New York State provides billions of dollars in annual aid to local school districts to support public K-12 education and help offset disparities in local wealth. This page covers CBC’s work on Foundation Aid formulas, school funding equity, per-pupil spending trends, special education mandates, and the use of state aid for school infrastructure and transportation.
This page was created with AICBC Insights uses AI to group, analyze and present data and recommendations from CBC's publications. Always reference the cited sources to verify important details..
The State could use its aid actively to convert schools to renewable energy sources as renewable energy technology gains in market share.
State aid could incentivize school districts to purchase zero-emission school buses and build the needed charging infrastructure.
Aid could be refocused to stop reimbursement of new GHG-emitting investments and instead be directed towards zero emissions buses.
Key Data
In June 2026, the CBCNY noted that New York State's practice of increasing school aid even when enrollment declines wastes $700 million and undermines funding fairness.
In March 2026, the CBCNY reported that New York State provides $2.9 billion in State education aid to districts that can already self-fund a sound basic education for fiscal year 2027.
For the 2023-24 school year, New York State increased State school aid by 8.8% from $34.4 billion to $37.4 billion, which resulted in a 10.2% rise in per-pupil State aid.
In March 2023, the CBCNY highlighted that total school spending in New York was projected to reach $85 billion in school year 2024, which far exceeded the Statewide sound basic education need of $68 billion.
According to U.S. Census data cited in June 2014, New York led the nation in public education spending in 2012 by spending $19,552 per student, compared to a national average of $10,608.
The state budget includes $700 million in wasted school aid increases despite declining enrollment and $547 million in pension benefit enhancements that threaten local school district budgets. These spending decisions reflect a broader pattern of prioritizing short-term political appeal over long-term fiscal stability and structural reform.
Recommendations related to State Education Funding
The state should stop increasing school aid when enrollment declines to avoid wasting funds and undermining funding fairness.
The state should avoid enhancing pension benefits that pressure local governments and school districts to cut services or raise taxes.
Key Data
$700 million
— wasted by increasing school aid even when enrollment declines.
$547 million
— cost of enhancing already excellent pension benefits that will pressure local governments and school districts.
New York State's fiscal year 2027 budget proposals include a $1.4 billion increase in school aid, but much of this funding is poorly targeted due to 'hold harmless' provisions and minimum increases that cost $589 million. Better aligning school aid with actual student need and district fiscal capacity could save up to $2.9 billion annually by reducing funding to districts that can already self-fund a basic education.
Recommendations related to State Education Funding
The State should eliminate hold harmless and minimum increase provisions in school aid formulas.
The State should revise formulas to better reflect student need and local capacity so that State aid is allocated effectively.
The State should reduce State aid to self-funding school districts.
Key Data
$589 million
— Estimated cost of minimum increases in Foundation Aid in fiscal year 2027.
$2.9 billion
— Estimated State education aid in fiscal year 2027 provided to districts that can self-fund a sound basic education.
$1.4 billion
— Increase in school aid driving State Operating Funds spending growth between fiscal years 2026 and 2027.
$500 million
— Proposed increase in school aid without improved targeting in the one-house budgets.
$252 billion is the Governor Kathy Hochul’s New York State Executive Budget for Fiscal Year 2026. How much does it matter that New York State and its localities are already #1 in taxes and #2 in spending nationwide? On today’s episode we talk with New York State’s Budget Director, Blake…
To address projected budget gaps reaching $9 billion next year and a $22 billion structural deficit, New York State must restrain spending growth in its largest programs, including education. Better targeting state school aid to high-need districts rather than wealthy ones is critical to stabilizing the budget without resorting to harmful tax increases or depleting reserves.
Recommendations related to State Education Funding
State school aid should be better targeted to districts with higher-need students, instead of funneling billions of dollars to wealthy districts with strong local funding.
New York State school aid has increased by 8.8 percent to $37.4 billion, with per-pupil funding rising by 10.2 percent. While significant resources are directed toward districts that already self-fund a Sound Basic Education, billions more in state aid are distributed to districts in excess of these basic needs.
Key Data
8.8%
— The increase in total State school aid from $34.4 billion to $37.4 billion.
10.2%
— The rise in per-pupil State aid.
$2.8 billion
— The amount of State aid directed to 152 districts that fully support a Sound Basic Education with local and regular federal funding.
$8.6 billion
— The amount of additional State aid provided to other districts in excess of the Sound Basic Education level.
$9.6 million
— The total Sound Basic Education shortfall for five districts where funding is negative.
$11.4 billion
— The total amount of State aid for all districts in excess of a Sound Basic Education.
