2007-2008 NEW YORK STATE EXECUTIVE BUDGET
EDUCATION, LABOR AND FAMILY ASSISTANCE
ARTICLE VII LEGISLATION
MEMORANDUM IN SUPPORT

CONTENTS

MEMORANDUM IN SUPPORT

A BUDGET BILL submitted by the Governor in
Accordance with Article VII of the Constitution

AN ACT to amend the education law, in relation to uniform quality standards for pre-kindergarten programs, the review of regents learning standards, the development of an enhanced accountability system, establishing a distinguished educator program, the development of a school leadership report card, tenure determinations, and requiring certain schools to prepare contracts for excellence (Part A); to amend the arts and cultural affairs law, in relation to designating a member of the board of regents to serve on the New York state cultural education trust; to amend the education law, in relation to authorizing the commissioner of education to expend money for formula grants to public library systems in the 2007-2008 state fiscal year, special education classification reviews, the textbook factor and the library materials factor for the 2007-2008 school year, the amount annually appropriated for general support for public schools commencing with the 2011-2012 school year, the determination of selected actual evaluation, the computation of pupil counts and related factors, apportionment of public moneys to certain school districts, transitional aid for charter school payments, the universal pre-kindergarten program, charter schools, full-day kindergarten transition planning grants, supplemental educational improvement grants and the excelsior scholars program for certain students; to amend the state finance law, in relation to the state lottery fund; to amend chapter 756 of the laws of 1992, relating to funding a program for work force education conducted by the consortium for workers education in New York city, in relation to certain reimbursements and the effectiveness of such chapter; to amend chapter 169 of the laws of 1994, relating to certain provisions related to the 1994-95 state operations, aid to localities, capital projects and debt service budgets, in relation to the effectiveness thereof; to amend chapter 82 of the laws of 1995, amending the education law and certain other laws relating to state aid to school districts and the appropriation of funds for the support of government, in relation to the effectiveness thereof; to amend chapter 472 of the laws of 1998, amending the education law, relating to the lease of school buses by school districts, in relation to the effectiveness thereof; to apportionment of monies appropriated for the support of public libraries; to establish the school district efficiency review program; to provide for special apportionment for salary expenses; to provide special apportionment for public pension accruals; in relation to suballocation of certain education department monies; to establish a temporary task force on preschool special education; to repeal certain provisions of the education law relating to annual apportionments to school districts; and providing for the repeal of certain provisions upon expiration thereof (Part B); to amend the education law, in relation to providing additional mayoral involvement in school governance in certain cities (Part C); to amend the real property tax law and the tax law, in relation to establishing a “Middle Class STAR” program; to amend the administrative code of the city of New York, in relation to credits against tax; to amend the state finance law, in relation to reimbursement payments to the city of New York; and to repeal certain provisions of the real property tax law and the tax law, relating to a local real property tax rebate and a state income tax credit (Part D); to amend the education law, in relation to eligibility requirements and conditions governing awards and loans (Part E); in relation to the discontinuance of services and operations at specified residential programs operated by the office of children and family services (Part F); to amend the state finance law, in relation to establishing the youth facility per diem account; and to amend the executive law, in relation to the reimbursement owed to the state by the social services districts for expenditures made by the office of children and family services for the care, maintenance and supervision of youth in office facilities and programs (Part G); in relation to preventive services funding (Part H); to amend part C of chapter 83 of the laws of 2002 amending the executive law and other laws relating to funding for children and family services, in relation to making the provisions of such part permanent (Part I); to amend the executive law, in relation to establishing the office for the blind and in relation to establishing vending programs; to repeal chapter 693 of the laws of 1992 relating to establishing a vending program for the blind and visually handicapped; to repeal chapter 415 of the laws of 1913, relating to establishment of a state commission for the blind and visually handicapped; and to repeal section 38 of the social services law relating to removing the state commission for the blind and visually handicapped as a bureau of the department of family assistance (Part J); and to improve performance and provide flexibility in the allocation of temporary assistance for needy families (Part K)

PURPOSE:

This bill contains provisions needed to implement the Education, Labor and Family Assistance portions of the 2007-08 Executive Budget.

