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Campaign for Fiscal Equity

Thu, Jun 5, 2008

CFE Testifies on DOE Preliminary Contract for Excellence Plan at Staten Island Hearing

Public Participation Process Not in Compliance with State Law and Regulations

In testimony and written comments provided at the Staten Island hearing on June 5th, CFE went on record with its reactions to the Preliminary 2008-09 Contract Plan which the DOE posted on its website on May 30th. CFE raised concerns about both violations of the required public participation process and regarding the apparent distribution of the Contract for Excellence funds to a significant number of high performing rather than low performing schools and to non-contract purposes. First, CFE pointed out that the five hearings scheduled over two weeks, one in each borough, do not constitute the public comment hearings as described in the 2007 Education Reform Act and the relevant regulations. The regulations provide for public input during the development of the Contract and then for reasonable notice and detailed proposed Contract information for comment by the public at the 32 CEC hearings on the 32 community school district plans and at the five borough hearings on the citywide plan. 

Second, despite public statements to the contrary, the preliminary plan allocates Contract dollars to most of the city's schools indicating that Contract dollars are being used to fill budget gaps. The preliminary Contract plan fails to provide sufficient detail for informed comment on the budget allocations. 

CFE Staten Island Hearing Testimony including CFE's preliminary overview and analysis of allocations:

I am Geri Palast, Executive Director of the Campaign for Fiscal Equity. I want to thank the Department of Education panel for the opportunity to present our views and preliminary analysis of what we view as the beginning of the consultation process on the 2008-2009 Contract for Excellence. As we will detail in our testimony, these hearings do not constitute the public comment hearings described in the Education Budget and Reform Act of 2007 and the relevant state regulations. We have sent Chancellor Joel Klein, State Education Commissioner Richard Mills and the New York State Regents each two separate letters in May and June of this year detailing our objections to the structure of the proposal and allocations -- that include no central planning -- as inconsistent with the regulations, and the failure to comply with notice, comment and programmatic content requirements as well. Commissioner Mills has written the Chancellor and made it clear that compliance with the regulations is a condition of final approval. In hopes that these hearings can be transformed into the required consultation that leads to a proposed contract subject to a second round of public hearings that comply with the regulations, we will provide our views on what should and should not be included in this year’s contract.

The Contract for Excellence is the program and accountability structure that grew out of the resolution of the successful Campaign for Fiscal Equity (CFE) litigation. CFE established the constitutional right for every public school child to have the opportunity for a sound basic education, and secured the necessary resources to fund that right.

In 2007, the State provided $3.2 billion new education dollars for New York City (NYC) over four years, $2.3 billion for classroom aid invested in best practices subject to a Contract for Excellence developed with public participation and approved by the State. The 2007 Education Budget and Reform Act (Act), amended in 2008, permits investment in these six strategies: class size reduction, full day pre-k, more time on task, teacher and principal quality, middle and high school restructuring, and expansion and replication of successful English Language Learner (ELL) programs. NYC must also provide a five year class size reduction plan. Finally, the funds and programs must be designed and allocated to predominately serve the neediest students.

In 2008, the State reversed Governor Spitzer’s initial proposal to break the promise, and delivered $622 million in foundation aid for the City, $94 million more than the original $528 million promised for this year. After subtracting for 3% inflation and charter school tuition, generously estimated at $70 million, the New York City Contract for Excellence should cover an estimated $386 million, $30 million of which can be used to maintain efforts in current contract area programs. As noted above, these funds are to be used for impact by predominately serving high needs students in low performing schools. These funds must supplement current city school budgets not supplant, or substitute, for current or promised city funding.

New York City School Budget Cuts
New York City also has a matching obligation under the law. The Mayor of NYC is obligated to add $2.2 billion over four years. In 2007, he committed to add $650 million this year. These funds along with additional state funds outside foundation aid are unrestricted and can be used to fund schools and programs outside the Contract. Due to the Mayor’s failure to budget these funds, and based on some of the limited information presented here combined with Chancellor’s Klein’s testimony before the New York City Council, it appears that Contract dollars are being used to plug holes in school budgets thereby defeating the purpose of the CFE victory. Further, the Chancellor is seeking to exempt $63 million from these purposes to make up for this budget shortfall. Thus Mayor Bloomberg’s unwillingness to keep his funding promise is undermining the Contract for Excellence and the CFE settlement designed to spend the new funds on the high needs kids in low performing schools.

