Nine LI school districts face fiscal risk, state comptroller's report says
State Comptroller Thomas DiNapoli, in releasing the fiscal-stress report, noted that the statewide list of 23 districts identified for the school year ending June 30, 2021, was down from 31 systems named the previous year. Above, DiNapoli in 2019. Credit: Jeff Bachner
Nine Long Island school districts are among 23 statewide facing varying degrees of fiscal strain, according to a report issued Thursday by state Comptroller Thomas DiNapoli.
All nine systems flagged in Nassau and Suffolk counties were characterized as "susceptible" to fiscal stress, the mildest of three ratings applied by the state.
Rated school systems in Nassau County were Hempstead, North Merrick and Roosevelt. Suffolk County's list consisted of Bay Shore, Greenport, Middle Country, New Suffolk, South Huntington and Three Village.
The comptroller's office each year uses three designations — significant stress, moderate stress and susceptible to stress — as part of its system of evaluating districts' economic condition. Designations are applied to public schools when they are starting to put together budget proposals for fiscal years starting July 1.
Most "susceptible" ratings on the Island stemmed from an increase in short-term borrowing last year by districts that feared they might lose state financial aid due to an economic downturn triggered by the COVID-19 pandemic. Concerns subsided in April, however, when state lawmakers raised income-tax rates on millionaires and used much of the extra revenues to boost the Island's aid 13%.
Some school administrators contended Thursday that they no longer faced financial risk.
South Huntington's superintendent, Vito D'Elia, messaged Newsday that his district was in "strong fiscal standing" thanks in large part to state aid increases.
Steven Maloney, the Bay Shore schools chief, declared that "we were made whole with state aid and the anticipated cash flow difficulties did not materialize."
Hempstead's superintendent, Regina Armstrong, noted that her district has moved up a notch in financial categories since this time last year, when the system was rated in moderate fiscal stress.
"Although the district's fiscal rating has improved, we are looking to continue on this trajectory until we are stress free," Armstrong stated.
New Suffolk, located on the Island's bucolic North Fork, faces a particular issue. The district is tiny, with about 13 students in its single elementary school and 14 older students who attend high school in nearby Southold on a tuition basis.
Tony Dill, president of New Suffolk's school board, said his district experiences frequent cash shortages due to fluctuating expenses — for example, a bigger-than-normal influx of teenage students whose tuition bills must be paid. He added that state law prohibits the district from accumulating enough reserves to meet such costs.
"It happens every year," Dill said.
Ratings serve as an early alert for district voters who must approve spending proposals before such plans go into effect. This year's voting on school budgets and board trustees is scheduled for May 17.
Ratings of "significant" stress — the most serious category — were applied to only two systems, both outside the Island. They were East Ramapo in the mid-Hudson region, and Newfield in the state's Southern Tier region. No districts met the state's criteria for "moderate" stress in the latest ratings.
State Comptroller Thomas DiNapoli, in releasing the fiscal-stress report, noted that the statewide list of 23 districts identified for the school year ending June 30, 2021, was down from 31 systems named the previous year. Long Island's list of nine was up from the prior year's list of six.
"Fewer of New York's school districts were scored as under fiscal stress in 2021, but the operational issues caused by the pandemic for all school districts was extreme," DiNapoli said in a statement. "School districts must watch their finances closely as the pandemic continues, prices rise and staffing issues mount."
Comptroller's ratings are based on a combination of strictly financial criteria, such as the strength of districts' reserve funds, as well as factors beyond a district's control, such as the number of low-income families served in the community. The current report is based on financial data received from districts as of June 30.
John Hildebrand is Newsday's senior education writer and has covered school news and policy issues affecting Long Island for more than 40 years.