SUMMARY OF PROVISIONS, EXISTING LAW, PRIOR LEGISLATIVE HISTORY AND STATEMENT IN SUPPORT:

Part A – Strengthen educational accountability by establishing measurable performance targets, promoting strong educational leadership, and raising standards

This bill enacts comprehensive education reforms for tracking and improving student and teacher performance through results-oriented measurements. Deficiencies will be identified from analysis of student/teacher performance data, and this information will be used to determine when intervention and sanctions are necessary.

This bill enacts numerous changes to the State Education Law to ensure sound, basic pre-K through secondary educational preparation for college or employment. It implements the Court of Appeals’ Campaign for Fiscal Equity decision, and furthers compliance with the mandates of federal education law, including the “No Child Left Behind Act”.

Several key issues are addressed, including:

Higher Standards: Uniform standards will be established for pre-kindergarten programs, including curriculum and teacher certification requirements. The Board of Regents will continue to review the adequacy of existing Regents Learning Standards, and the English Language Arts standards review will be completed by July 2008.

Enhanced Accountability: By July 2008 student progress reports reflecting multiple years of testing will be required. Moreover, if federal approval is received, a cumulative enhanced accountability system for individual student academic growth, linked to individual teachers, will be required by July 2010.

“School leadership” and “school progress” report cards that reflect the performance of schools, as well as superintendents and other school district leadership, will be made available to the public and the State Education Department. School superintendents, the Chancellor of the New York City schools, and school boards will be subject to removal for persistent deficient performance of schools in their districts. A cadre of “distinguished educators” will be designated by the Commissioner of Education to assist in improving troubled schools.

By July 2008, improvement targets for schools and districts will be tightened so that up to 5% of all schools will be required to restructure and reorganize. All school districts that receive a supplemental educational improvement plan grant or significantly increased financial support under the new Foundation Aid formula will be required to submit a “contract for excellence,” which details how schools’ expenditures of increased aid will be targeted to implement or expand programs demonstrated to improve student achievement, including class size reduction, increased student time on task, teacher quality initiatives, middle and high school restructuring and full-day prekindergarten. School districts must involve the public and other interested parties in the development of their contracts for excellence, which must also include financial details on per pupil expenditures.

Teacher Quality Standards: The Board of Regents will review the effectiveness of post-secondary teacher preparation programs, and expand alternative means for certification. Statutory standards are established for tenure determinations, which include whether the teacher adequately contributes to the academic success of students. Additionally, the Commissioner will identify incentives to encourage highly qualified teachers to work in low performing schools.

Part B – Reform the State’s education finance system through the establishment of a Foundation Aid formula, expansion of pre-kindergarten and other changes necessary to implement the four-year Educational Investment Plan

Reform the State’s education finance system.

This bill would amend existing law to: advance reforms to public school finance through the creation of Foundation Aid; expand Universal Prekindergarten and other early childhood education initiatives; expand the availability of charter schools by increasing the limit on the number of such schools and providing transitional aid to districts impacted by a concentration of charter schools and provide for reforms to special education programs.

Foundation Aid: This bill would amend Education Law to establish Foundation Aid which will replace 30 aid formulas. Education Law would be amended to specify the factors necessary to calculate Foundation Aid for school districts including the following:

• Foundation Amount: This bill would specify a standard local education cost based upon actual costs in successful schools, adjusted for geographic cost differences and educational need factors including students at risk due to poverty, limited English proficiency, and special education needs;
• Expected Local Contribution: This bill would establish an expected—but not mandated—local contribution, adjusted to reflect district income wealth;
• Phase-in Factor: This formula would be phased in over 4 years, starting in the 2007-08 school year with the incremental phase-in amount each year specified in the law;
• Student Count: This bill would define the student count used to allocate funds based upon enrollment, rather than attendance;
• Minimum Increase: This bill would ensure that all school districts receive a Foundation Aid increase of at least 3 percent;
• Foundation Aid conforming changes: This bill would address a large number of conforming changes to reflect the new Foundation Aid, and update section references related thereto.

