Source: http://www.p12.nysed.gov/mgtserv/faq/docs/non-resident_tuition_charges.html
Timestamp: 2018-02-25 00:02:39
Document Index: 208920657

Matched Legal Cases: ['art 174', '§ 2040', '§ 2040', '§ 2041', '§ 2042', '§ 2044', '§ 2045', 'ART 174', 'art 174', 'art 174']

NYSED / P-12 / SOMS / Educational Management Services / Non-Resident Tuition Charges
Non-Resident Tuition Charges
“Seneca Falls Formula”
Formula for calculating non-resident tuition charges first established in 1949 in Matter of Common School District No.8, Town of Fayette (70 State Dept. Rep. 69). It involved the Seneca Falls Union Free School District No. 1, and thus became known as the “Seneca Falls Formula”.
That decision first stated that the formula should be based on the total cost of instruction for all pupils in grades K-12, allocated proportionately among student categories, including grades 1-6 and grades 7-12.
Now set forth in Part 174 of the Regulations of the Commissioner of Education.
District-reported data, both revenues and expenditures, are used to calculate total costs among various student levels and categories of students (students with or without disabilities) that are then divided by the appropriate membership.
Such charges may not exceed the actual net cost of educating nonresident pupils.
If the accounting records of the district providing the education are not maintained in such a way as to indicate the net cost, then the district must follow the formula set forth in the Regulations.
Office of State Aid calculates a Non-Resident Tuition (NRT) rate for each district, both an estimated rate and an actual rate.
The estimated and actual rates are “maximum” rates.
The Commissioner has held that districts must use the state calculated rate unless their accounting records are sufficient to warrant a greater charge. Generally, districts have not been able to demonstrate that their own accounting records are sufficient to charge a rate greater than what the state calculates.
When a district is billing the parent of a non-resident student, the parent should not be charged more if their student is a student with a disability, even if it costs the district more to educate such student (1994 opinion letter from the Office for Civil Rights of the U.S. Department of Education). Contracts between districts may use the formula rates calculated for general education students and for students receiving special education programs.
Districts should reconcile the rates once the actual rates have been calculated after the end of the school year and then determine whether additional or reduced charges are warranted.
§ 2040. District meeting to authorize contract system. 1. Any school
district may decide by a majority vote of the qualified voters present
and voting at a district meeting:
a. To contract for the education of all the elementary pupils of such
district in another school district in this state or in any adjoining
state, instead of maintaining a home school.
b. To contract for the education of part of the elementary pupils of
such district in another school district in this state or in an
adjoining state and maintain a home school;
c. To contract for a period of not less than two and not more than
five years for the education of all the high school pupils of grades
seven to twelve, inclusive, of such district in another school district
in this state or in an adjoining state, instead of maintaining a home
high school for such grades.
d. To contract for a period of not less than two and not more than
five years for the education of some of the pupils of grades seven to
twelve, inclusive, of such district in another school district in this
state or in an adjoining state provided that such district maintains a
home high school for such grades. Nothing herein shall require a
district to enter into a written contract for the education of its high
school pupils where the term is for a period of less than two years.
2. Such contract may be made with one or more school districts. The
designation of the school districts with which such contracts may be
made shall be made pursuant to the commissioner's regulations.
§ 2040-a. Contributions to school districts containing migrant labor
camps. Notwithstanding any other provision of law, and for the purpose
of sharing the extra expense incurred by a school district in providing
temporary educational facilities for children living in a migrant labor
camp located therein which supplies labor to employers residing in other
school districts, the board of education, trustee, or trustees of any
adjoining school district, or other school district in the same town,
where employers residing therein are supplied with labor from such
migrant labor camp, may contribute not more than three hundred dollars
annually to the school district in which such migrant labor camp is
located. The moneys so contributed shall be used only for the purposes
§ 2041. Trustees or boards of education may contract to receive such
children. The trustees or board of education of any district or city
may enter into a contract to receive and educate in the schools of such
district or city the children of any district which shall authorize its
trustees or board of education to contract for the education of its
children as provided by section two thousand thirty of this chapter.
