Our public schools deserve better
After months of contentious budget negotiations, the State Legislature and Gov. Kathy Hochul recently agreed to a historic $237 billion state spending plan.
The final budget compromise included the Legislature’s reversal of Hochul’s proposed funding cuts to education, as it instead allocated nearly $36 billion in public-school aid.
The state’s public-school funding model can best be described as a three-legged stool consisting of state aid, commercial taxes, and residential property tax revenue. But even as New York makes historic investments in our schools with taxpayer dollars, many corporations and commercial properties are skipping out on their fair share of tax payments, leaving residents to pick up the hefty tab for education costs.
According to a 2023 report, public schools in the state lost at least $1.8 billion in revenue to corporate tax breaks, also known as tax “abatements,” in fiscal year 2021. Nassau County ranked among New York’s top 10 counties in total forgone school revenue, and recorded the second-highest number of approved corporate net tax exemptions.
The independent report, published by Good Jobs First, a pro-economic development research organization, found that a massive portion of corporate tax abatements occur when local industrial development agencies acquire properties and lease them to private companies in exchange for payments in lieu of taxes. Of course, these PILOTs are only a fraction of the corporate tax revenue that would help fully fund our education system.
Let’s recap: Industrial development agencies, which are essentially public entities, buy up properties and offer them tax-free, for pennies on the dollar, to private companies, resulting in billions of dollars in lost commercial tax revenue for school districts across the state.
According to this analysis, the lost revenue for Nassau County public school districts included $3 million — or $1,031 per pupil — for the Mineola Union Free School District, $8.4 million — $1,668 per pupil — for the Westbury Union Free School District, and $12.6 million — $1,827 per pupil — in the Uniondale Union Free School District, the highest in Nassau County and the third-highest among public schools statewide.
The estimated $1.8 billion in lost school budget revenue could have been used for such essential investments as air conditioning in classrooms, athletic field renovations, wages for bus drivers, and teacher training for new technology.
Last year, the State Legislature introduced a bill that would prohibit IDAs from granting corporate tax breaks and PILOTs where tax revenue was intended for public school districts. The bill has gained significant support from labor organizations, teachers unions and good-government groups seeking to reform IDAs to better serve our schools.
Fundamentally, the Good Jobs First report argues, IDAs should not have the power to waive commercial taxes that would otherwise benefit our schools. The report makes key policy recommendations toward this end, including expanding school and community representation on IDA boards, increasing transparency and accountability in reporting forgone tax revenues, and eliminating IDAs entirely.
In Nassau County, residents pay among the nation’s highest property taxes, 60 percent of which are earmarked for our public schools. But if we are to achieve a fairer, more equitable education and tax system, we cannot continue to allow corporations to shortchange our school districts at the expense of hardworking families.
Karl A. Valere is chief of staff and senior policy adviser to Assemblyman Khaleel M. Anderson. He lives in Baldwin.