Big Four Cities Maintenance of Effort: This bill would ensure the Big 4 Cities (Buffalo, Rochester, Syracuse, and Yonkers) use additional State aid to supplement and not supplant local support.

Universal Prekindergarten Program: This bill would amend Education Law to establish a formula that would provide State funding to support expansion of the Universal Prekindergarten program. Under this formula, the Foundation Amount per pupil would be used in the computation of Universal Prekindergarten Aid to reflect school district wealth and student educational needs. Similarly, a number of amendments are made to existing program planning requirements to facilitate timely implementation of the expansion of this program.

Full-Day Kindergarten Program: This bill would require high-need or low-performing districts, as determined by the Commissioner, to offer Full-Day Kindergarten programs for all children in those districts by 2010-11.

Charter Schools: This bill would amend Education Law regarding charter schools in the following areas:

• Charter School Cap: The existing cap of 100 schools would be increased by 150 schools with SUNY, the Board of Regents and the NYC Schools Chancellor each authorized to approve 50 new charter schools;
• Charter School Transitional Aid: This bill would amend Education Law to establish a new formula that would provide transitional aid to districts that have a concentration of charter schools; and
• Expanded Notification Requirements: This bill would require the Regents to take action on the issuance of a charter by March 15 of each year in order for the charter school to open in the following September, thus allowing the school district to be notified of a new charter school prior to the adoption of its budget.

School Efficiency Reviews: This bill would establish a new school district efficiency review program to assist school districts in identifying administrative and other operational savings that could be reinvested to support classroom instruction and minimize property tax growth. Performed by management consultants under contract with the State, the reviews are intended to be voluntary based upon requests from school superintendents. All costs would be fully supported by the State from a recommended $5 million appropriation in the 2007-08 Executive Budget.

Special Education: To focus greater attention on special education services, this bill would amend Education Law to:

• Create a Taskforce on Preschool Special Education that would review the relationship between preschool special education and other early childhood programs as well as different financing approaches; and
• Require school districts with high special education classification rates or with excessive referrals to special education by race/ethnicity to address these deficiencies.

Other Miscellaneous Provisions: Other provisions of this bill would make various changes to Education Law, miscellaneous school aid provisions and other education programs.  These changes include:

• Excelsior Scholars Program: This bill would create an Excelsior Scholars program that would recognize and reward talented middle school students in the areas of math and science and provide summer enrichment programs at college campuses throughout the State;
• Aid Payment Schedule Changes: This bill would conform current School Aid payment schedules to reflect the new Foundation Aid. It also would establish a payment schedule for School Aid payments made through the Video Lottery Terminal (VLT) account;
• Increasing Textbook and Library Materials Aids: This bill would make minor adjustments in the per student grant amounts for both Textbook Aid and Library Materials Aid;
• Building Aid: This bill would make permanent the payment reforms previously enacted for new school facility projects; and
• Supplementary State Aid for Public Library Systems: This bill would continue supplementary State aid for public library systems at 2006-07 levels and would amend the payment schedule for library construction aid.

Part C – Ensure that the mayors of Syracuse, Rochester and Buffalo are represented on their local school boards

This bill will further the goal of enhanced school district accountability by authorizing the mayors of Buffalo, Rochester and Syracuse to appoint two members to the school board, to serve at the pleasure of the mayor.

This bill amends sections 2552 and 2553 of the Education Law to increase the size of the school boards in three of the “Big Five” cities, by authorizing the mayors of those cities to appoint two of the members of the school board. The school boards in two of the “Big Five” cities would not be affected by this legislation. The school board in New York City is governed by a separate statute and is already under mayoral control, and the mayor of Yonkers appoints the school board pursuant to section 2553(3) of the Education Law.