§ 2042. Form and validity of contract. Every contract for the
education of school children shall be in writing and in the form
prescribed by the commissioner of education, and before such contract is
executed the same shall be submitted for approval to the superintendent
of schools having jurisdiction over said district and such contract
shall not become effective until approved by such superintendent. Such
contract shall not be valid or binding upon either party thereto until a
copy thereof is filed with the commissioner of education and approved by
§ 2044. Report of pupils from other districts. The children attending
a school under any contract for the education of elementary pupils shall
be reported to the commissioner of education by the trustees or board of
education of the district or city wherein such children attend school as
though they were residents of such city or school district.
§ 2045. Non-resident attendance. 1. No charge for the instruction of
nonresident pupils in excess of the difference between the cost of
educating such pupils and the apportionment of public moneys on account
of the attendance of such pupils shall be made by any district. The
tuition charged, if any, in excess of such apportionment is hereby
declared a charge upon the district from which such nonresident pupil
attends, subject, however, to the right of such district to designate
the academic school or schools where instruction shall be given at the
district's expense, and provided that no tuition shall be payable by the
district of residence for the education, by another district, of an
elementary pupil, unless a contract has been entered into between such
districts pursuant to part two of this article. Such designations shall
be made by each school district pursuant to commissioner's regulations.
Such designation may be reviewed upon appeal to the commissioner of
education in the event the parents or guardians of such pupils deem
themselves aggrieved thereby. In case any school district shall fail to
make a timely designation, the district superintendent of schools in the
supervisory district in which such district is located may make such
designation, subject to review on appeal by the commissioner of
education. Districts shall not refuse to receive nonresident academic
pupils for instruction without valid and sufficient reasons therefor.
All acts of the board of education or other district officers relating
to such pupils and the tuition charged for their instruction are hereby
declared subject to review by the commissioner of education. Where a
district is so situated that its academic pupils can be more
conveniently instructed in the academic department of a school located
in another state, the commissioner of education is hereby authorized to
make the same apportionment, annually, to the school district educating
such academic pupils so instructed outside the state, as he shall be
authorized by law to make for the instruction of academic pupils within
the state, and upon the same conditions.
2. If a pupil resides in a district wherein high school courses are
offered, but no vocational high school is available therein, or if
vocational high school courses are not available in the academic school
or schools designated as herein provided, such pupil may select and
attend any other academic school within the state in which vocational
courses are available, and the tuition charged, if any, in excess of the
difference between the cost of educating such pupil and the
apportionment of public moneys on account of the attendance of such
pupil, is hereby declared a charge upon the district in which such pupil
resides, except however, the cost of transportation of such pupil need
not be paid by such district.
3. Any academic pupils attending school in a school district in this
state, but residing on military reservations within the boundaries of
the state of New York, jurisdiction over which has been ceded to the
United States, shall be deemed to be pupils of the school district of
attendance within the meaning of section thirty-six hundred two of this
4. Each district which does not maintain a high school shall provide
transportation when necessary for its pupils who have completed the work
of the sixth grade and are receiving instruction in another district.
8 CRR-NY 174.2NY-CRR
PART 174. COMPUTATION OF TUITION CHARGES
174.2 Computation of tuition charges for nonresident pupils.
The provisions of this section shall apply to all contracts for the reimbursement of a school district which provides instruction to a nonresident pupil. The charge for the instruction of each nonresident pupil shall not exceed the actual net cost of educating such pupil. If the accounting records of the school district providing such instruction are not maintained in a manner which would indicate the net cost of educating such pupil, a board of education, board of trustees or sole trustee of each school district shall compute the tuition to be charged for the instruction of each nonresident pupil admitted to the schools of such district, or for the education of whom such district contracts with a board of cooperative educational services, in accordance with the following formulae:
(2) The cost of instruction for such pupil shall be determined on the basis of such total general fund appropriation, as reduced in accordance with the provisions of paragraph (1) of this subdivision, which is attributable to each of the following four categories: half-day kindergarten, full-day kindergarten through grade six, grades 7 through 12, and special educational programs for pupils with handicapping conditions. If the records of the school district do not accurately reflect the actual appropriation in each of such categories, such total general fund appropriation shall be distributed in the same proportion as the cost of teachers' salaries in each category bears to the total amount of teachers' salaries on a district-wide basis.