The Contract for Excellence Proposal
Budget allocations in the current NYCDOE Contract proposal fail to provide sufficient detail for informed comment. From what we can determine, despite public statements to the contrary, there continue to be investments in high performing schools, questionable program investments inconsistent with the contract, and major investments areas with insufficient or no information to permit analysis and comment.

CFE will address the following five proposals included in New York City’s proposed 2008-09 Contract for Excellence in the use of $386 million in Contract dollars:

  1. Discretionary Allocations

  2. Targeted Allocations to Schools

  3. School Support Services

  4. Maintenance of Effort

  5. School Level Planning Guidance

Discretionary Allocations -- $242 Million
The Department of Education (DOE) proposes allocating $231 million(excluding fringe) to 1,439 schools across the city without developing a plan prioritizing the educational strategies needed to improve student achievement. CFE performed a preliminary analysis of the distribution of funds and found that the DOE again ignored the Contract for Excellence regulations that specifically require that “For school districts in cities with a population of one hundred twenty-five thousand or more, at least 75 percent of the contract amount shall be distributed to benefit students having the greatest educational needs who are enrolled in the top 50 percent of schools within the district ranked in order of greatest to lease relative incidence, as measures against total school enrollment, of poverty disability, limited English proficiency and low school performance; provides that all schools within the district that are in improvement status shall receive at least their pro rata share of contract funds based on their share of total district need.”

Specifically, CFE found:

  • CInstead of targeting the Contract money, DOE has spread $231,091,326 – which includes allocations for school level decision-making and central initiatives of Collaborative Team Teaching (CTT) classrooms and Autism Spectrum Disorder programs – across 1,439 schools out of a possible 1,502 schools – excluding 56 District 75 schools. The Contract dollars appear to be plugging city budget cuts.

  • Inconsistent with the state regulations, nearly $38 million was allocated to schools where students met or exceeded the statewide average percentage (63.4) of students scoring at Level 3 or 4 on the 2006-07 ELA Assessments. An additional $11 million was allocated to schools that equaled or exceeded the statewide graduation rate of 67 percent for the 2005-06 school year.

In recent testimony before the New York City Council and in appeals to the SED, the DOE has maintained the need to obtain flexibility in $63 million in Contract funds to minimize school budget cuts at certain schools across the city. The flexibility needed would be to set aside the Regents regulation regarding the 75/50 rule. CFE would oppose this exemption from Contract distribution rules in any case. However, it is even more troubling since, despite NYCDOE’s claims, they appear to have distributed the $179 million broadly across most schools in the city flagrantly defying the rule without prior approval. As stated above, Chancellor Klein was clear that NYCDOE is simply planning to use the additional $63 million to plug more budget holes created by the city itself. At minimum, the DOE should have produced transparent information detailing the proposed distribution of the $63 million at the school level.

Targeted Allocations to Schools -- $97 Million
While CFE does not oppose the proposed $5 million for Pre-K expansion, the $2 million for the expansion of the ELL Summer School Program, and the $5 million for new and expanded Autism Spectrum Disorder (ASD) program, there is no detail provided specifying which schools would benefit from the Pre-K expansion or the expansion of the ELL Summer School Program. We do object to the following:
$64 Million in New and Expanded Collaborative Team Teaching (CTT) Program
CFE’s preliminary analysis of the distribution of the CTT Program dollars to 381 schools totaling more the $47 million found that $27 million is going to high performing schools:

  • 101 schools totaling more than $21 million received Contract funding where schools met or exceeded the statewide percentage (63.4) of students scoring at Level 3 or 4 on the 2006-07 ELA Assessment.

  • 12 schools totaling more than $6 million received Contract funding where schools equaled or exceeded the statewide graduation rate of 67 percent for the 2005-06 school year.

$20 Million in Expansion of School-Wide Performance Pay Initiative
As CFE interprets the regulation, pay incentive programs are narrowly defined “to encourage highly qualified and experienced teachers to work in low performing schools, provided that such programs shall not use funds for school-wide or district-wide salary enhancements or raises”. This proposal appears to violate the rule. In addition, the DOE’s Performance Pay Initiative is based on the city’s own Progress Report system and not the state’s Annual Yearly Progress Report system sanctioned by NCLB.

School Support Services -- $17 Million
The DOE proposed $7 million be used to support new and expanded Multiple Pathways to Graduation program. While nothing appears inherently wrong in choosing that strategy, no detail was provided as to which schools would receive that money and how much.
In proposing $10 million be allocated for new and expanded Principal Training – again, no details were provided showing how many Principals were trained previously and for how much – nor is there any information regarding previous sources of funding. In 2008, NYC needs to demonstrate that there is an increase in the number of Principals being trained and at what cost. The city has to be able to demonstrate that Contract dollars are supplementing not supplanting previously raised private or public dollars.