Sections of the Education Law governing elected school board members, including the number of individuals that serve in elected school board positions, remain unchanged. The number of school board members in Buffalo would increase from nine to eleven, and board size would increase from seven to nine members in Rochester and Syracuse. Appointed school board members will be required to meet residency and citizenship requirements applicable to elected school board members.

Part D – Enhance the School Tax Relief (STAR) Program by increasing funding and targeting the benefits to low and middle class homeowners

To establish a new “Middle Class STAR” program, providing greater school tax relief to New York State’s middle class homeowners.

In recent years, the crushing local property tax burden has become the number one concern of homeowners throughout New York State. While the impact of ever-increasing local taxes has been cushioned somewhat by the School Tax Relief (STAR) program enacted in 1997, the basic STAR program is flawed to the extent that, except for seniors, it fails to take into account the owner’s ability to pay. The program will be restructured to concentrate relief for those taxpayers who need it the most by establishing a “Middle Class STAR” program that (1) expands the Basic STAR Exemption for homeowners by up to 100 percent by 2009-10, depending on income, (2) expands the Enhanced STAR Exemption for qualifying senior citizens, and (3) expands the Personal Income Tax Credit for eligible taxpayers in New York City.

The Basic STAR Exemption will be increased with funds targeted to middle class homeowners based upon their incomes. The income brackets for eligible homeowners will be indexed in future years to reflect growth in average wages. In most areas of the State taxpayers whose incomes are at or below $60,000 (adjusted for inflation) will see their Basic STAR exemption increased by 80 percent of the $30,000 base exemption in 2007-08, by 90 percent in 2008-09, and by 100 percent in 2009-10 and thereafter. For example, the exemption for a homeowner with an income of $70,000 (adjusted annually for inflation) will increase by 67.5% in 2007-08, by 75% in 2008-09 and by 82.5% in 2009-10 and thereafter.

In the downstate metropolitan region (which currently encompasses New York City and the Counties of Nassau, Suffolk, Westchester, Rockland, and Putnam), the Basic STAR exemption increases will be adjusted in recognition of the region’s higher income levels.

The Enhanced STAR Exemption will be increased for qualifying senior citizens by 30 percent in 2007-08 (from $56,800 to $73,800), and by another 10 percent in 2008-09 (to $79,500), with cost-of-living adjustments driven by the Consumer Price Index (CPI-W) in each year thereafter.

In New York City, the Personal Income Tax Credit for City taxpayers will also be increased substantially for middle class taxpayers. Generally, the New York City personal income tax credit for married individuals filing joint returns and surviving spouses will be increased from $230 to $300 for 2007, to $320 for 2008, and to $340 for tax years after 2008. For all other taxpayers, the credit will be increased from $115 to $150 for 2007, to $160 for 2008, and to $170 for tax years after 2008. However, for married individuals filing joint returns and surviving spouses with income of more than $235,000 (adjusted for inflation), the New York City personal income tax credit shall be limited to $230, and for all other taxpayers with income in excess of $235,000 the credit shall be limited to $115.

In terms of administration, the increases to the Enhanced STAR exemption provided under Middle Class STAR are self-executing. To take advantage of these increases, qualifying senior citizens who are already receiving the exemption and who are participating in the Income Verification Program (IVP) need do nothing further. Those who are receiving the exemption but are not participating in the IVP will only need to submit proof of their incomes to their local assessors annually, just as they must currently provide.

The increases to the Basic STAR exemption provided under Middle Class STAR cannot be self-executing because local assessors do not already possess the information needed to determine how much any given parcel’s exemption should be increased. Thus, to take advantage of these increases in 2007-08, Basic STAR recipients will need to file an application with the Department of Taxation and Finance by May 15, 2007 or, if filing electronically, by May 25, 2007. The Department of Taxation and Finance will mail informational notices to STAR-eligible property owners who received a 2006 local real property tax rebate check.

