Ninety school districts, more than 13 percent of districts statewide, have been designated as fiscally stressed under New York State Comptroller Thomas P. DiNapoli’s Fiscal Stress Monitoring System. DiNapoli’s office evaluated 672 school districts with fiscal years ending on June 30, 2014.

This is the second year DiNapoli’s office has assessed and scored the financial stability of school districts. The second round of scoring designated 10 school districts in “significant fiscal stress,” 27 in “moderate fiscal stress” and 53 as “susceptible to fiscal stress.” Last year, a total of 87 districts were listed in fiscal stress.

“School districts are the hearts of many of our communities, but they face fiscal pressures that are unlikely to change any time soon,” said DiNapoli. “Although the increases in fiscal stress are relatively minor, the same problems persist, including increased deficits and dwindling fund balances. I urge school officials, especially those overseeing districts with deteriorating fiscal health, to use these scores as an impetus for more deliberate and careful long-term budget planning.”

Using financial indicators that include year-end fund balance, short-term borrowing and patterns of operating deficits, the monitoring system creates an overall fiscal stress score which classifies whether a district is in “significant fiscal stress,” in “moderate fiscal stress,” is “susceptible to fiscal stress,” or has “no designation.”

The ten school districts that were classified in “significant stress” were: Wyandanch Union Free School District (Suffolk County); Niagara-Wheatfield Central School District (Niagara); East Ramapo Central School District (Rockland); Lawrence Union Free School District (Nassau); Watervliet City School District (Albany); Copiague Union Free School District (Suffolk); Lewiston-Porter Central School District (Niagara); West Seneca Central School District (Erie); Hempstead Union Free School District (Nassau); and the Peekskill City School District (Westchester).

The scores are based on financial information submitted as part of each district’s ST-3 report filed with the State Education Department, as of Dec. 31, 2014. Today’s announcement does not include scores for the dependent school districts in the “Big Four” cities of Buffalo, Rochester, Syracuse and Yonkers. Information for these districts will be incorporated into the scoring for their respective cities later this year.

More than half of the school districts identified as fiscally stressed this year appeared in one of the three levels of stress last year. Additionally, 17 districts had increases of 25 percentage points or more in their total fiscal stress scores. The most dramatic increase was in the Hempstead Union Free School District in Nassau County, which saw a 65 percentage point increase in its fiscal stress score.

Other districts that experienced a 50 percent or more spike in scoring include: the Fulton City School District (Oswego County), Glens Falls Common School District (Warren), Johnson City Central School District (Broome), Peekskill City School District (Westchester) and the Wyandanch Union Free School District (Suffolk).

According to a research report issued today with the fiscal stress scores, school districts found to be in fiscal stress share a number of common characteristics. Most are operating with low fund balance, a pattern of operating deficits and limited cash on hand. In addition, DiNapoli’s office found high-need urban/suburban school districts were four times more likely to be in fiscal stress than low-need districts.

The report also noted a number of significant improvements among certain school districts. For example, the Kiryas Joel Village Union Free School District in Orange County experienced a 50 percent decrease in its fiscal stress score.

Eleven other districts saw a drop of 25 percentage points or more, including: the Elmira City School District (Chemung County), Gananda Central School District (Wayne), General Brown Central School District (Jefferson), Hudson City School District (Columbia), Maine-Endwell Central School District (Broome) and the Tupper Lake Central School District (Franklin).

DiNapoli’s report also highlighted:

• Regions with the highest number of stressed school districts were Long Island (19 districts);the Capital District (12); Western New York (12); the Southern Tier (11) and Central New York (11);
• More than 80 percent of school districts statewide were not in a fiscal stress category in either 2013 or 2014;
• Four districts dissolved and two were newly created in 2014. These districts were not evaluated;
• High-need rural districts in fiscal stress increased by nearly 3 percentage points; and
• Operating deficit was the indicator with the largest year-to-year change. This year, 28 percent of districts received a lower score on this indicator (showing less fiscal stress), while 19 percent scored higher (indicating increasing fiscal stress).

For a list of school districts in fiscal stress, visit:
https://www.osc.state.ny.us/sites/default/files/local-government/documents/pdf/2020-04/2014-schools-stressed.pdf

For the complete list of school district fiscal stress scores, visit: 
https://www.osc.state.ny.us/sites/default/files/local-government/documents/excel/2020-04/2014-schools-summary.xls

For a copy of the fiscal stress commonalities report, visit:
http://www.osc.state.ny.us/localgov/fiscalmonitoring/pdf/2015_SummaryResultsSchoolDistricts.pdf