New York State will receive a $3 billion windfall from the $9 billion that the French bank BNP Paribas must pay for violating sanctions on transferring money to Sudan, Cuba, and Iran. The state senate has begun brainstorming how the money should be spent including accelerating tax cuts and phasing out utility taxes.
Claiming that a statute that allows the state to deduct over $ 1 billion from amounts that the state funding formula calculates to be due to school districts is “unconstitutional on its face,” the plaintiffs in NYSER v. State of New York filed a motion for a preliminary injunction late last month that asks the court to restore the $1 billion immediately, even before the case goes to trial. The complaint in the case, filed in February, seeks to compel the state to fully comply with the orders of the New York Court of Appeals in CFE v. State of New York and with Article XI § 1 of the State Constitution that guarantees all students the right to the opportunity for a sound basic education. The full relief that plaintiffs seek could amount to over $5 billion.
In the Preliminary Injunction Motion, the plaintiffs challenge a “gap elimination adjustment” (GEA), a budgetary device the state uses cover the “gap” between what is due to the schools and the state’s available revenues. Plaintiffs are also claiming that a cap on the amount that the education budget can be increased each year and a supermajority voting requirements that essentially “caps” any property tax increases over 2% or the last year’s inflation increase, whichever is lower, also are facially unconstitutional. The argument is based on the Court of Appeals’ holding that the state is obligated to provide schools the “actual cost” of a sound basic education.
The defendants have made an immediate motion to change the court in which the motion will be heard from New York City to Albany. Plaintiffs are resisting that change. The Court has set will hear arguments on the change of venue motion on July 29, 2014.
The NYSER plaintiffs include nine New York City parents, eight parents from other urban, suburban and rural districts throughout the state, and New Yorkers for Students Educational Rights (“NYSER”), an unincorporated association whose members include 11 of New York City’s 32 community education councils, the New York State School Boards Association, the 2 New York State Council of School Superintendents, the New York State PTA, the New York State Association of School Business Officials, the Statewide School Finance Consortium, the Rural Schools Association and a variety of parent and educational advocacy groups.
The defendants are the State of New York and Governor Andrew Cuomo, the State Board of Regents, and John B. King, Commissioner of Education.