After receiving these applications, the Department of Taxation and Finance will determine which parcels are eligible for Basic STAR increases. Eligibility will be based upon the income of the primary owners, and of any primary owners’ spouses. The Department of Taxation and Finance will determine the extent to which these parcels are eligible for Basic STAR exemption increases, and will report these “benefit levels” to the Office of Real Property Services (ORPS). ORPS will relay the information it receives to the appropriate assessors, who will increase each Basic STAR exemption on the assessment roll to the extent indicated by the report, and the school tax bills of qualifying parcels will be lowered as a result. Optimally, this will all be accomplished before the 2007 assessment rolls are finalized, or at least before the 2007-08 school tax bills are issued, but where a parcel is entitled to a reduction which does not appear on the tax bill, the school district would be authorized to grant a refund or reduce any pending installment payments.

The determination of the income associated with each parcel will be performed only by the Department of Taxation and Finance. Assessors would not be empowered to make their own independent determinations for this purpose. Property owners who believe an unfavorable benefit level was assigned to them by the Department of Taxation and Finance would have the option of applying to the Department of Taxation and Finance for reconsideration. Property owners who fail or decline to file timely applications with the Department will not be entitled to increases in their Basic STAR exemptions.

To protect against the possibility that third parties might try to estimate the income of a property owner by observing how much of a Middle Class STAR exemption his or her home has been granted, the bill directs that this information shall be kept confidential, shall not appear on assessment rolls, and shall not be subject to disclosure under the Freedom of Information Law.

School districts would be compensated in full for the cost of the increased exemptions as they are now, through the existing STAR reimbursement mechanism, and New York City would be compensated in full for the cost of the increased Personal Income Tax Credit, through an amendment to State Finance Law §54-f.

The local real property tax rebate/credit program that was enacted in 2006 is rendered obsolete by this bill and is repealed.

Part E – Modify the Tuition Assistance Program (TAP) to reform eligibility criteria

This bill amends Tuition Assistance Program (TAP) eligibility requirements to promote improved academic performance and protect the investment of taxpayer funds in TAP.

Effective April 1, 2007, this bill:

• removes provisions otherwise allowing first time aid recipients without a high school diploma or its equivalent to receive aid in the 2007-08 academic year and thereafter through an ability to benefit (ATB) examination.
• requires that students receiving aid for the first time in the 2007-08 academic year, or thereafter, possess a high school diploma or its equivalent, or meet other academic standards or requirements, as determined by the Commissioner of Education.
• continues academic progress standards enacted in the 2006-07 budget and incorporates equivalent standards for institutions with trimester scheduling.

Effective July 1, 2007, this bill:

• requires that to be eligible for participation in State student financial aid programs, institutions must be approved for participation in federal student financial aid programs under Title IV of the Higher Education Act of 1965, as amended.
• maintains student eligibility for State student financial aid programs through the 2009-10 academic year for students matriculated at an institution that, on the date the bill becomes law, was operating in this State, but was not approved for participation in Title IV student financial aid programs.

Part F – Modify the notification requirement for closing youth facilities

This bill promotes fiscal and program efficiency by reducing excess capacity in youth facilities operated by the Office of Children and Family Services (OCFS).

This bill authorizes OCFS to close three community residential homes and one non-secure residential facility as of October 1, 2007. These facilities serve juvenile delinquents committed to the care and custody of OCFS by the family courts. OCFS would not be required to adhere to the existing statute’s closure notice requirement, which was increased from nine months to twelve months in 2006.

Community residential homes offer the least restrictive level of care for juvenile delinquents and primarily serve as a step-down before youth transition back into the community. The three homes proposed for closing are located in Gloversville, Mount Vernon and Brooklyn. The Gloversville home is vacant and the Mount Vernon and Brooklyn homes are underutilized, allowing their current population to be transferred, based on the program and security needs of each youth, into community-based programs or to non-secure facilities with available capacity. The Great Valley facility, a 25-bed non-secure facility, is recommended for closing because its location in Cattaraugus County is a long distance from the home community of most OCFS youth. Youth at Great Valley would be transferred, based on program and security needs, to other non-secure facilities or community-based programs. OCFS operates eighteen non-secure facilities that generally operate at about 80 percent of capacity. Therefore, sufficient capacity would remain to accommodate youth from Great Valley.