New York's total school spending is projected to reach $85 Billion in school year 2024, far exceeding the estimated $68 Billion needed for a statewide sound basic education. To address this, the state should eliminate hold harmless provisions and redirect $3.1 Billion in state aid away from 164 wealthy districts that already self-fund their basic education needs.
Recommendations related to State Education Funding
The State should target all school aid based on need, reduce aid to wealthy districts that fund a sound basic education with local resources, and eliminate hold harmless provisions that ensure state aid increases year-over-year.
At a minimum, the State should not increase State aid to wealthy districts that self-fund a sound basic education.
Additionally, the State should eliminate hold harmless provisions and should combine expense-based aids into needs-based formulas to account for local wealth and capacity.
Key Data
10%
— The projected increase in New York State school aid for the next fiscal year.
$85 Billion
— Projected total school spending, combining local, State, and federal aids, for school year 2024.
Nearly $10 Billion
— Amount of school spending based on district expenses rather than local need or fiscal capacity.
$3.1 Billion
— Amount of State aid going to 164 districts that already self-fund a sound basic education.
164
— Number of school districts that self-fund a sound basic education but still receive State aid.
$68 Billion
— The estimated Statewide sound basic education need, which is far exceeded by total spending.
New York State is phasing in a 32% education aid increase, but needs to better target these funds to high-need districts to stabilize its budget and increase equity. This includes reevaluating over $3 billion in annual assistance currently sent to wealthy districts that are already capable of self-funding a sound basic education.
Recommendations related to State Education Funding
To stabilize the budget and increase equity, the state should better target education aid to high-need districts, including money that now reimburses districts on how much they spend for transportation and construction rather than student need.
The state should reevaluate education assistance to wealthy districts, especially those that receive over $3 billion annually despite already self-funding a sound basic education.
Key Data
32%
— The education aid increase that the state started to phase in during 2021.
$3 billion
— The annual amount of state aid received by wealthy districts that already self-fund a sound basic education.
50%
— The portion of the state budget comprised of Medicaid and education spending.
New York State increased school aid by 6.7% to $34.4 billion for the 2022-23 school year, even as student enrollment declined. Of this total, $3.1 billion is allocated to 176 wealthy districts that already possess the local and federal funding necessary to support a Sound Basic Education.
Key Data
$34.4 billion
— The total amount of State school aid for the 2022-23 school year.
$3.1 billion
— The amount of State aid directed to 176 wealthy districts that can fully support a Sound Basic Education with local and federal funding.
$10.4 billion
— The amount of State aid provided to other districts in excess of the Sound Basic Education level.
$32.2 billion
— The total amount of State school aid for the previous school year.
$220 billion is the reported size of the New York State fiscal year 2023 budget that the Governor and Legislature adopted on April 10. The budget includes a property tax rebate and a tax holiday, and increases State spending about $14 billion, with more money for education aid, day care,…
New York State is projected to increase school aid by 32% to $38.4 billion by fiscal year 2027, on top of $11.4 billion in extraordinary federal aid, despite already spending roughly double the national average per pupil. To ensure these resources deliver results, the state must implement performance management and better target aid by eliminating the "hold harmless" provision and restraining the $2.7 billion in annual aid sent to wealthy, self-sufficient districts.
Recommendations related to State Education Funding
The Legislature should ensure the massive influx of school aid delivers commensurate results.
The State should implement better management of performance—setting goals, tracking results, and increasing accountability—to ensure the additional $41 billion in federal and State school aid reverses learning loss, accelerates achievement, and narrows disparities.
Given the State’s long run fiscal risks, the Legislature should work to better target school aid to high-need districts, shifting some expense-based aids to foundation aid, eliminating the hold harmless and restraining aid to wealthy districts, especially those that receive $2.7 billion in aid per year despite already self-funding a sound basic education.
To achieve success, the State must ensure that aid and education services are carefully evaluated and well managed.
Key Data
$41 Billion
— The cumulative amount of additional federal and State school aid flowing to schools over the next five years.
$29.1 Billion
— The amount of State school aid in the current school year before the projected increases.
$38.4 Billion
— The projected level of State school aid by fiscal year 2027.
32%
— The percentage increase in State school aid from the current school year to fiscal year 2027.
$11.4 Billion
— The amount of extraordinary federal aid that school districts will spend now and over the coming years.
$2.7 Billion
— The amount of annual aid received by wealthy school districts that already self-fund a sound basic education.
