New York Comptroller Thomas DiNapoli has found that 13% of New York school districts are fiscally distressed.
Of the 674 school districts DiNapoli's office staff looked at, 12 were experiencing significant fiscal stress, 23 were experiencing moderate fiscal stress and 52 were said to be susceptible to fiscal stress. The office counted all three categories as being fiscally stressed in calculating the 13% figure.
"School districts are a critical barometer of the fiscal health of our local communities," DiNapoli said Thursday when the report was released. "Unfortunately, reductions in state aid, a cap on local revenue and decreased rainy day funds are creating financial challenges that more and more school districts are having trouble overcoming."
In June DiNapoli released his assessment of the level of fiscal stress of about 900 municipalities and counties in New York. In September he assigned ratings to an additional 88 communities. His office found 3.8% of the 988 municipal and county governments to be fiscally stressed.
Those school districts in fiscal stress generally have low fund balances, operating deficits and limited cash on hand. They were also much more likely to be using short-term borrowing and bridge cash flow gaps.
The districts received scores expressed in percentages, with higher percentages signifying higher stress.
The school districts the office found to be in significant fiscal stress are: Watervliet City School District (83.3), Lewiston-Porter Central S. D. (81.7%), Niagara-Wheatfield Central S. D. (80%), Kiryas Joel Village Union Free S.D. (75%), Bay Shore Union Free S. D. (73.3%), West Seneca Central S. D. (73.3%), Poughkeepsie City S. D. (71.7%), Sachem Central S. D. (70%), General Brown Central S. D. (66.7%), Utica City S. D. (65%), Tupper Lake Central S. D. (65%), and Schenectady City S. D. (65%).
The office found that urban/suburban school districts with large proportions of students in poverty were three times more likely to be considered fiscally stressed than school districts with small proportions of such students.
The percentage of school districts in fiscal stress exceeded 30% in six counties: Chemung, Clinton, Madison, Montgomery, Niagara and Tioga. In general, Central New York (22.9%), North Country (16.9%) and Western New York (13.9%) had the highest percentage of stressed school districts. Central New York includes Oswego, Cayuga, Madison, Cortland, and Onondaga counties.
The office did not review the New York City, Buffalo, Rochester, Syracuse or Yonkers school districts, which are part of their city governments. The office plans to put out a report covering the fiscal health of the latter four cities in March or April. It will not be rating New York City.
"In general, we believe additional financial oversight by the state can help stabilize local governments, including school districts," Moody's Investors Service analyst Rob Weber said after the report was released.