Community residential homes and 25-bed non-secure facilities are not major employers. Their closure will not have an adverse impact on local economies, and it is expected that many of the impacted employees will be eligible for transfer to other facilities.

Part G – Convert an Office of Children and Family Services’ (OCFS) internal account to a Special Revenue account to improve transparency

This bill fosters transparency in government operations by requiring that revenue from per diem billings to local governments for their share of the cost of Office of Children and Family Services (OCFS) youth facilities be deposited into a newly created account whose activity will be visible to the Executive, the Legislature, and the Comptroller.

This bill establishes a new Youth Facility Per Diem Special Revenue Other account for the receipt of per diem revenue from local governments.

Per diem revenues are currently deposited into an internal OCFS sole purpose account whose receipt and disbursement transactions are not visible to the Legislature or Executive staff outside of OCFS. The activity of the new special revenue account will be visible through the Office of the State Comptroller accounting system reports, allowing the Executive and Legislature to more effectively monitor account activity and make informed budget decisions about the account and per diem revenue.

Part H – Mandate performance-based contracting for preventive services

This bill promotes fiscal and program efficacy in preventive services by requiring local districts to implement performance or outcome provisions.

New York has a State-supervised, locally-administered social service system. Preventive child welfare services are provided to the most vulnerable residents and include an array of services to meet the unique needs of each child and family and to prevent out-of-home placement of children. Beginning with the enactment of Child Welfare Financing Reform in 2002 the State has reimbursed localities 65 percent of the costs of providing these services after Federal funding is applied. Although foster care placements have declined since this funding was put in place, the efficacy of these services, which are provided directly by localities or are contracted out to provider agencies, is, in many instances, unknown.

This bill requires local districts to implement performance or outcome based provisions, as outlined in subsequent regulations, for preventive services beginning January 1, 2008.

This bill is designed to require that local investments in this sensitive area positively impact the lives of those they serve. With total investments in this area eclipsing an estimated $400 million in the current year, there is also significant fiscal incentive to see that services achieve beneficial outcomes.

Part I – Permanently extend Child Welfare Financing Reform provisions set to expire on June 30, 2007

This bill makes permanent certain provisions related to funding for children and family services that are designed to keep families intact while encouraging expedited permanency for children in foster care.

Child Welfare Financing Reform, enacted in 2002, created three notable General Fund supported funding streams to support at-risk children and their families: (1) the Foster Care Block Grant; (2) an open-ended funding stream for preventive, protective and other child welfare services whereby the State pays 65 percent of all costs, net of Federal Assistance, with local social services districts paying the remaining 35 percent; and (3) a Child Welfare Quality Enhancement Fund.

Current Child Welfare Financing Reform provisions promote community-based services to keep families intact as well as to establish permanent placements for foster children as quickly as possible. The system provides for 65 percent open-ended State reimbursement to social services districts for the non-Federal share of child preventive, child protective, after care, independent living and adoption services and administrative costs, while capping reimbursement for foster care services. It also includes a Children and Family Services Quality Enhancement Fund to increase the availability and quality of children and family services programs through the testing of special initiatives and innovative models of service delivery.

In 2003, the Committee on Special Education (CSE) Reform was enacted to provide for enhanced school district responsibility in educational placements for children by shifting maintenance (i.e. room and board) cost shares from 50 percent State and 50 percent local to 40 percent State, 40 percent local, and 20 percent local school district. These amendments gave school districts a greater financial role in ensuring the appropriate placement of special education children.

Both the Child Welfare Financing Reform and CSE statutes are scheduled to sunset on June 30, 2007.

Effective April 1, 2007, this bill amends Social Services Law and State Finance Law to make Child Welfare Financing Reform and the CSE statute permanent.