270,000—the number of two-year, four-year, and graduate degree seeking students enrolled in the City University of New York (CUNY). For generations CUNY has been an engine of economic mobility. With New York City sitting at the inflection point between the pandemic-driven recession and its recovery, CUNY will play a key…
New York State's school aid, which includes over $5 billion for building and transportation, could be better utilized to support the state's climate goals by incentivizing renewable energy investments. By refocusing these funds to encourage the adoption of zero-emission school buses and clean energy infrastructure, the state can align its educational spending with its broader environmental mandates.
Recommendations related to State Education Funding
The State could use its aid actively to convert schools to renewable energy sources as renewable energy technology gains in market share.
State aid could incentivize school districts to purchase zero-emission school buses and build the needed charging infrastructure.
Aid could be refocused to stop reimbursement of new GHG-emitting investments and instead be directed towards zero emissions buses.
Key Data
$5 Billion
— The portion of the State’s budget allocated for school building aid and transportation aid.
$3,207 Million
— The current program cost for School Building Aid in fiscal year 2020.
$1,990 Million
— The current program cost for School Transportation Aid in fiscal year 2020.
Limiting school aid increases to only underfunded districts would support a sound basic education in every district for approximately $75 million, saving more than $750 million compared to the proposed $826 million increase. Additionally, folding ten education aid streams totaling $1.8 billion into an improved Foundation Aid formula based on need would preserve progressivity and better support student needs.
Recommendations related to State Education Funding
The State should limit increases in education aid to those needed to fund a sound basic education and improve the Foundation Aid formula.
The State should target school aid to underfunded districts.
The State should not undermine Foundation Aid progressivity by layering on less progressive forms of aid.
Ten education aids should instead be folded fully into an improved Foundation Aid formula that distributes all aid based on need, and appropriately accounts for student need and district ability to provide local resources.
The Legislature should reject shifting costs for Temporary Assistance for Needy Families onto New York City and special education out-of-district placement costs onto school districts outside of New York City.
Key Data
27%
— The portion of the State operating budget represented by school aid.
$75 Million
— The approximate school aid increase needed to support a sound basic education in every district if targeted only to underfunded districts.
$750 Million
— The amount of savings that would be achieved compared to the Governor's proposed increase by limiting school aid increases to high-need districts.
$826 Million
— The Governor's proposed school aid increase.
$1.8 Billion
— The total value of the ten education aid streams folded into Foundation Aid by the Executive Budget.
New York State's proposed budget includes a nearly $1 billion increase in school aid, yet it fails to adequately reallocate funds to high-need districts to ensure a sound, basic education for all students. Instead of directing resources where they are most needed, the plan continues to provide aid increases to wealthy districts that do not require additional state support.
Recommendations related to State Education Funding
The State should restrain growth in education aid and reallocate substantial funds to high-need districts to fund a sound, basic education.
The State should better target State aid to fund a sound, basic education statewide with a smaller annual increase.
The State should reallocate State aid among districts to address the fundamental issue of funding equity, rather than requiring individual districts to alter internal fund distribution.
Key Data
$1 billion
— The proposed increase to school aid in the fiscal year 2020 executive budget.
Watch the original broadcast here . As Governor Cuomo's second term comes to a close, and voters decide whether to give him a third term, the Citizens Budget Commission is looking at how the state has fared over the past eight years. The group is it out with a new…
Making changes to Foundation Aid formula would better help school districts most in need while avoiding providing unnecessary amounts of funding to the wealthiest districts. CBC's David Friedfel explains. Watch the original segment here .
We know that New York State leads the country in school spending per pupil. But how do those numbers break down when it comes to federal, state, and local spending? Most of the money comes from local governments through property taxes, which is how wealthier school districts are able to…
Today’s data point is $66 billion – the amount New York’s school districts received in revenue during the 2015-2016 school year. The state's 674 districts collect an average of $23,635 per student - however, 15 districts surpass this amount, collecting $40,000 per student, while 11 districts fall short, collecting only…
New York State faces a constitutional obligation to provide a sound basic education, yet current funding distribution formulas often fail to direct resources to the neediest districts. By reforming the Foundation Aid formula to prioritize high-need areas, the state could meet its educational requirements with significantly less additional spending than some advocates suggest.
Recommendations related to State Education Funding
The state should fix the Foundation Aid formula to ensure resources are directed to the neediest districts.
The state should redirect $2.7 billion to needy districts to better align funding with actual educational needs.
The state should return Foundation Aid to its intended purpose of directing aid to the neediest districts.
The state should transform how education funds are distributed to reduce the total amount of additional funding required.
Key Data
$4.3 billion
— Additional funding advocates say is needed next year.
