Last updated on March 18th, 2025
As of July 2024, school districts in New York State that reorganize—or merge—are eligible for financial assistance of up to 40 percent of the Total Foundation Aid Base under the Reorganization Incentive Operating Aid (RIOA) program. Unfrozen in the 2024-2025 state budget, RIOA is available to reorganized school districts for up to 14 years after merging, on a phase-out basis. New York State encourages consolidation for districts with small student populations as a solution to issues caused by low enrollment. Several districts in the state have already made the decision to merge, and more are considering the possibility.
The potential benefits of merging districts include cost savings, additional resources, expanded offerings for students, and upgraded facilities. However, many smaller districts are reluctant to merge due to concerns over loss of school identity, less individualized student attention, increased travel time, the potential for higher property taxes, and other possible consequences. In-depth studies evaluating the prospective benefits versus costs for school districts considering reorganization are necessary to determine the feasibility of potential mergers.
Potential Benefits of Merging
Cost Savings
Merging districts can result in reduced administrative and operational costs. Consolidating districts reduces the number of teachers and administrative staff required to operate the district, and fewer school buildings means less spending on utilities such as heat and electricity. Consolidating bussing systems can also help reduce transportation costs.
Additional Resources
A reorganized district benefits from the combined resources of both districts involved in the merger, including teaching staff, learning materials, and school equipment.
Expanded Programs
The funding provided through the RIOA program allows reorganized districts to develop and strengthen both academic and extracurricular programs. The new, larger districts may be able to hire more specialized instructors and offer a wider variety of educational programs. The funds can also be used to support non-academic programs such as athletics, clubs, and theater and music programs.
Facility Upgrades
RIOA funds can also be utilized to improve or renovate school buildings and grounds.
Concerns over Merging
Loss of School Identity
Communities faced with the possibility of a school district merger often fear that combining districts will lead to a loss of school identity. People may be reluctant to give up familiar school traditions, mascots, and the tight-knit communities they’ve become accustomed to.
Less Individualized Student Attention
Students, employees, and families in smaller school districts are accustomed to the personal qualities of a small school community, such as small class sizes, opportunities for parent involvement, easy access to teachers, and individualized student attention. A transition to a larger combined district may translate to a less personalized experience for students and families.
Longer Travel Time
When a merger occurs, students may need to travel further distances to school, increasing travel time and transportation costs.
Potential Increased Costs for Taxpayers
When two school districts merge, the new district may level up staff salaries and benefits to those of the higher-paying district, raising staffing costs. These higher staffing costs may result in higher property taxes for residents. Increased school transportation costs can also lead to higher taxes.
School district mergers present both potential advantages and disadvantages for communities in New York State, all of which should be considered by districts exploring the possibility of reorganizing. Merger feasibility studies should be conducted in order to thoroughly weigh the potential benefits versus costs for individual communities. For more information on school district reorganization, see NYSED’s Guide to the Reorganization of School Districts in New York State.
While you continue to act in the best interest of your school district, please know that RBT CPAs is here to support your district’s accounting, advisory, tax, and audit needs. Contact us to find out how we can be Remarkably Better Together.