If this bill is not enacted, foster care reimbursement would return to open-ended 50/50 State/local shares and preventive services delivered by counties would no longer be eligible for State reimbursement. Fiscal incentives to provide services to keep a family intact would shift to encouraging unnecessary out-of-home foster placements for children. School districts would no longer have a financial stake in the residential placement of their special education children.

Part J – Create a new, independent Office for the Blind and eliminate OCFS’s Commission for the Blind and Visually Handicapped

This bill is intended to better serve the interests of the blind. It enacts a new article 14-A of the Executive Law, which establishes a new Office for the Blind, under the guidance of an advisory executive board, and authorizes it to perform existing governmental functions associated with serving the blind.

This bill enacts a new Article 14-A in the Executive Law to establish a new Office for the Blind, which would seek to improve and develop services and programs for the blind. The functions of the Office for the Blind would be discharged by the Executive Director and a new fifteen member unsalaried executive board would be created to advise the Office. The members of the executive board would be appointed by the Governor and legislative leaders for five year terms.

The functions of the new Office for the Blind would include functions currently performed by the Commission for the Blind and Visually Handicapped (Unconsolidated Law section 8701 et seq.), which is currently under the jurisdiction of the Office of Children and Family Services (OCFS). The Office for the Blind would continue operating a program which licenses blind individuals as vendors on State property and would also oversee an existing loan program which loans money to people with disabilities for the purchase of assistive devices. Appropriations currently made within OCFS for the operation of the Commission for the Blind and Visually Handicapped would be transferred to the Office for the Blind. The bill ensures that employees of the Commission for the Blind and Visually Handicapped would be transferred to the new office.

Part K – Provide for performance measurements in Temporary Assistance for Needy Families (TANF) funded programs, and establish an allocation methodology for the TANF Flexible Fund for Family Service (FFFS)

This bill authorizes allocation of the Federal Temporary Assistance for Needy Families (TANF) block grant by delineating funding appropriated for the Flexible Fund for Family Services (FFFS).

The TANF Program was enacted as part of the Federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Public Law 104-193). The enactment of TANF ended the previously existing entitlement welfare programs and instead provided states with block grants and the opportunity to implement their own public assistance programs through use of supportive services intended to help recipients make the transition off public assistance. Beginning in SFY 2005-06, TANF funding typically allocated to local social services districts was consolidated into a single FFFS appropriation enacted as part of the Education, Labor and Family Assistance (ELFA) budget bill. This bill sets forth the specific allowed purposes of the TANF FFFS funds.

BUDGET IMPLICATIONS:

Part A – Strengthen educational accountability by establishing measurable performance targets, promoting strong educational leadership, and raising standards

Enactment of this bill is necessary to implement the 2007-08 Executive Budget, which includes an increase in aid to schools that will, over the next four years, total over $7 billion. This bill establishes mandates and measures of accountability that are essential to ensure that those funds are used effectively.

Part B – Reform the State’s education finance system through the establishment of a Foundation Aid formula, expansion of pre-kindergarten and other changes necessary to implement the four-year Educational Investment Plan

Enactment of this bill is necessary to implement the 2007-08 Executive Budget by establishing Foundation Aid and other provisions required in the Governor’s Four-Year Educational Investment Plan.

Part C – Ensure that the mayors of Syracuse, Rochester and Buffalo are represented on their local school boards

Enactment of this bill is necessary to implement the 2007-08 Executive Budget because it is expected to achieve greater local accountability in the use of public funds.

Part D – Enhance the School Tax Relief (STAR) Program by increasing funding and targeting the benefits to low and middle class homeowners

Enactment of this bill is necessary to implement the 2007-08 Executive Budget, which includes an increase of $1.5 billion for the Middle Class STAR program.

Part E – Modify the Tuition Assistance Program (TAP) to reform eligibility criteria

Enactment of this bill is necessary to implement the 2007-08 Executive Budget, and will result in TAP savings of $30 million on an academic year basis.

