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Legislative Spotlight Burns Hot and Bright on Aid Cuts, School Construction Delays

New education commissioner and head of development authority face tough questions about Christie administration’s policies and tactics

Acting Commissioner David Hespe
Acting Commissioner of Education David Hespe

New Jersey’s fiscal 2015 education budget – which every year accounts for more than one-third of overall state spending -- got a public airing yesterday with some familiar themes but also some somber warnings of looming financial shortfalls.

Much of the three-hour hearing before the state Senate’s budget committee centered on K-12 education funding, with Acting Commissioner David Hespe making his first appearance before the Legislature since Gov. Chris Christie appointed him to the post last month.

Hespe had the task of defending an unpopular budget that is providing less than a 1 percent increase in state aid to schools districts – amounting to $20 more per student – and leaving aid for 80 percent of the state’s districts at or below levels in 2010.

But even more difficult moments came when legislators grilled the leader of the Schools Development Authority, which oversees school construction in the state and announced that the multi-billion-dollar program was nearly out of funds.

The SDA usually plays second fiddle at budget hearings, but the agency’s new executive director, Charles McKenna, got some prime-time attention as discussion centered on projects that have been long-stalled under Christie.

Most of the questions came from state Sen. Teresa Ruiz (D-Essex), a member of the budget committee and chair of the Senate education committee, who pressed McKenna on the slow pace at which construction money has reached districts over the last decade – funding ordered under the Abbott v. Burke school-equity rulings.

During the discussions, it was revealed that the SDA is down to its last funded projects under the court order that saw the state borrow more than $8 billion for school construction since 2002.

McKenna, a former counsel under Christie until his new appointment, said just $350 million remains.

A host of pending projects are already covered financially, he emphasized, including the long-discussed Trenton High School repairs and upgrade..

But after that and other approved projects are completed, McKenna said, only limited funding will be available for other construction unless the Legislature approves additional borrowing.

“I’m not sure we have all the money we need to deal with all the projects,” McKenna said in response to Ruiz’s questions.

He said the SDA would likely need to ask the Legislature to authorize additional borrowing, a lengthy process in itself. He also maintained it would likely need public approval through a bond referendum, although others said school construction could be exempt.

“That is something we would need to be in contact with the governor’s office and may very well need public approval,” McKenna said.

But Ruiz pressed him on whether the SDA has pushed hard enough to complete projects that already have funding.

“The length of time from conception to completion is extraordinary, it is frustrating,” she said. “I just don’t understand what takes so long.”

“If we have $350 million in hand somewhere, I am sure there are several districts that can indicate how the money should be spent,” she said. “Let’s appropriate this money into projects, let’s get people working, and let’s get children into safe and adequate schools.”

Flak over school-aid formula

Hespe faced questions about the Christie’s administration’s failure to use the state’s school-funding formula in determining state aid for 2014-15.

Hespe readily acknowledged that districts were given the equivalent of $20 more per student, regardless of need.

But state Sen. Paul Sarlo (D-Bergen), chairman of the budget committee, immediately pressed Hespe on whether the state needed to at least follow the state’s School Funding Reform Act, even if it doesn’t fully fund the amounts.

The backdrop to the questioning was a new legal challenge from the Education Law Center, the Newark-based group that has led the Abbott v. Burke litigation, which contends that the administration’s failure to even run the formula violates the state’s obligations.

Hespe said yesterday that his department will indeed provide the information demanded in the ELC’s motion. In the next few weeks, he said, districts will receive new state-aid summaries detailing what they are entitled under the SFRA.

Details are still being worked out, he said, including how specific weights for different student demographics will be used. But Hespe sought to reassure the committee, saying, “I think that should satisfy the requirements.”

David Sciarra, executive director of the ELC, said yesterday that he was encouraged by Hespe’s comments but was waiting to hear the details.

“We’re eager and ready to work with the commissioner to have him issue state aid notices that are fully compliant with the requirement of the formula,” he said. “We’d be very happy to get this resolved so that the court doesn’t have to get involved.”

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