Mayor Michael R. Bloomberg today announced the administration’s plan for how it would allocate Campaign for Fiscal Equity (CFE) funds this afternoon at PENCIL’s Principal for a Day Town Hall Meeting. The prepared text follows below:

At the outset, I want to thank our hosts, the home of the Lincoln Center Institute for the Arts in Education.

Like many cultural organizations throughout our City -- and like all of you -- the Institute is a strong partner of education in our schools.

Our Administration's goal is to enhance the quality of arts instruction at every grade level.

We’re going to roll out a new citywide plan to strengthen education in visual arts and music in the next school year, the first phase in a continued focus on arts education in the coming years.

Let me start by congratulating all of our principals for the day!

All of you have really brought something special to our schools -- during this 10th annual “Principal for a Day” program organized by Lisa Belzberg and the staff of PENCIL.

For example, Napoleon Barragan of Dial-a-Mattress taught kids to spell mattress “m-a-t-t-r-e-s”…and leave off the last “s” for savings.

But I don't recommend using that kind of spelling in the Regents exam.

Harlem’s world-famous restaurateur Sylvia Woods made a few welcome changes to the school lunch menu that involved getting away from those "healthy diets."

And David Neelemen of Jet Blue put a TV set on the back of every student’s seat -- educational programming only, I’m sure.

Now more than ever, our city’s students need your leadership on their behalf -- not just today, but every day, not just in our City’s classrooms, but also in the state capital in Albany.

You’ve been out there, you’ve seen what our schools need, and now we need you to advocate for those needs.

That's what I really want to talk about today.

Earlier this week, the Zarb Commission released its recommendations on how State Government must meet its obligations to the school children of New York City. Frank Zarb, the members of the Commission, and Standard & Poor’s must be commended for their efforts in producing this detailed report.

Governor Pataki, who appointed the commission, also deserves credit for tackling the tremendous challenge of redressing the State’s historic and shameful under-funding of the city’s public schools.

Let’s quickly review how we got to this point.

The Zarb Commission report with the Standard & Poor’s analysis comes at the Governor’s request in response to the State Court of Appeals ruling last June in the “Campaign for Fiscal Equity,” or “CFE” lawsuit, as it's called.

In that case, the Court found that long years of State underfunding had systematically denied our City’s students the sound basic education that is theirs by right.

The Court gave the State until the end of July, 2004 to devise and begin to implement a plan for correcting this wrong.

If it doesn’t, the Court said that it will.

Yesterday, the plaintiffs in the original CFE lawsuit also presented their views about what the State must do to comply with the court order.

As you may remember, as a candidate for Mayor, I supported the CFE suit.

After I took office, the City Law Department submitted arguments to the Court in support of the plaintiffs.

We believe that both the Zarb/S&P and CFE reports make positive contributions to determining what the State government must now do.

Twenty-one months ago, our Administration was granted control over a school system that had been decentralized some 35 years earlier, with devastating results for our children.

With our new authority comes the responsibility to set our school system’s funding priorities -- and then be held accountable for the results.

And that is what we are doing today.

If it is the State -- or the courts -- that ultimately provide the City with increased educational funding, the City stands ready with a well-thought-out, practical plan of how to insure the public’s dollars achieve the results that the public wants for our children.

We are presenting our plan for allocating what must reasonably become, within five years, at least $5.3 billion in additional annual State operating funds, dedicated to the needs of New York City’s public schools, to meet the requirements of the CFE court order.

This figure is about the same amount recommended by the plaintiffs in the CFE suit.

Chancellor Klein and his team at the Department of Education developed this plan after extensive research, consultation with the plaintiffs in the CFE suit, and analysis of the recently released Zarb/S&P report.

We believe that -- along with our previously released $13.1 billion five-year capital plan for the schools -- this provides the Winimum, additional, annual funding needed to provide all our students with a sound basic education.

Should the courts order a “phase in” period, sadly our current students will be deprived of many of the benefits quicker action would provide -- but the City does have a set of priorities, and will institute programs as the funds become available.