(3) The net amount of State aid received by the school district, as defined in this paragraph, shall be distributed among the categories set forth in paragraph (2) of this subdivision in the same proportion that the average daily membership in each of such categories bears to the average daily membership for the school district. For the purposes of this section, such average daily membership shall be computed in accordance with the provisions of paragraph l of subdivision 1 of section 3602 of the Education Law, except that for the purpose of this computation the enrollment of pupils attending under the provisions of paragraph c of subdivision 2 of section 4401 of the Education Law and the equivalent attendance of the school district, as computed pursuant to paragraph d of subdivision 1 of section 3602 of the Education Law, shall not be included in such computation. For the purposes of this section, net State aid shall include aid received in the general fund for operating expenses, textbooks, experimental programs, educational television, county vocational boards and boards of cooperative educational services, building aid, and other forms of State aid as approved by the department for inclusion herein, but shall not include transportation aid. Net State aid shall also include the sum which is withheld from the school district for payment to the teacher's retirement fund.
8 CRR-NY 174.2
Current through December 15, 2014
In the absence of a written contractual agreement, tuition must be established pursuant to the Education Law and the Commissioner's regulations, both of which require tuition to reflect actual cost of education. 43 Educ.Dept.Rep. Op. 15,017 (2004).
Use of a particular formula is not required to establish a nonresident tuition rate, but a school district may not charge more than the state formula rate absent accounting records showing the net cost of educating a nonresident student and that the amount charged is not in excess of the actual net cost. 43 Educ.Dept.Rep. Op. 15,017 (2004).
Fact that petitioner school district did not realize that nonresident tuition rate it had been paying may have exceeded maximum permissible rate until advised by counsel did not excuse delay in bringing appeal. 43 Educ.Dept.Rep. Op. 15,017 (2004).
The use of a particular formula is not required in setting nonresident tuition rates; a receiving district may utilize its own formula provided that its accounting records indicate the net cost of educating each nonresident student and the amount charged is not in excess of the actual net cost of educating each such student. 41 Educ.Dept.Rep. 14,610 (2001).
Nonresident tuition rate charged by school district had to be computed in accordance with formula prescribed in the regulation and published on the State Education Department website unless the school district could demonstrate that it had maintained its cost of education records on a per pupil basis, and in no event should the rate charged exceed the actual net cost of educating such pupils. 41 Educ.Dept.Rep. 14,610 (2001).
Decision No. 15,026
Appeal of the Board of Education of the East Quogue Union Free School District, from action of the Board of Education of the Westhampton Beach Union Free School District regarding nonresident tuition.
Ingerman, Smith, L.L.P., attorneys for petitioner, Lawrence W. Reich, Esq., of counsel
MILLS, Commissioner.--Petitioner appeals the computation of nonresident tuition for the 2001-2002 school year by the Board of Education of the Westhampton Beach Union Free School District ("respondent"). The appeal must be dismissed.
Petitioner has its own elementary school, but for more than twenty years, petitioner has contracted with respondent for the education of petitioner"s secondary students (grades 7 through 12). On July 24, 2002, petitioner received the final bill from respondent for such services for the 2001-2002 school year. Petitioner"s superintendent contacted respondent"s superintendent, stating that funds expended for elementary school capital construction projects should not be included in the net allowable appropriation upon which secondary school tuition was calculated for the 2001-2002 school year. The superintendent asserted that, since petitioner"s secondary school students did not attend any classes at Westhampton Beach Elementary School, capital improvements or repairs to the elementary school did not provide any direct benefit to petitioner"s secondary students and therefore should not be included in the tuition calculation.
Respondent"s superintendent confirmed that elementary school capital construction costs had indeed been included in the tuition calculation, but stated that such inclusion was in accord with the Education Law and Commissioner"s regulations governing nonresident tuition rate calculations. This appeal ensued.
I must first address several procedural objections raised by respondent. Respondent first alleges that the petition should be dismissed because petitioner failed to comply with the requirement in Education Law "2040(1)(c) to obtain voter approval to enter into a contract for the education of all high school pupils of grades 7 through 12 in another district for a period of more than two but less than five years. Petitioner and respondent executed an instruction contract for the period July 1, 2001 through June 30, 2003. Petitioner concedes that there was no voter approval for the 2001-2002 school year, but contends that its board has the inherent responsibility and authority to provide for the education of its students.