$2.1 billion
— Amount proposed by the Board of Regents.
$430 million
— Portion of the governor's additional funding provided through Foundation Aid.
$569 million
— Additional funding needed if the state fixes the Foundation Aid formula.
$2.7 billion
— Amount to be redirected to needy districts if the formula is fixed.
$24 billion
— Aid to local school districts that the state already provides.
New York State's school aid is projected to grow by 5.1 percent in fiscal year 2018, reaching $25,639 Million, as part of a broader budget strategy that relies on fiscal gimmicks to adhere to a 2 percent spending cap. These budgetary maneuvers include converting the New York City School Tax Relief (STAR) benefit to a personal income tax credit, which reduces reported state spending by $277 Million without altering the actual benefit to taxpayers.
Key Data
$25,639 Million
— Projected School Aid in fiscal year 2018.
5.1%
— Projected growth of School Aid in fiscal year 2018.
$277 Million
— State disbursement savings from converting New York City STAR property tax exemptions to personal income tax credits.
TWC News The Board of Regents is calling for a $1.2 billion increase in school funding next year, including nearly $1.5 billion for foundation aid. However, he Citizens Budget Commission says there is a much cheaper way to help low-income students.
New York State's 674 school districts are mapped to illustrate the proposed increase in school aid per pupil for the 2016-2017 school year. This resource enables a comparison of state aid across major categories for each district.
Key Data
674
— number of school districts in New York State for which the interactive map shows the proposed increase in school aid per pupil in school year 2016-2017
This school year New York State will spend $23.5 billion on aid to school districts, accounting for 25 percent of the state-funded operating budget. The State’s role in K-12 public education is critical to offsetting disparities in local wealth and student need, yet numerous problems remain in the state school…
New York maintained its position as the top per-pupil spender on public elementary-secondary education in 2012, with costs averaging $19,552 per student, which is 84% higher than the national average. This spending disparity is largely driven by high teacher compensation and fringe benefits, the latter of which grew by 6.8% between 2011 and 2012, creating a squeeze on district budgets.
Key Data
$19,552
— Average per-pupil spending in New York on public elementary-secondary education in 2012.
$10,608
— National average per-pupil spending on public elementary-secondary education in 2012.
84%
— Amount by which New York's average overall per-pupil spending exceeded the national average.
169%
— Amount by which New York's instructional employee fringe benefits per pupil exceeded the national average.
6.8%
— Growth rate of fringe benefits for teachers in New York from 2011 to 2012.
2.5%
— Total growth in public elementary-secondary spending in New York from 2011 to 2012.
New York State currently imposes 227 special education mandates that exceed federal requirements, creating unnecessary administrative and financial burdens for school districts. Legislative action is required to pass the special education mandate relief package, which would streamline service decisions, reduce paperwork, and rationalize payment rates to improve efficiency.
Recommendations related to State Education Funding
Legislative leaders should bring the special education mandate relief bills to a successful vote in the final month of session.
The legislature should amend the laws to implement the special education mandate relief proposals approved by the Board of Regents.
The state should align the membership of the teams that make decisions about special education services at the preschool and school age level with federal requirements.
The state should reduce administrative and paperwork requirements for special education services.
The state should establish more rational regional payment rates for certain special education service providers.
The state should shorten the timeline for due process hearings to prevent drawn-out and costly proceedings.
The state should require mediation before disputes proceed to impartial hearings.
Key Data
227
— New York State imposes <b>227 distinct special education mandates</b> above and beyond those required by federal law.
New York State's school aid, which accounts for $21.2 billion of the operating budget, is currently subject to a proposed $1.7 billion reduction that disproportionately impacts poorer districts. To ensure equity, the state should adjust the reduction formula to place a greater burden on wealthier districts that possess a significantly larger local tax base per pupil.
Recommendations related to State Education Funding
The legislature should focus on improving the distribution of aid cuts to make them more targeted and improve their progressivity.
The two provisions that diminish and distort the overall targeting of the cuts should be removed from the formula by which the cuts are allocated.
The formula by which school aid reductions are made should be improved so that the burden is borne more squarely by those who can most easily absorb the cuts.
Key Data
$21.2 billion
— Total amount of school aid, representing the State’s largest expenditure item.
$1.7 billion
— Proposed reduction in school aid to help close the State's budget gap.
$750 million
— Amount of budget pain that could be spared for the neediest school districts if cuts were better calibrated by ability to pay.
$30,192
— Estimated average per pupil expenditures in the top 10 percent of wealthiest districts.
$16,065
— Statewide median per pupil expenditure.
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