There are 673 school districts of all sizes in New York State. These range from New York City, the nation’s largest school district, which enrolls nearly 940,000 students in grades K-12, to 280 districts that each enroll fewer than 1,000 students. Stated another way, approximately 42 percent of the state’s school districts serve just 6 percent of its K-12 student population.

As part of the 2024–25 New York State budget, New York Governor Kathy Hochul and the State Legislature agreed to revise the formula for and substantially increase state-funded incentive aid to school districts that choose to merge. First offered to districts choosing to merge after July 1, 2007, reorganization incentive aid was tied to the level of state aid districts received in the 2006–07 school year. Until the recent reforms, this base aid level was kept in place, meaning that the incentive aid calculation was not adjusted for inflation or school districts’ current spending levels. The updated formula now ties reorganization incentive aid, which is paid to districts over 14 years, to the total amount of Foundation Aid districts receive in the year in which their merger occurs, ensuring that these grants will better reflect districts’ current budgets. An example offered by the New York State Education Department (NYSED) shows that a merger of the Johnsburg (total K-12 enrollment: 241) and Minerva (total K-12 enrollment: 97) school districts, one that was voted down in the fall 2024, would generate a nearly $11 million increase in aid—from $3.8 million under the prior formula to $14.6 million under the new one, almost tripling the amount of grant funding available.

42 percent of the state’s school districts serve just 6 percent of its K-12 student population.

Merging school districts in New York State typically occurs in one of two ways: centralization, which dissolves the merging districts and forms a new single consolidated district; and annexation, which folds one or more school districts into an existing district.

A number of benefits from merging can be realized from the increased economies of scale, including: expanded academic programming to provide a more robust and scholarly educational experience, including Advanced Placement coursework and dual-enrollment programs such as Smart Scholars Early College; access to additional resources, including more instructional staff, additional curricular materials, and classroom equipment; a greater ability to offer a variety of extracurricular programs because of larger student enrollment and greater availability of staff supervisors; more effective support of school principals and other educational leaders; and, cost-savings from consolidated administrative and operational functions.

On the flip side, many school districts are reluctant to merge because of a number of concerns, including: the burden and inconvenience of increased busing times for students, especially for elementary-aged children; the possibility of less individualized attention for students due to increased class sizes; increased costs if teacher and staff salaries need to be “leveled-up” to the higher-paying district’s pay scale; and, a general fear of a loss of community identity. Winning public approval for school district mergers can therefore be tough—a March 2025 straw-poll vote on a proposal to merge the Mongomery County school districts of Fort Plain (total K-12 enrollment of 638) and Canajoharie (total enrollment of 796) lost in both districts, even with the promise of $56 million in new state reorganization incentive funding.

…school districts in New York can pursue a middle ground between merging and staying completely separate that still expands and enhances educational offerings for students and cuts costs for local residents: regionalization efforts and shared-services agreements.

Merging and annexing school districts is a dramatic course of action and, as the recent vote in Canajoharie and Fort Plain evidences, a step that local residents are not always prepared to support. Fortunately, school districts in New York can pursue a middle ground between merging and staying completely separate that still expands and enhances educational offerings for students and cuts costs for local residents: regionalization efforts and shared-services agreements.

Why Regionalize?

As noted above, 280 school districts in New York State each serve fewer than 1,000 students total in grades K-12. More than half of all school districts in New York State—347, or about 52 percent—have fewer than 25 students per square mile, too, qualifying them for supplemental school aid under the “Sparsity Count” component of the state’s Foundation Aid formula.

Each of these districts likely could benefit from combining resources in a partnership that takes a more regionalized approach to education and operational services. As the Rockefeller Institute noted in its December 2004 review of the state’s Foundation Aid formula, too-low enrollment can “limit a district’s ability to provide specialized classes such as Advanced Placement courses and a broad spectrum of programming in the arts, business, and other ‘non-core’ academic areas, for example, and large areas with disperse student counts impede arrangements for effective sharing of critical supports such as school psychologists and more.” Districts that face financial and operational challenges because of their small size may find solutions to these challenges by partnering with neighboring school districts to tap the benefits of economies of scale.

