Legislators Consider Cap Exemption for Special Ed Costs

School leaders, citing ‘extraordinary costs,’ call the issue critical as Assembly prepares for Monday vote on 2 percent property tax cap

The high cost of special education has become the latest point of contention in New Jersey’s drama-filled path toward a new property tax cap.

On one hand, most agree it’s an increasing burden on districts across the state. But do extreme cases need to be excluded from the cap altogether when relatively few districts have
sought such waivers as it is?

The Assembly is expected to approve a new 2 percent cap on Monday, when they hold a special session to vote exclusively on the agreement reached between Gov. Chris
Christie and Senate Democrats last weekend. The Senate approved the measure by
a 36-3 vote yesterday.

But in both chambers, lawmakers have increasingly heard calls that extraordinary special education costs for children with significant disabilities should be among the
possible exemptions from the cap.

The bill approved by the Senate includes only health care, pension and debt service costs on the list of exemptions. The cap could also be exceeded with majority
approval of the voters.

‘A Huge Issue’

With the Assembly poised to vote on the deal, Speaker Sheila Oliver this week reiterated that special education remains a critical piece that should be considered for exemptions — if not in the cap bill itself, then in a separate bill.

“Special ed is a huge issue for many of the communities, and there is no exception in the current bill to address special ed costs,” Oliver said. “Special ed costs can
bankrupt a community.”

In a state with the highest known autism rate in the country, for example, Oliver noted that many districts face costs as high as $100,000 per child when transportation
and other services are included.

“And no consideration is given for that under the current proposal on the table,” she said.

Payments to 500 Districts in 2009

Much of the attention is on these so-called extraordinary costs for children with significant disabilities, many of them attending separate public or private
schools at the local districts’ cost.

The state now pays some of the costs exceeding $40,000, last year paying out $139.9 million to about 500 districts, according to state data. The largest payouts went to a mix of districts, large and small, urban and suburban. They include Lakewood ($2.7 million), Bernards Township ($2.4 million), Fair Lawn ($2.4 million), Woodbridge ($2.3 million), Edison ($2.2 million), South Orange/Maplewood ($2.2 million) and Newark ($2 million).

Under the current 4 percent cap, districts can seek waivers for increases in those costs that the state does not cover. But so far, Senate leaders appear to be balking at adding special education to the legislative bill, because few districts have sought those waivers.

“Last year, there were 11 requests, out of 600 districts, and only seven approved,” said state Sen. Teresa Ruiz (D-Essex), chairwoman of the Senate’s education committee.

“In light of that, it sheds a different perspective,” she said. “If you think about the dynamic of 600 districts statewide, that’s a small number.”

Senate President Stephen Sweeney (D-Gloucester) said they weren’t much higher the year before, either, but he added it would be something that his members could keep a close eye on in case the statute needs amending.

He was the lead Democrat in negotiating with Christie to make the cap statutory and not by constitutional amendment, as the governor initially proposed.

“These aren’t big numbers, but surely they are big issues,” he said. “If it becomes a problem, the beauty of the statutory cap is we can put it back in.”

Sweeney yesterday created a task force that he said would further review any budget issues that need to be addressed under the new cap, and he said special
education would surely be one of them.

“If we had done Christie’s cap, people should be very worried, but with the cap we did, we can go forward and address it, if we need to,” he said.

Consider Costs Now

Still, school leaders said the special education costs need to be considered now as the cap is finalized. They conceded that waiver requests weren’t numerous, but
that doesn’t lessen their impact on individual communities.

“For the individual districts affected, it’s critical,” said Frank Belluscio, a spokesman for the New Jersey School Boards Association, which has called
specifically for a special education exception.

“And if you look at it philosophically, it’s a prime example of a cost out of a district’s control,” he said. “They have no choice but to provide services at level.”