Respondent correctly asserts that execution of a tuition contract under Education Law "2040[1][c] requires voter approval. Petitioner was therefore without authority to execute a tuition contract for the 2001-2002 school year due to its admitted failure to obtain voter approval. Therefore, in the absence of a valid contract for the 2001-2002 school year, the rate of tuition must be established pursuant to the provisions of Part 174 of the Commissioner"s regulations (Appeal of the Bd. of Educ. of the East Moriches UFSD, 41 Ed Dept Rep 45, Decision No. 14,610; Appeal of the Bd. of Educ. of the Southampton UFSD, 20 id. 101, Decision No. 10,331).
Respondent further argues that the petition should be dismissed because petitioner failed to name the State Education Department ("Department") as a necessary party. Respondent contends that, because it relied on policies and nonresident tuition rate worksheets provided by the Department, as well as statute and regulations, the Department is therefore a necessary party to a challenge to those calculations. However, it is well settled that Education Law "310 does not authorize an appeal to the Commissioner from actions taken by Department staff (Appeal of the City of Albany, et al., 43 Ed Dept Rep ___, Decision No. 14,961; Appeal of Sheppard, 41 id. 150, Decision No. 14,643).
Respondent also contends that petitioner should be estoppel from challenging respondent"s methodology to calculate nonresident tuition since petitioner has sent its secondary students to respondent district for more than twenty years; respondent has consistently used the same methodology to calculate the tuition rate; and petitioner did not prospectively object to the calculation methodology at the beginning of the 2001-2002 school year but instead waited until the end of the school year. However, equitable estoppel does not apply against a government subdivision except in limited circumstances not applicable here (Parkview Assoc. v. City of New York, et al., 71 NY2d 274; Appeal of Perez, 42 Ed Dept Rep 71, Decision No. 14,779; Appeal of Prospero, 37 id. 62, Decision No. 13,804). Additionally, I note that tuition payments are due at the end of the applicable school year (Appeal of the Bd. of Educ. of the Port Jefferson UFSD, 26 Ed Dept Rep 525, Decision No. 11,841). Although petitioner had agreed to make periodic payments of the estimated tuition throughout the school year, petitioner timely initiated this appeal within thirty days of receipt of the final invoice for the 2001-2002 school year and is entitled to question the final computation of tuition for that school year.
The regulation at issue is "174.2(a), which establishes a formula for computation of tuition charges for nonresident pupils. The regulation provides in pertinent part:
(a)(1) The total general fund appropriation shall be ascertained from the district budget for the school year. The amount of such appropriation shall be reduced by the amount of the appropriation for transportation, including debt services for buses, adult education, special schools, community services and any other appropriations which do not benefit such student (emphasis added) 8 NYCRR "174.2[a]).
Using the final total general fund appropriation figure, a per pupil cost of instruction is calculated, which is then distributed proportionately among four categories: half-day kindergarten, full-day kindergarten through grade 6, grades 7-12 and special education programs for children with disabilities. The maximum nonresident pupil tuition that may be charged is determined by dividing the net cost of instruction of pupils in each category by the estimated average daily attendance of pupils in each category (8 NYCRR " 174.2[a][5]).
Petitioner contends that the highlighted phrase of "174.2(a)(1) requires respondent to subtract any capital construction costs for elementary schools from the total general fund appropriation for purposes of billing petitioner for the education of its secondary students, because those costs do not "benefit such students." A response to this contention requires a review of the history of the tuition reimbursement formula and the data that are included in the calculation of the net cost of instruction per pupil.
The formula for calculating nonresident tuition charges was first established in 1949 in Matter of Common School District No. 8, Town of Fayette, 70 State Dept Rep 69, Decision No. 5375. This so-called "Seneca Falls formula" first determined the total cost of instruction for all pupils in grades K-12, and then allocated this total cost proportionately among student categories including grades 1-6 and grades 7-12. Acting Commissioner Wilson noted that "[s]ince none of the items of expenditures except teachers" salaries can be clearly differentiated" to distinguish between the different grade categories, the Seneca Falls formula allocated the total cost of education to each category in the proportion that teacher salaries in each grade category bore to the total expenditure for teacher salaries (id.). There was no requirement in the formula to segregate or allocate capital construction costs to specific grade categories. The only allocation among grade categories was made in accordance to the proportionality of teacher salaries between categories.
