NJ Legislature Passes New Funding Formula
A couple of months ago, New Jersey Governor Jon Corzine introduced his new plan for distributing state funding to New Jersey schools. Monday night, the legislature finally passed the bill, and Corzine's plan became law.
What does this mean for New Jersey schools? In all likelihood, it will mean a redistribution of state funds from high-need city schools to suburban schools.
For those of you who aren't from New Jersey, it'll help to take a quick look at how New Jersey's schools receive funding right now.
Traditionally, schools were funded by municipal property taxes with a sprinkling of state and/or federal aid.
Through a series of court cases - known collectively as the "Abbott" cases, stemming from the original Abbott v. Burke decision - the New Jersey courts developed a set of guidelines for sending state funding to high-need urban schools.
A group of urban districts challenged the fairness of school funding, on the basis that suburban districts spent far more per student than urban districts. This was followed naturally from the fact that education funding came from local property taxes - which were relatively low in urban areas.
The court found, based on New Jersey's state constitution guarantee of a "thorough and efficient education," that the state needed to send state aid to these urban districts in order to make funding more equitable.
So, today, the state sends out billions of dollars in state aid, and the majority of it goes to urban districts. Districts like Newark get 90% of their operating budget from state funds. Citizens of suburban districts are upset - because their state tax money is being funneled into another district and little of it is coming back to their own districts.
With property taxes as high as they are, few towns want to raise taxes in order to pay for a larger school budget. Likewise, NJ is in no position financially to spend more on state aid to education.
The problem? School budgets keep going up. Teachers salaries' increase - and they need to to keep up with inflation. Heating and utility bills go up. It's natural for it to take more to run a school in any given year than it did the year before.
Corzine's solution? Re-write the distribution formula to look at a set of demographic statistics, and route the money to where it is needed. In essence, he wants to route the money to more districts - including suburban districts that were not covered under the Abbott decisions.
Sending money to these districts isn't necessarily a bad thing, except that it's taking money away from the urban districts. In order to control spending, the amount of aid a district can receive can only grow by so much.
Districts - like Newark - that are already receiving a lot of aid will only get a 2% increase. Districts that weren't already getting a lot of aid could potentially get a 20% boost.
So, in the next few years while this balances out, urban districts like Newark and East Orange will continue to face budget crises. They will not have enough money to operate and to re-hire teachers. Programs will be cut, or people will be laid off. 2% is simply not enough of an increase to continue operating.
Is there a better solution? Probably.
One option would be to make all school funding funnel through the state. It would require a radical restructuring of state and municipal taxes - and the state might have to raise taxes overall to raise enough funding - but then it could easily settle the disparity between funding in urban and suburban districts.
It would at least be better than Corzine's system - which is simply taking money from the areas that need it desperately for education and giving it to those that want property tax relief.
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