The Court of Appeals decision has presented the State -- led by the Governor, Assembly Speaker Sheldon Silver, Senate Majority Leader Joe Bruno, and their colleagues in the Legislature -- with an historic opportunity to help our Administration realize the essential goal of our “Children First” school reform program: ensuring that every child who enters our schools graduates with a diploma that is meaningful.

That is what the court has established as the acid test of a sound basic education. It is our duty -- with the State’s help -- to meet that standard. Turning that goal into a reality is why I ran for mayor. It’s why we sought control of the school system.

It has guided our decisions on issues ranging from curriculum reform to school safety to ending social promotion. And it is the basis for our plan to use additional State support for a broad range of operating needs…

From vastly expanding pre-school education, to overhauling our secondary schools, and, in the early grades, to reducing class size, extending the school day for struggling students, and giving youngsters the classroom interventions and support they need in order to learn.

We have four principal priorities.

They represent crucial elements of our Children First agenda. Funding them must be a multi-year effort that begins immediately, with the next fiscal year.

That’s because adequate and immediate funding for these priorities is critical to helping us transform a school system in which half of the students do not graduate from high school in four years into one that prepares all students for the demands of the 21st century, knowledge-based economy.

Before I detail them, I want to make a few things clear to everyone involved.

The CFE ruling is about our City’s students -- and only them.

Providing fair State funding for the City’s schools is the only appropriate subject for consideration in response to the Court order.

Second, complying with the Court order is a State responsibility. As the Zarb/S&P Report’s research demonstrates, an equitable distribution of State education funds would allocate roughly three out of every four new dollars to New York City schools.

Currently, we receive only about three out of every eight -- meaning that we have been severely shortchanged for years.

The first order of business must be correcting that systemic injustice at the State level.

And third, State compliance with the Court must not involve imposing across-the-board mandates, funded or unfunded, on the City.

The evaluation of education spending that Standard & Poor’s did for the Zarb Commission found that targeted investments made at the local level are more likely to be effective than State-ordered, “one-size-fits-all” spending.

And our Administration agrees.

Another level of State bureaucracy -- or restrictive State-dictated requirements subject to political manipulation -- are the last thing the City school system needs -- and would instantly be challenged in court.

Our first priority is creating a culture of excellence in the schools.

Whether you’re from a large corporation, small business, non-profit organization or faith-based institution, you understand the importance of leadership.

Our Children First reforms have begun this with a clear emphasis on strong leadership, high quality teaching, and parent engagement in our schools.

If we want all our children to reach their potential, we must provide them with first-rate principals and teachers, and encourage parental involvement in education.

Therefore, using approximately $830 million in annual CFE funding, we propose to establish new career ladders for teachers, significantly expand professional development for teachers and administrators, create incentive and merit programs for principals and teachers, and provide more training and services for parents.

I should note that the Zarb Commission also supports this approach.

We have already begun an ambitious leadership preparation program that has an ultimate goal of preparing at least 200 new, highly trained principals each year. Nothing is more important. Without great leadership in a school, no amount of dollars or staff is enough!

We also need to increase professional development and leadership training for current principals and other school administrators.

We must offer salary incentives to ensure that the most highly qualified principals take on the challenges of our most demanding schools. The same goes for teachers.

It is almost impossible to overstate the impact that teachers have on their students. Recent studies have shown that students taught by the most effective teachers work at a full grade level above what students taught by the least effective teachers achieve.

The CFE decision provides us a golden opportunity to capitalize on what our best teachers can accomplish. Under our plan, teachers who excel will have opportunities to become lead teachers and mentors in their schools.

All new teachers will have such mentors for two years to help them implement the best practices of teaching and learn from the experience of their mentors. Incentive programs will also help us fill shortages in subject areas, and ensure that our most challenging schools are staffed with their share of our most qualified and capable teachers.

In addition, we will expand the number of literacy and math coaches in the schools where they’re needed most.

And as to parents: We have made a substantial commitment to increase parent engagement and make our schools more open to their participation. We’ve done this by placing a full time parent coordinator in each school.