In 1962, Commissioner Allen in Matter of Common School District No. 2, Town of Geneva, et al., 2 Ed Dept Rep 319, Decision No. 7109, noted that although there had been certain changes, the Seneca Falls formula still represented the proper formula for computing nonresident tuition. Consistent with the 1949 decision, the first step of the formula was described as "ascertain[ing] total estimated expenditures from budget for current year " for all school purposes except transportation, cafeteria, adult education, summer and other recreation and summer school" (id.). Again, there was no requirement to allocate specific capital construction costs among the various grade categories. In 1974, the Seneca Falls formula was codified as Part 174 of the Commissioner"s regulations (Matter of the Bd. of Educ. of the Mount Pleasant-Blythedale UFSD, 16 Ed Dept Rep 288, Decision No. 9398). The phrase at issue in this appeal, "which do not benefit such student," appeared in the original wording of "174.2 and has not changed.
The Department"s State Aid unit has historically interpreted the phrase "benefit such student" in "174.2(a)(1) to refer generally to all nonresident students attending school in the district, not individualized within each of the grade categories, and the information solicited by the Department from school districts and used in the computerized formula reflect that historic interpretation. The Department uses a computerized worksheet to implement the "174.2 formula and calculate nonresident tuition charges for each school district. The necessary data for the worksheet is derived from a report of proposed appropriations for the ensuing school year that is submitted annually by each school district on the "School District Annual Financial Report" or "ST-3." As one item of the ST-3 report, districts must list all appropriations for bond debt service for capital construction projects for the ensuing year, but need not specifically list and quantify the amount allocated for every individual project and what student category or categories the project may "benefit." The total cost for school capital construction is included in determining the total general fund appropriation figure that is then used to determine the cost of instruction per pupil.
The "174.2 formula reduces the district"s total general fund appropriations by the amount of any expenditures that are not generally of benefit to the nonresident students in the district (such as adult education or community services). Recognition of the relative influence on the cost of education by the number of students in each of the student categories is provided by the second step of the calculation, when the general total cost per pupil is allocated among the four categories ("174.2[a][2]).
As noted supra, the ST-3 form does not require districts to break down the total appropriations for each bond into specific subtotals for costs attributable to elementary school construction vis-"-vis secondary or other category. There are legitimate reasons for not requiring this level of specificity to comply with the requirements of "174.2. A school district may pay debt service simultaneously on many bonds for school construction in any given year; each bond can potentially cover a number of different construction projects; and the various projects may not be clearly distinguishable between the student categories. In districts that have a number of bonds and multiple projects, the sheer administrative burden of attempting to identify individual pieces of the bonds and the proposed year"s construction expenditures that are attributable to each of the student categories would be unduly burdensome.
Moreover, a district"s facility needs and grade configurations may change over time, making it difficult to predict how a particular facility will be used in the future. In that sense, it is impossible to determine whether a debt service payment on a 30-year bond made in the current year will ultimately directly benefit only elementary or only secondary students from the sending district. Treating all construction costs as fixed costs attributable across grade levels is reasonable, given the burden that a microscopic allocation by grade level will require. In sum, the original Seneca Falls formulation did not require this level of detail " it recognized that "none of the items of expenditure except teachers" salaries can be clearly differentiated" to apportion costs among the student categories, and permitted these other costs to be lumped together in computing a total cost of instruction for all pupils (Matter of Common School District No. 8, Town of Fayette, supra).
A district that has accurate records reflecting actual costs to educate the students in each category separately may use such actual costs to calculate nonresident tuition per category rather than using the formula (Education Law "2045; 8 NYCRR "174.2; Appeal of the Bd. of Educ. of the East Moriches UFSD, supra; Matter of Volker, et al., 4 Ed Dept Rep 161, Decision No. 7501). There is no indication in the record, however, that respondent keeps its records in that fashion. I find no requirement in the regulation to implement a hybrid system whereby capital construction costs must be parsed out as actual costs per particular student, regardless of how the district keeps its records.
Of course, in a particular case, the districts that are parties to a tuition contract may specifically agree that particular costs or categories of costs, and the State building aid attributable to such costs, will be not be included in the calculation and the receiving district may recalculate the computerized rate provided by the Department so long as the total nonresident tuition rate charged does not exceed the maximum level imposed by the formula and "174.2 (Appeal of the Bd. of Educ. of the East Moriches UFSD, supra).
I conclude that respondent reasonably and correctly used the tuition rate calculated by the Department pursuant to the formula in "174.2, and properly included all school capital construction costs in its computation of nonresident tuition for petitioner"s secondary students.