Gov. Andrew Cuomo has signed legislation that spares the Newburgh and Chester school districts a combined $17 million in fines that the state Education Department levied after administrators in those two districts allegedly missed deadlines to file cost reports on past building projects.

State lawmakers from the region had been striving for two years to quash those penalties and ones the state imposed on the Monticello and Roscoe school districts for similar reasons. Cuomo vetoed bills to waive penalties against three of the districts six months ago but reversed course on Monday, calling the fines against Newburgh and Chester "unusally high" in a message issued when he signed the bill.

Cuomo wrote that Newburgh's $12.75 million penalty was the highest in the state and that Chester's $4.58 million fine "represents more than 15 percent of the district's annual budget."

"These penalties, a result of paperwork errors made years ago, are outrageously disproportionate and would have had a devastating impact on these two school districts and their taxpayers," state Sen. James Skoufis, a Woodbury Democrat who sponsored the bill, said in a statement on Tuesday.

Assemblyman Jonathan Jacobson, a City of Newburgh Democrat, also sponsored the legislation, which was approved unanimously by the Senate on May 15 and the Assembly on June 4. Assemblyman Colin Schmitt, a New Windsor Republican who represents Chester, also cheered the bill's signing on Tuesday, calling it a victory for "taxpayers and students who would’ve been unfairly burdened by these penalties."

Both districts had faced a deadline of Friday to pay installment of their penalties.

Chester Superintendent Sean Michel, who is retiring on Wednesday, said the state's fine would have been "devastating for our small school district." The district already had sued to challenge the fine, which Michel said on Tuesday had resulted from the state Education Department waiting two weeks to time-stamp a report that Chester officials hand-delivered in Albany on the deadline day in 2012.

Michel said that report detailed the costs of two past building projects, including the $25 million construction of the Chester Academy that was completed in 2004.

State lawmakers also have approved two separate bills forgiving similar penalties of $1.9 million against the Monticello School District and $1.4 million against the Roscoe School District. Those proposals, sponsored by Sen. Jen Metzger, D-Rosendale, and Assemblywoman Aileen Gunther, D-Forestburgh, had not been delivered to Cuomo to sign or veto as of Tuesday.

Cuomo's bill-approval message indicated that the state changed how it issues aid payments for school construction in 2011, but that "a handful" of districts" later found that they owed final cost reports for previous projects. That subjected those districts to "large building aid penalties."

cmckenna@th-record.com