“Regionalization” is a collaborative approach where neighboring school districts, individual schools, and often a centralized coordinating body work together to identify ways to better meet student needs and to achieve operational efficiencies through shared resources and cross-district coordination. Regional planning conversations help design actions that, as NYSED notes, “build upon the strengths inherent in local communities” and explore innovative solutions for improving educational opportunities for all students.

Sharing Services and Supports

Currently, school districts are permitted to combine services administratively and can do so either by directly coordinating with each other to share certain services or through a centralized agent that provides coordinated or consolidated services to many different districts. The most common centralized agents for shared services in New York are the Boards of Cooperative Educational Services (BOCES). As the New York State School Boards Association notes: “When two or more school districts determine they have similar needs that can be met by a shared program…BOCES [can] help school districts save money by providing opportunities to pool resources and save costs.” There are 37 regional BOCES across New York State.

Among the functions that are well-suited for regionalization are the following:

Regional High Schools

Regionalization efforts can include not just particular services or activities, but the creation of new regional high schools that span multiple local school districts, too, a position championed by the Rural Schools Association of New York State.¹ David Little, the executive director of the Association, noted: “When students need broader curricula that are oftentimes financially extremely difficult to provide in our existing structure, districts may choose to come together, two or three or four districts, to provide one high school for that area… Vermont, Massachusetts, and Connecticut all have regional high schools. The idea here is that if you take, say, three local high schools, bring them together, you don’t need three history teachers or three algebra teachers, but you do need advanced coursework in both math and history. So you might have a business law course or an advanced math course or maybe offer a dual-enrollment course with the local community college or SUNY campus. So, all of those teachers would still be employed, but you’d be able to provide a broader array of curricula than you might be able to if you had, say, only 25 or 30 kids in your senior class.”

Challenges and Policy Solutions to Support Regionalization

A significant challenge to large-scale regionalization efforts, including the establishment of consolidated multi-district regional high schools, is often the initial costs that school districts may face. To incentivize regionalization and shared services, state policymakers could consider funding these efforts. Several options exist. First, state policymakers could create a funding stream that offers incentive aid similar to how it is offered for districts to merge or consolidate. Second, the state could incentivize shared-service contracting as it currently does for its County-Wide Shared Services Initiative program. And third, funding programs could be structured to achieve certain regionalized outcomes, such as regional high schools. In the Rockefeller Institute’s report on Foundation Aid, we noted: “As an incentive to pursue [regionalization effort], policymakers could consider including in the [formula’s] Sparsity Count only students enrolled in grades K-8, prompting the formation of more regional high schools that could offer more complete educational programming for students in grades 9 through 12. [S]uch an approach…would need to be accompanied at the same time by a robust investment of state funds to incentivize the formation of regional high schools to ensure that educational opportunities for these students are enhanced, not diminished.”

Whatever the state’s support method, a goal for funding regionalization efforts could be for the state to ensure, first, that districts are not required to bear any new costs, and second, that districts participating in regionalization are entitled to retain all or a portion of annual cost savings that are realized from such efforts. For school districts envisioning regionalization efforts of any type, additional state incentive funding could underwrite the costs of a comprehensive feasibility study to quantify predicted cost-savings from efficiencies, estimated costs associated with the new ability to offer expanded and enhanced academic programming, and expected improvements in student outcomes as a result of the reforms (an example of such a feasibility study is one sponsored by the Hartford Foundation for Connecticut school districts and New Jersey’s School Regionalization Efficiency Program offers a model for a state grant program to offset the costs of such studies).

Regionalization and shared-service contracting, in addition to merging, can be a pathway to increasing educational exceptionalism in some of the state’s smallest and most sparsely populated school districts. As poignantly stated by Tim Gonzalez, superintendent of the Worcester Central School District (total K-12 enrollment: 310): “A student…is no less deserving of a robust educational experience simply because of their geographic location.”

ABOUT THE AUTHOR

Brian Backstrom is director of education policy studies at the Rockefeller Institute of Government.

[1] See as well, for example, David A. Little, executive director, Rural Schools Association of New York State, “Testimony Before the Nelson A. Rockefeller Institute of Government, Hearing on Foundation Aid,” August 8, 2024.