Cuomo’s Choice: Tax the Rich or Starve the Schools

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New York State Governor Andrew Cuomo. (Photo by Lev Radin/Sipa USA via AP Images)

New York City is facing its most tumultuous school reopening in recent memory. The city’s Department of Education is the only major urban school system that is attempting to start the new school year with in-person learning, and the move will offer either a roadmap for districts everywhere or serve as a cautionary tale of what a city should not do. As of now, the DOE plans to reopen in-person instruction on September 21, delaying a start date from September 10 after teachers, fearing for their lives, began to talk openly about striking.

The city’s bumbling mayor, Bill de Blasio, has emerged as the usual villain of the narrative, with parents and teachers alike deeply frustrated over his Department of Education’s confusing reopening plan. And De Blasio’s sins are many: expecting schools to implement an elaborate, in-person learning program while slashing more than $700 million from the education budget; sending kids and staff into buildings without adequate ventilation; failing to test all students and teachers for coronavirus before the start of school; rolling out an innovative outdoor learning plan far too late into the summer; and dragging his feet on a promise to install a nurse in every school building.

But it is America’s most famous governor, Andrew Cuomo, who looms far larger over the future of public education in New York in the age of Covid-19. It is Cuomo, who won undeserved plaudits for his daily Covid-19 press briefings as more than 32,000 New Yorkers died from the virus, who holds the financial key to the success, or failure, of the city’s school reopening experiment. And for the last few months he has been using that key to threaten to restrict essential funding to the state’s schools.

As governor, Cuomo controls a significant number of purse strings: of the DOE’s $34 billion budget, more than a third is provided by New York State. Since the pandemic began in March, Cuomo has won extraordinary new emergency powers over the state budget, able to make rolling cuts throughout the year as tax revenue dissipates from coronavirus-induced shutdowns. An ardent opponent of taxing the rich to fill budget deficits, Cuomo has instead insisted on austerity, threatening massive cuts to public schools across the state.

And while all school districts would suffer, a troubling, a new report from the Alliance for Quality Education, a progressive education advocacy group, found that extending the 20 percent cuts in state aid would have been most devastating for schools serving the working class and poor—which is a particular concern for New York City schools, which represent the poorest students in the state and serve an overwhelmingly nonwhite population. AQE found that Cuomo’s threatened cuts would mean high-need school districts, like New York City’s, would endure a $2,616 reduction per student, while wealthier districts would lose $873 per student.

As it is, New York City schools are already beginning to feel the pinch.

“The governor has started to withhold funding aid for localities and, if the state doesn’t receive additional federal stimulus, all or a portion of these withholdings will become permanent depending on federal aid,” said Katie O’Hanlon, a DOE spokeswoman. “While we do not yet know how this will impact DOE’s budget, cutting billions of dollars from the city’s education budget would be devastating.”

To understand how Cuomo came to threaten the schools with such broad, sweeping cuts, it helps to rewind the clock a few months. New York City’s economy has been in freefall since Covid-19 first hit. The unemployment rate has hit about 20 percent, with reliable industries central to the city’s identity, like hospitality and tourism, greatly hobbled. Meanwhile, the state faces an estimated $30 billion budget deficit over the next two years. Economists and local leaders agree New York cannot return to its pre-pandemic strength until the federal government bails out the state with tens of billions of dollars.

The problem is that Donald Trump and Senate Majority Leader Mitch McConnell have not supported any bailout for localities, including New York, and all signs indicate that no federal aid will come to the rescue before November. However, Cuomo insists that federal aid is the only way to save the schools, transportation networks, hospitals, and other essential services. While federal aid is crucial, Cuomo’s insistence on relying solely on federal relief has meant that he refuses to entertain one of the only other means of avoiding massive budget cuts: raising taxes.

Since earlier this summer, a corps of activists, policy advocates, and political leaders—including Representative Alexandria Ocasio-Cortez and leading Democrats in both chambers of the state legislature—has been urging Cuomo to raise taxes on the rich. Their proposals include a billionaires’ tax to create a fund for workers excluded from typical government relief; an ultra-millionaires’ tax for education funding; and a host of other proposals that advocates say could raise as much as $35 billion a year.