Part F – Modify the notification requirement for closing youth facilities

Enactment of this bill is necessary to implement the 2007-08 Executive Budget. It is estimated that closing the three community residential homes and one non-secure facility in October, 2007 will generate $1.2 million in 2007-08 savings, consistent with the Financial Plan. These 2007-08 savings could not be achieved with the current twelve month notice requirement because the current requirement would not allow the facilities to close until February, 2008, or just two months before the end of the 2007-08 State Fiscal Year.

Part G – Convert an Office of Children and Family Services’ (OCFS) internal account to a Special Revenue account to improve transparency

Enactment of this bill is necessary to implement the 2007-08 Executive Budget because it establishes a special revenue other account for the receipt of per diem revenue assumed in the Financial Plan. It is assumed that $96 million in revenues deposited in the account will be transferred to the General Fund.

Part H – Mandate performance-based contracting for preventive services

Enactment of this bill is necessary to implement the SFY 2007-08 Executive Budget. Since this bill requires local districts to implement performance or outcome based provisions, it is assumed that their program assessments will culminate in improved performance, and will generate an estimated $10 million in SFY 2007-08 State savings.

Part I – Permanently extend Child Welfare Financing Reform provisions set to expire on June 30, 2007

The 2007-08 Executive Budget assumes that current provisions remain in place. If provisions were to sunset, local governments would be forced to choose between supporting $200 million in unbudgeted costs and discontinuing vital preventive services, while the State would face over $100 million in unbudgeted costs from changes in foster care and CSE reimbursement.

Part J – Create a new, independent Office for the Blind and eliminate OCFs’ Commission for the Blind and Visually Handicapped

This bill would be fiscally neutral in SFY 2007-08, as all existing appropriations for OCFs’ Commission for the Blind and Visually Handicapped would be transferable to the new Office for the Blind. Modest cost increases may be possible in future years as the Office develops its agenda.

Part K – Provide for performance measurements in Temporary Assistance for Needy Families (TANF) funded programs, and establish an allocation methodology for the TANF Flexible Fund for Family Service (FFFS)

Enactment of this bill is necessary to implement the 2007-2008 Executive Budget because it provides the spending authority for $1 billion in TANF funds - approximately 42 percent of the total Federal block grant.

EFFECTIVE DATE:

Part A – Strengthen educational accountability by establishing measurable performance targets, promoting strong educational leadership, and raising standards

The bill is effective immediately.

Part B – Reform the State’s education finance system through the establishment of a Foundation Aid formula, expansion of pre-kindergarten and other changes necessary to implement the four-year Educational Investment Plan

This bill takes effect April 1, 2007, except that selected provisions take effect immediately or on other specified dates.

Part C – Ensure that the mayors of Syracuse, Rochester and Buffalo are represented on their local school boards

The bill is effective immediately.

Part D – Enhance the School Tax Relief (STAR) Program by increasing funding and targeting the benefits to low and middle class homeowners

The bill takes effect immediately.

Part E – Modify the Tuition Assistance Program (TAP) to reform eligibility criteria

Section 1 of the bill takes effect July 1, 2007 and sections 2 and 3 of the bill take effect on April 1, 2007.

Part F – Modify the notification requirement for closing youth facilities

This bill takes effect immediately.

Part G – Convert an Office of Children and Family Services’ (OCFS) internal account to a Special Revenue account to improve transparency

This bill takes effect immediately except that section 2 takes effect April 1, 2007.

Part H – Mandate performance-based contracting for preventive services

This bill takes effect immediately.

Part I – Permanently extend Child Welfare Financing Reform provisions set to expire on June 30, 2007

This bill takes effect April 1, 2007.

Part J – Create a new, independent Office for the Blind and eliminate OCFs’ Commission for the Blind and Visually Handicapped

The bill is effective 180 days after enactment.

Part K – Provide for performance measurements in Temporary Assistance for Needy Families (TANF) funded programs, and establish an allocation methodology for the TANF Flexible Fund for Family Service (FFFS)

This bill takes effect on April 1, 2007.