Our Parent Academy also trains parent coordinators, school leadership teams, and parent and parent/teachers associations throughout the city. We propose to use CFE funding to expand this work, and to create a new translation unit that will help all parents become full partners in their children’s education.

I will not rest until we have every parent, adult, or sadly sometimes, a city agency substituting for parents, engaged in what’s happening with our children in the schools.

Our second priority is early grade intervention and academic enhancements -- to which we propose to commit more than $1.9 billion a year in CFE funds. More than a quarter of that, or some $542 million a year, would go to making pre-kindergarten education truly universal in our city. By Fiscal ’09, we would for the first time offer all three-year-olds half-day pre-kindergarten programs.

We would also provide full-day programs for all four-year-olds throughout the city. So Lisa: you may want to start preparing to recruit pre-kindergarten “principals for a day,” too -- a lot of them!

Department of Education statistics indicate that today, close to 85% of four-year-olds enrolled in "pre-k" attend half-day programs, and miss out on what a full day of pre-school can offer them.

We’ve got to change that, because both educational research and common sense tell us that children don't enter kindergarten as blank slates.

They come in with varying degrees of readiness to learn. Research on early childhood learning and school achievement shows that investment at ages 3, 4, and 5 pays off.

Pre-school helps youngsters enrich their vocabulary -- a strong predictor of how well they do in the upper grades -- and develop the social skills that give them the confidence to succeed.
Children of all income levels who participate in well-designed, well-run pre-schools do significantly better in school.

For similar reasons, we will also use CFE funds to expand kindergarten enrollment for the thousands of five-year-olds who each year do not attend kindergarten.

Now I want to say something about ending social promotion.

We chose 3rd grade as the place to start, because it is a critical point in a child's education. Through 3rd grade, students are "learning to read"; after that they are "reading to learn" to master the far more complex curriculum they’ll encounter beginning in 4th grade.

Some have portrayed our policy as basing promotions on the results of a single test. This is just not true. It includes an appeals process, and summer school. Parents, you have my word: we will do everything in our power to ensure that no student is held back unjustly.

And another essential component of our promotion policy is providing the support that will help children perform at grade-level in the 3rd grade and beyond. Funding such support is how we intend to spend the balance of CFE dollars every year that we allocate to the early grades.

We will, for example, reduce class size from kindergarten through the 3rd grade to 20 students maximum. Most importantly, we will provide the specialized interventions for youngsters in k-3 who are struggling to learn to read fluently and do mathematics competently.

The Chicago school system recently backed away from retaining students on the basis of math performance. We are not going to do that. In this day and age, math is just too important. Without math, you can't get a job.

So we will provide early grade teachers with the professional development that will enable them to assess student needs, so that they can get specialized help. And we will hire and train many more speech teachers, reading specialists, and learning disabilities specialists, and supply them with the materials they need.

CFE funds will also be used to extend the school day and the school year for many more struggling students, so that they have opportunities for intensive support and more time to reach standards.

We will be able to provide each elementary school a science teacher, an art teacher, a physical fitness teacher, and guidance or social work staff.

We will increase instructional technology in the schools and provide each school with an information technology expert.

To inject healthy competition and broader choice into the system, we will use CFE funds to support new charter schools throughout the city.

The next major priority -- one to which we propose to allocate more than $2 billion annually in CFE funding -- is secondary school reform.

The situation is dire for the thousands of adolescents who fail to graduate from high school, or who complete school without the skills they need.

Today, some 70% of 8th grade students are working below grade level.

The traditional structure of middle and high schools -- which many of you have been in today -- contributes significantly to this problem. These schools were never designed to enable all students to gain the knowledge and skills required to succeed in post-secondary education and in today's ever-more-demanding workplaces.

The traditional expectation was that if you graduated from high school with the equivalent of an 8th grade education, that was sufficient. Not any more.

New York State has moved in the right direction of setting higher standards at the secondary school level, although we are concerned about at least some people’s perception that the State sets pass/fail requirements based on anticipated percentages in each category—rather than whatever level of subject/skill mastery is required to succeed in the real world. Manipulating data for political acceptance rather than actually measuring performance does not do our children any favors.

