What's happening
This bill allows schools for the deaf and blind to keep limited financial reserves each year.
Why it matters
This bill impacts specialized schools for the deaf and blind across New York State, allowing them to keep a modest financial reserve (up to 4% of annual costs), which is a significant change from previous rules that generally required returning unspent public funds.
Permitting these institutions to maintain a small surplus year-to-year could increase their financial stability, helping them manage unexpected expenses or plan for program improvements, which may benefit students who require highly specialized services.
The bill introduces new transparency requirements by mandating annual reporting on how much money is being retained and spent, potentially increasing public oversight of how state funds are used to support services for students with sensory disabilities.
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Who cares
Institutions Serving Deaf and Blind Students
These schools will directly benefit from being able to retain a portion of surplus funds, giving them more financial flexibility and stability for planning and addressing unexpected costs.
- Likely support
Students and Families of the Deaf and Blind Community
Enhanced financial stability at these institutions could support program improvements, continuity of services, and potentially better educational outcomes.
- Watching
State Education Department and Oversight Bodies
Responsible for monitoring compliance, reviewing annual reports, and ensuring that retained funds are used appropriately according to state law.
Governing Boards of Qualified Institutions
Will have increased authority and responsibility in authorizing the retention and expenditure of surplus funds, impacting how schools prioritize spending and manage reserves.
Headline styles
Allow Deaf/Blind School Reserves
Plain English, a few words. Used as the page title.
Sponsors
Senator · Senate District 37
1 Co-sponsor
History
- Referred to education
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
10378
IN SENATE
May 15, 2026
Introduced by Sen. MAYER -- read twice and ordered printed, and when printed to be committed to the Committee on Education
AN ACT to amend the education law, in relation to authorizing fiscal reserve funds for institutions providing instruction to the deaf and blind
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 4204-b of the education law is amended by adding a new subdivision 5 to read as follows:
5. For the two thousand twenty-six--two thousand twenty-seven school year and thereafter, an institution subject to this article shall be authorized to retain funds in excess of their allowable and reimbursable costs incurred for services and programs to students appointed. The amount of funds that may be annually retained shall not exceed one percent of the institution's total allowable and reimbursable costs for services and programs provided to students for the school year from which the funds are to be retained, provided that the total accumulated balance that may be retained shall not exceed four percent of such total costs for such school year and provided, further, that such funds shall not be recoverable on reconciliation, such funds shall be carried forward as total reimbursable costs for purposes of calculating subsequent year prospective and reconciliation tuition rates and such funds shall be separate from and in addition to any other authorization to retain surplus funds on reconciliation. Funds shall be expended only pursuant to an authorization of the governing board of the institution for a purpose expressly authorized as part of allowable costs for the year in which the funds are to be expended, provided that funds may be expended to pay prior year outstanding debts. Any institution that retains funds pursuant to this subdivision shall be required to annually report a statement of the total balance of such retained funds, the amount, if any, retained in the prior school year, the amount, if any, dispersed in the prior school year, and the financial reports that are required to be annually submitted to the department.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD15829-01-6
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the education law, in relation to authorizing fiscal reserve funds for institutions providing instruction to the deaf and blind
Purpose of bill
To authorize state-supported special education institutions subject to article 95 of the education law to retain a limited portion of surplus reimbursement funds.
Summary of specific provisions
Section one amends section 4204-b of the education law by adding a new subdivision 5 authorizing institutions subject to article 85 to retain, beginning in the 2026-2027 school year, up to one percent annually of funds received in excess of allowable and reimbursable costs incurred for services and programs provided to students. Total accumulated retained balance may not exceed four percent of the institution's total allowable and reimbursable costs for a school year.
Section two establishes the effective date.
Justification
Institutions operating under article 85 of the education law serve students who are blind, visually impaired, deaf, hard of hearing, and students with disabilities requiring intensive education and related support services. They provide specialized educational programming pursuant to the tuition reimbursement methodologies established by the State Education Department.
Under the current framework, amounts received in excess of allowable and reimbursable costs are subject to recovery through the reconciliation process. These schools have limited ability to accumulate operating reserves or address non-recurring fiscal pressure. As a result, 4201 schools frequently lack sufficient financial flexibility to manage cash- flow variability, unanticipated expenditures, emergency facility repairs, and other allowable program expenses that may arise outside of the prospective tuition rate-setting cycle.
This legislation establishes a narrowly circumscribed authorization permitting these schools to retain a limited portion of surplus reimbursement funds. The bill limits annual retention to no more than one percent of total allowable and reimbursable costs and caps aggregate retained balances at four percent of such costs. It also requires that retained funds remain restricted to allowable program purposes, be sepa- rately accounted for, and be subject to annual reporting to the State Education Department.
Prior legislative history
New bill.
Fiscal implications
N/A
Effective date
Effective immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.