkers will have a chance to see a full solar eclipse. The state Senate is still expected back on Monday, although Gianaris suggested that the chamber may also return early to approve another short-term spending stopgap.