Cuomo has so far resisted these calls, insisting that any attempt to raise taxes on the rich will only cause them to flee the state: “I literally talk to people all day long who are in their Hamptons house who also lived here, or in their Hudson Valley house or in their Connecticut weekend house,” he told reporters in August. And he added: “You know what … they’re thinking? If I stay there, I pay a lower income tax because they don’t pay the New York City surcharge.”

Yet, history suggests the governor may not be right. After September 11, New York’s billionaire mayor, Michael Bloomberg, successfully raised property taxes in New York City to fill budget gaps. David Paterson, one of Cuomo’s predecessors, proposed hiking taxes on millionaires statewide after the 2008 economic crash. More recently, Cuomo, a Democrat, was out-progressive’d by at least one prominent Republican: Mike DeWine. The Ohio governor saved his largest education cuts for Ohio’s wealthier suburban school districts.

For public education advocates, the governor’s refusal to raise taxes to save the state’s schools is alarming but not without precedent. They have been wary of Cuomo for years. A longtime supporter of charter schools, the governor has sought, at varying times in his tenure, to reduce spending on public schools. Indeed, Cuomo took aim at New York City public schools as recently as April, when a recently passed state budget included $716.9 million in federal aid, courtesy of the CARES Act Congress approved in March. Immediately, Cuomo slashed the exact same amount in state aid to the city’s school budget.

“New York City got shafted more than any other school district,” said Leonie Haimson, the executive director of the public education advocacy group, Class Size Maters.

Jasmine Gripper, the executive director of Alliance for Quality Education, offered an even more blunt assessment. “Cuomo has failed to protect public schools and public-school students,” she said. “He has not prioritized the needs of Black and brown children across New York State for the entire tenure of his governorship. He has consistently failed to prioritize education and consistently failed to protect our public schools.”

Gripper’s outrage stems, in part, from events that go all the way back to Cuomo’s earliest months on the job. When Cuomo took office in 2011, he immediately battled back against a 2006 court ruling that required New York State to provide more funding to public schools to meet state constitutional requirements. In 2007, the State Legislature had devised a formula to fund needy schools, known as Foundation Aid, that promised billions in additional cash. One of Cuomo’s predecessors, Eliot Spitzer, was initially committed to increasing Foundation Aid, but his tenure was cut short when a prostitution scandal forced him from office in 2008.

Cuomo, unlike Spitzer, has disputed the lawsuit’s funding requirements. Advocates have argued he owes schools statewide at least $4 billion. A new lawsuit, New Yorkers for Students’ Educational Rights (NYSER) v. State of New York, is underway to force Cuomo to redirect more funding to the state’s poorest school districts.

Attorney General Letitia James, a close Cuomo ally, has retained a version of the same law firm Atlanta-based law firm, Eversheds Sutherland, that New York State hired to combat the last lawsuit when Republican George Pataki was still governor.

Michael Rebell, the lead attorney for NYSER who also led the previous lawsuit, known as the Campaign for Fiscal Equity, said New York City schools have developed newer and greater needs since 2006, including adjustments for the pandemic and a skyrocketing homeless population.

“There are obviously going to be a lot of costs involved in retrofitting school buildings and training teachers to deal with remote learning. There’s going to be a huge need for remediation, to give kids a sound basic education,” said Rebell, who is also the director of the Center for Educational Equity at Teachers College, Columbia University. “The [state] constitution doesn’t go on hold because there’s a recession or COVID-19 possibility.”

For now, however, and despite postponing major cuts until after the election, Cuomo remains no closer to budging on his no-new-tax pledge than he was in the early summer, when calls first began to build for new revenue streams for New York. A spokesman for Cuomo’s budget division, Freeman Klopott, said in a statement that only federal funding could save local governments from draconian education cuts. It’s the same refrain the governor has been singing all along.

“In the absence of federal funding to offset revenue losses, we’re concerned about funding for schools, hospitals, fire departments, and services supporting our most vulnerable neighbors, and that’s why we have been calling on the federal government for five months to act,” Klopott said. “The withholding is temporary, pending the funding the federal government will ultimately provide, which will determine the level of funding available for all services that support our schools and most vulnerable New Yorkers.”

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