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2002
   
 
New York City
August 2002


Report Card on School Year Spending

While the majority of the citys 1.1 million students have put away their schoolbooks for the summer, the Board of Educations (BOE) budget books remain open and under scrutiny. Based on current information, the Independent Budget Office (IBO) projects that when the boards books are closed they will show a modest $150 million increase in spending during city fiscal year 2002. This increase 1.3 per cent over the previous year was less than the rate of inflation. The 2002 spending boost stands in contrast to the previous four years, a period in which city, state and federal funding expanded the education budget by $3.5 billion an average yearly increase of 9.4 percent.

Last years spending increase proved inadequate to keep up with rising costs, especially for teachers and other staff. In response, BOE imposed per-student spending cuts and took steps to reduce other costs.

The mandatory cost increases the board faced in city fiscal year 2002 were $262 million
for salary increases (after the new teachers contract), $58 million for increased health insurance premiums and $15 million in cost-of-
living allowances for pupil transportation contracts. The BOE also incurred significant expenses as a result of the attacks on the World Trade Center, including relocation costs for Lower Manhattan school and crisis counseling expenditures throughout the system.  Conversely, it is estimated that the board saved some $32 million as a result of a drop of 7,100 students system-wide and the correlated decrease in staffing needs.#

Independent Budget Office (IBO)

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Education Update, Inc., P.O. Box 20005, New York, NY 10001.
Tel: (212) 481-5519. Fax: (212) 481-3919.Email: ednews1@aol.com.
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