Maintenance of Effort
The Act permits New York City to use up to $30 million in Contract funding for Maintenance of Effort conforming to the allowable programs under the Contract. The DOE has chosen to utilize the full $30 million to support their Maintenance of Effort but has not presented the details of their plans.

School Level Planning Guidance
In meetings attended by CFE, the DOE assured us that there would be a system of check and balances to ensure the correct and effective use of the funding by schools. This would include securing approval from their SSO and ISC. In the training for SLTS, the proposed Contract advises the schools to consult with their SSO and ISC but does not require them to do it. Similarly, in the Class Size Reduction guidance, the schools are also advised to consult with their SSO and ISC but not required to do it.

Public Participation Process
The 2007 Education Budget and Reform Act (Act) and regulations require NYCDOE to consult with the public in developing the contract, and then to provide reasonable notice and detailed proposed contract information for comment by the public in five borough hearings. NYCDOE must then provide 30 days for written public comment on the proposed contract. They failed to do all three. The Act and regulations set out a two part process for the development and public comment on the Contract for Excellence. The Department was to consult with the stakeholders and the public to shape the Contract and provide central direction on initiatives prior to allocations to school, and then develop a proposed contract that provides detailed information including a description of the plan, and a detailed description of the proposed allocations: (1) on a school level, (2) by program area, (3) by student achievement performance targets, and (4) by affected student population groupings.

The only detailed description of proposed allocations made available by the NYCDOE is the allocations to schools and broad descriptions of proposed program area allocations. In addition Community School District Contracts which make up a portion of the citywide Contract must be reviewed by the Community Education Councils. Little of that has been provided for review here.

Notice Requirements
Further the DOE has failed to provide reasonable notice of these hearings as well as of the 30 day public comment process required in the regulations. Under the public hearings section of the regulation governing the Contract, each school district must provide “reasonable notice” to the public of each public hearing defined in the regulations as “at least one week prior” given to the news media, and conspicuously posted at least 72 hours before such hearing. The purpose of this provision is to ensure sufficient time to inform the public that such hearings will take place, and allow sufficient time for the public to prepare their comments for such hearings. The NYCDOE’s notice, however, was given on the afternoon on May 30, with the first hearing scheduled for June 5. The notice therefore provides only 4 business days before the first public hearing. Four business days is not “reasonable notice,” and does not allow sufficient time to inform the public of the hearing nor does it allow sufficient time for the public to prepare meaningful comments. The change of dates is confusing and further complicates the notice issue. Additionally, the regulations require that districts provide reasonable notice of the 30-day public comment period. The NYCDOE provided notice of the public comment period, however, on May 30, 2008, and stated that written comments will be accepted until July 1, 2008. NYCDOE thus failed to comply with this provision by commencing the 30-day period on the day that notice was given.

Translation Requirements
The notice must also be translated into the most commonly spoken languages other than English. While the NYCDOE has stated that they have translated the flyers into 8 languages, these translated notices are not readily available. In fact, the only indication that the notices have been translated is in an email from the Public and Community Affairs Office, written in English, providing an email address to request copies of translated flyers. When we asked for copies of these translated flyers from the Chancellor’s Office, none were provided. Additionally, the translated flyers are not available at this time on the Spanish version of the NYCDOE’s website, for example. Nor are they available on the Contract for Excellence pages of the NYCDOE website.

Conclusion: Reconstitute the Public Participation Process Consistent with the Act and Regulations; Conduct New Hearings Once the Contract is Developed with Appropriate Specificity

In sum, NYCDOE made allocations to the schools without a consultation process to develop a central plan, made allocations to schools that fail to drive the funds predominately to the neediest, and compounded the problem by their failure to comply with the notice and information requirements for the public participation process provided by the state law and regulations governing the contracts.

We urge NYCDOE to stop and reconstitute this process, plan and hearings consistent with the law. In the absence of NYCDOE action, we call on the state education department to intervene and enforce the law.

Parents from across the state march on the Capitol in Albany to show support for CFE.
CFE Litigation CFE v. State of New York
In 2006, after 13 years in the Courts, the New York State Court of Appeals affirmed the right of every public school student in New York to the opportunity for a sound basic education and the state’s responsibility to adequately fund this right, but deferred to the Governor and the Legislature to determine the appropriate amount. more >