School & District Management

N.J. Governor Seeks to Overhaul School Financing

By Catherine Gewertz — December 10, 2007 4 min read

New Jersey’s governor has proposed a controversial school finance formula that would eliminate the special-needs-district designation that has brought billions of dollars in extra assistance to the state’s poorest urban school systems.

The plan, released Nov. 30, suggests adopting a statewide formula that is designed to gear aid to the relative needs of students and their communities’ ability to pay for their education. Currently, New Jersey policymakers adjust school funding for some districts based on enrollment growth, and for others by specific need, without any overarching formula applied to all 616 of the state’s districts.

The state’s poorest 31 urban districts get money through a unique calculation generated by a long-running state supreme court case called Abbott v. Burke. It guarantees them funding on a par with the state’s wealthiest districts, and additional money for facilities and a broad array of programs such as universal preschool.

Gov. Jon S. Corzine, a Democrat, wants a new funding method in place for the 2008-09 school year, but some education activists were skeptical that could happen, since the state budget must be signed by June 30.

Any new system must pass the state legislature, which took a year to finalize the last school-funding formula in the mid-1990s, only to see it declared unconstitutional for the poorest districts and, later, not fully funded or implemented for the rest. Gov. Corzine and top education leaders also want the state supreme court to review the plan to ensure that it meets the equity aims of the 26-year-old Abbott case.

Few Specifics Yet

The governor hopes the legislature will approve his plan before Jan. 8, when a new session begins with dozens of new members. But some advocates argue that lawmakers should not rush approval of such a complex and important matter.

“It’s unreasonable to expect something this complicated to come together with any degree of comfort that fast,” said Lynne Strickland, the executive director of the Garden State Coalition of Schools, which advocates for the interests of middle- and upper-income school districts.

The governor’s funding proposal comes amid years of debate about how to address inequities in school spending in a state known for its heavy spending on education while also lowering its highest-in-the-nation property taxes. A special legislative committee recommended an overhaul of New Jersey’s funding methods a year ago. (“N.J. Panel Eyes Changes in School Funding,” Nov. 29, 2006.)

Gov. Corzine’s proposal contained no district-by-district dollar figures, leaving local officials uncertain of how they would fare under the new formula. But those figures were expected as early as this week.

The governor has pledged about $450 million more annually to meet the needs of the state’s 1.4 million students under his new plan, which would represent about a 4 percent hike over this fiscal year’s $11 billion appropriation.

Some activists wonder whether that would be enough to keep Abbott programs intact and extend help to additional places in need. They also note that the state is in a tough funding spot: with an annual budget of $33.5 billion, it is projecting a shortfall of $3 billion for fiscal 2009.

The proposal envisions no special-needs designation for any subset of districts, such as the Abbott districts, or another, low-income group that also gets targeted funding. Instead, it adopts a commonly used statewide approach that establishes the same base cost in each district for regular education at the elementary, middle, and high school levels, and adds “weights”—additional dollars—for low-income, special education, English-learner and other high-need students, regardless of what kind of district they live in.

Districts would get additional money for each child in those categories, plus extra funds per child on a sliding scale once their portion of low-income children reaches a certain level. In that way, the new formula can account for changing demographics and address concentrations of need wherever they arise, in Abbott districts or elsewhere, said Commissioner of Education Lucille E. Davy.

“This is not an attempt to undermine or walk away from what the court attempted to accomplish,” she said in an interview last week. She noted that the governor’s plan expands the Abbott districts’ universal preschool program to scores of additional low-income, non-Abbott districts.

District-level Concerns

David G. Sciarra, the lawyer who represents the plaintiff schoolchildren in the Abbott case, said the funding proposal ignores the New Jersey Supreme Court’s finding that districts serving poor, urban children should be able to spend what the richest districts spend for added programs and services to offset the effects of poverty. Base funding amounts being discussed at the education department, he said, would mean that many Abbott districts would get amounts closer to the state average than to the levels of the wealthiest districts.

Ms. Strickland said she welcomes a unified approach to school finance in New Jersey, but worries about other aspects of the new proposal.

The districts she represents object to a change that would require wealthier districts to shoulder a greater portion of their special education costs, she said. New Jersey has a particularly large share of students with autism. She said her member districts could see their property taxes rise even higher to pay for special education.

Marie S. Bilik, the executive director of the New Jersey School Boards Association, said the funding proposal does nothing to solve the biggest underlying problem in education: heavy dependence on local property taxes, which places the biggest burden on low- and middle- income homeowners. The association believes the state should pay for a greater portion of total school costs—it now shoulders about 37 percent—and should substitute income taxes for a portion of property taxes as a source of school funding.

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