This week, as the deadline approached for filing New York's application for $700 million in federal Race to the Top Dollars, the New York State Legislature did nothing. That's right, nothing.

At the end of last year, New York State Education Commissioner David Steiner and Regents Chancellor Merryl Tisch cued up an ambitious Race to the Top application that would increase accountability, drive improvements in teacher quality and school leadership, encourage turnarounds of failing schools, and expand educational options.

The only missing piece - because it required state legislative action - related to charter schools. Steiner and Tisch urged the Governor and State Legislature to expand the number of charter schools in the state, make charter-school funding more equitable, address facility challenges, and encourage charter schools to serve more at-risk students.

The charter-school legislation was needed to put New York's application over the top. If successful, New York could have received $700 million in education dollars, much needed in the midst of New York's fiscal crisis.

Governor David Paterson proposed lifting the cap to 460 schools, giving charter schools access to state financing for school facilities, and authorizing districts to contract with nonprofit management organizations to help turn around failing schools.

Instead, under pressure from the state and city teachers unions, the Democrats in the State Senate and State Assembly took an entirely different approach. While they were willing to raise the cap to 400, they were only willing to do so if the Governor agreed to a series of "poison pills" designed to curtail charter schools.

In simple words, instead of doing the right thing, the state legislature was preparing to do the wrong thing. When the Governor refused to go along with this charade, the State Legislature's leaders vowed to pass their anti-charter legislation anyway.

In a Mr. Smith Goes to Washington moment, both Houses were stopped in their tracks by freshman State Senator Craig Johnson, a moderate Democrat from Long Island, who along with the Reverend Ruben Diaz, a Senator from the Bronx, refused to provide fellow Democrats with the votes needed to attain the magic 32 votes required for passage. Along with Senate Republicans , led by Senate Minority Leader Dean Skelos, the two unlikely allies favored instead passage of the Governor's bill.

Rather than risk passage of the Governor's competing bill, for which there were 32 votes, the Senate Democrats declined to bring any bills to a vote before the 4:30 p.m. Race to the Top deadline yesterday. The State Assembly then dropped their plans for a vote in their chamber. The cynicism was stunning, even by New York standards.

Trying to shift blame for the likely loss of $700 million in education dollars, New York's teacher unions and Democratic leaders in both houses issued a flurry of press releases blaming the inaction on the Governor. They claimed he was unwilling to embrace legislative proposals to increase charter-school accountability and transparency and to help ensure that charter schools were serving adequately special-education students and English language learners. This simply wasn't true. The Governor conceded each of those issues earlier in the week, and included these reforms in his own legislative proposal.

However, the Governor, with support from New York City Mayor Michael Bloomberg and New York City Schools Chancellor Joel Klein, refused to support proposals by the leadership of both Houses that would have:

• Sharply curtailed the ability of the State University, a well-regarded chartering authorizer, to issue charters;
• Allowed the Regents to determine when and from where charter school applications would be allowed;
• Reopened the Mayoral control bill to place severe restrictions on locating charter schools in public school space;
• Banned charter schools from contracting with private management firms to help run the operations of a school; and
• Driven up renovation and construction costs by subjecting charter schools to the State Education Department's onerous building restrictions and facility approval process.

These proposals would have gutted charter schools and also cost the state important points in the Race to the Top competition.

In the end, a rare rebellion among the ranks saved charter schools across the State from a near-death experience.

What remains to be seen is whether the state can get its act together for the final "round two" Race to the Top application process in June 2010, a process widely expected to be even more rigorous than for the "round one" applications due January 19th.