Nevertheless, CFE funding will provide the means to implement a full-scale strategy to meet those standards.

We propose to spend over $812 million each year in CFE funds for both the creation of new small schools and for the restructuring of large middle and high schools into small learning communities of 400 to 500 students each.

Many of the new small schools will be for students in grades k-8 or 6-12. These small schools will increase school choice across the city. All of these smaller settings will offer students high-quality instruction, safe learning environments, the motivation to achieve, and the confidence that their efforts will lead to success.

And by reducing class size to 28 students – max - in the middle grades, teachers will be able to give more individualized attention to each student’s needs.

In these restructured schools, we will offer more effective literacy and math interventions, tailored to the needs of adolescents. We will also expand counseling services and connections to after-school and internship opportunities, giving them the encouragement to succeed and graduate.

With CFE funding we can implement other critically important elements of secondary school reform. We can give more students the chance to do Advanced Placement and college-level coursework; expand our career and technical schools and programs, directly connected to real world job opportunities; invest in improved science and mathematics education; and increase technology-based learning.

We also propose to allocate CFE funding for such youth development and student support services as guidance and counseling, conflict resolution, and substance abuse prevention.

In addition, we plan to significantly expand after-school and extended-year programs for middle school students. These will not only enhance their academic skills, but also give them increased exposure to the arts, sports, career internships, and community service.

Our fourth priority is annually funding some $514 million in additional supports for Special Education students and English Language Learners.

Some of you may have worked with Special Ed and ELL students today, and you may have come away with a better sense of the challenges --and rewards -- involved in their education.

These students will benefit from all the programs I’ve already described.

And additional monies will, for example, permit us to realize our goal of reforming special education by supporting more high-quality inclusion programs, offering more specialized educational programs, and increasing the number of professionals and paraprofessionals working with students who have “Individual Education Plans.”

CFE funding will enable us to hire substantial numbers of new “ELL” instructional specialists and provide them with the materials they need.

In particular, this funding will address the pressing needs of thousands of non-English-speaking immigrant students who enter our secondary schools having had their educations interrupted.

They face enormous challenges learning English while simultaneously mastering the other subjects they need to pass in order to graduate on time.

Before turning the program back over to Lisa, I want to make three final points.

First: all of the State-supported programs I have just described are operating expenses: annual expenditures requiring long-term commitments and matching long-term guaranteed funding sources.

But we also have a $13.1 billion, five-year capital plan for the schools that will create 66,000 additional classroom seats and 90 new schools.

It dovetails precisely with our other reforms.

Without building the classrooms, we can’t do the programs or add the needed staff!

We expect the State to commit its fair share of $6.5 billion to this capital plan.

The City's share is also $6.5 billion -- which is 40% more than we spent in the last capital plan. We are doing our part; they must do their's.

Nothing in the funding the State must provide to comply with the CFE court order offsets this capital obligation on their part.

Second: your leadership in advocating for fair funding for the City’s schools is absolutely crucial.

This is not an “easy lift” for a Governor and Legislature with many responsibilities and limited resources. There are legal, economic and political realities they have to deal with.

We need you to make your voices heard in Albany.

And third: we are prepared to work with State leaders to craft the legislation needed to achieve equity for New York City’s schoolchildren.

This is the most urgent task they face. Because if the State fails to devise a system that truly provides a sound basic education to all our school children, the alternative will be government by court order, interpreted by an unelected “special master.”

It will be a dereliction of duty that will only compound the neglect of our public school children that the court has already censured. I believe that we can, and must, do better than that.

We are offering to help State leaders because the CFE court order is about our kids.

And the State can't do the job right without us.

New York is the city of opportunity. But the State's highest court has ruled that students at New York City schools aren't getting their fair share. This historic contradiction must be corrected.

We need to give our students their due so that they can share in the American Dream.

If we don't, we'll lose out on their talents and all they have to contribute.

AND THERE IS NO TIME LIKE THE PRESENT TO INVEST IN OUR FUTURE.

Thank you once again -- and let me wish PENCIL a very happy 10th anniversary and many more returns of the day.