Governor Andrew Cuomo is threatening to impose a teacher evaluation deal on the city and teachers union if the sides cannot agree to one on their own.
Cuomo says he will propose a law allowing the state's education department to develop a system to evaluate city teachers if a deal is not reached by September 1.
"Now you're in a situation where the city of New York has not come to terms, they've lost one round of funding," Cuomo said. "This could theoretically happen again. Not only do you lose, as I mentioned before, the state funding, you're in peril of losing the federal funding, which is truly significant. So, it is an extraordinary circumstance."
As much as $450 million in aid and grants are on the line.
The city has already lost $250 million because no deal was reached by a deadline two weeks ago.
"While I haven't fully examined the governor's proposal or the exact language of it, I think it's appropriate to put in place a system of default to make sure that children don't lose the resources," said Assembly Speaker Sheldon Silver.
In his budget last year, the governor tied an increase in state funding to an evaluation agreement. The union and the city had until January 17 to make deal, but they failed.
The governor is tying state money to an agreement again in this year's budget.
Most other state municipalities have been able to meet the earlier deadlines for a deal.
On Monday, Mayor Michael Bloomberg was in Albany, where he asked lawmakers not to punish city schoolchildren by withholding funds. He was asked why most districts around the state were able to come to terms.
"Because everybody else is just interested in getting the money and committing what I would call fraud," he said.
Most districts only agreed to deals that expire after one year.
"The law that we passed was not intended to be a one-year law or a two-year law," Cuomo said. "We want a teacher evaluation system in place, period."
"If SED is facilitating it, at least I know now, across the table, I'll have educators who will actually understand the issues, which I seem not to be able to get the city to understand at this point," said Michael Mulgrew, president of the United Federation of Teachers.
Mulgrew issued a statement Wednesday in response to the governor's remarks, which read, "While we would prefer a negotiated settlement, it's good to know that should the talks fail again, people who actually understand education will be part of the decision making process."
City Hall officials released a statement Wednesday evening, which read, "We are in active discussions with the UFT and, out of respect for those conversations, will reserve comment."
It's not clear what the evaluation system would look like if the state imposed one. It's also not clear if that will act as further incentive for both aides to reach an agreement. The loss of money clearly did not motivate both aides to reach a deal.
Cuomo On Teacher Evaluations
NY1: Cuomo May Force City Teacher Evaluation Deal
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Watch Governor Andrew Cuomo's Wednesday remarks on the need for a teacher evaluation system in New York City.