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UFT urges dramatic step to amplify the gains of universal pre-K

City should cut class size by closing tax loopholes

Program would be funded by slashing benefits going to nearly 90,000 absentee-owner luxury apartments
Press Releases

UFT President Michael Mulgrew today urged New York City to embark next September on a long-term initiative that will lower class size in the public schools to no more than 15 students in kindergarten through third grade.

This dramatic step would help cement the expected gains to children’s learning from the universal pre-K program that started this fall. It would also reflect the independent research that has identified 15 students as the optimum size in early grade education.

To pay for this citywide class size reduction, Mr. Mulgrew recommended the city create a new "fair-share" choice for foreign and out-state absentee owners who often now pay absurdly low real estate taxes: either pay taxes on the actual market value of their units; or become a New Yorker and be liable for the income taxes that other New Yorkers pay. He estimated that the total new revenue from such a change could be $900 million per year or more.

Mr. Mulgrew said: "Tens of thousands of absentee apartment owners — generally out-of-state and foreign millionaires and billionaires — have bought New York City apartments as investments rather than homes. Yet they get to take advantage of excessive real estate tax breaks that reduce their rates to a fraction of what middle-class New Yorkers pay. It’s time we put a stop to this free ride, and to use the money a ‘fair-tax’ proposal would raise to benefit all New Yorkers by dramatically lowering public school class size in the early grades."

Initial class-size reduction could begin next year

While it will take a number of years and substantial capital investment to implement the class size/tax policy change citywide, a UFT analysis shows that the administration could introduce it this fall in 100 schools — generally in the city’s poorest communities — that now have a few spare classrooms.

The limited first-year cost — approximately $30 million for teacher salaries — would be easily accommodated in the overall Department of Education budget.

Expanding the program to all schools, including new facilities, would cost an estimated $900 million a year when fully implemented — even then accounting for only a little over one percent of the city’s $77 billion expense budget.

The Tennessee Project STAR (Student Teacher Achievement Ratio) — a dramatic class size reduction program — is the example most cited by experts for its success, including by the National Education Policy Center (NEPC).

The NEPC described STAR, where class sizes averaged 15 students, as "the best evidence on the impact of reducing class sizes," and said among its "unequivocal" positive results were higher scores on standardized tests. In addition, the NEPC said, "When the results were disaggregated by race, black students showed greater gains from being assigned to a small class…" and that "small-class benefits in STAR were also larger for students from low socio-economic status families."

Noting that rich New Yorkers send their children to schools where the class size is often 15 or even lower, Mr. Mulgrew added: "It’s time for us to start providing a similar benefit for the families who rely on the public schools."

Class sizes in New York City now average the highest in the region, and are limited only by the UFT contract. They rose in New York City for the previous six years, though they came down slightly — to an average of more than 24 students in grades K–3 — last year.

But, as the organization Class Size Matters noted, more than 30,000 kindergartners were in classes larger than 25, thousands of students in classes of more than 30, and at this rate it would take decades to reduce class sizes significantly.

New York City as a tax haven for the rich

According to the New York City Department of Finance, approximately 90,000 condos or co-ops in New York City — primarily in Manhattan — are vacant most or all of the year. The most recent U.S. Census Bureau survey showed that more than half the apartments in one of Manhattan’s highest-price neighborhoods — 57th to 63rd Streets, Fifth to Park Avenues — were essentially unoccupied.

As a rule such absentee owners do not pay New York City income tax, yet a combination of outdated incentive programs such as 421A and a dysfunctional assessment system leave these multi-million-dollar units paying ludicrously low annual real estate taxes.

Using the standard applied to apartments at 15 CPW, the owner of the average single-family home in Bellerose, Queens, would be paying less than $300 a year, rather than the nearly $4,000 he now pays. If the owner of an East Flatbush co-op worth $350,000 got an equivalent tax break, she would pay $186 per year in real estate taxes rather than the $3,002 in her current annual tax bill.

Mulgrew added: "The state legislature has already limited one tax advantage to primary residents, and other jurisdictions around the country do the same. Before their advocates start a ‘pity the poor billionaires’ campaign, let’s remember that more than one million middle- and working class families must annually prove their residence in New York City to receive the much more modest benefits of rent stabilization and rent control. Why should our-of-town millionaires not be held to the same standard?"

Read the full policy memo from the UFT »