Op-ed: Let State’s Money ‘Follow the Child’ Rather Than Pad District Budgets

Bob Garguilo | May 14, 2015 | Opinion
Fund the Interdistrict Public School Choice in a way that eliminates duplicate spending and nurtures successful program

Bob Garguilo
I have been involved with the state’s Interdistrict Public School Choice Program since its inception in 1999, as the superintendent of Folsom School in Atlantic County.

The program started as a pilot, allowing only one district per county to participate as a Choice School. Folsom School was one of the 10 original schools participating in the pilot — and the results were more rewarding than anyone could imagine. Folsom attracted students throughout Atlantic County, with some students traveling from as far as Pleasantville. For over a dozen years, Folsom received more applicants than space would allow.

In 2010, Gov. Christie signed the Interdistrict Choice expansion bill, which made the program permanent, opened it to any district that wanted to participate, and did away with the county boundaries.

To say that the program is a success would be an understatement. There are 137 schools participating in the program, serving close to 5,000 students. Currently, there are over 1,000 students on waiting lists to enter the program. The popularity of the program is ever increasing, as parents want more choices and options for their children.

But the success cannot be quantified just by statistics and data. Success is derived by the participation of the children in the program.

The 2012-13 cap on enrollment has had a detrimental impact on Choice schools.

The issue is not the cost of the program, but rather a problem with the state’s funding formula, which actually allows for multiple payments for one student — or as some would describe it, the funding of “ghost” students.

When the Choice program was established, aid to the sending district was to be calculated within the Comprehensive Education Improvement and Financing Act (CEIFA). Subsequently, CEIFA was frozen and Choice aid then came to the district as an allocated amount.

In the Choice legislation, the commissioner will annually reduce the state aid entitlement of the school district of residence by the amount of state aid paid to the district of attendance.

Over the course of the first seven years, that never took place — therefore the state was paying for the child three times, giving state aid to the resident district, more state aid to the Choice district, and giving Choice aid to the Choice district.

In 2008, the Legislature passed and Gov. Jon Corzine signed the School Funding Reform Act (SFRA), which took the place of CEIFA.

With SFRA, a new funding silo was put into place that would hold districts harmless if they had declining enrollment; in other words, despite a loss of students, the district was guaranteed to get no less funding than it got in the 2007-08 school year.

Adjustment aid came into being not because of an educational need but rather to ensure that no district lost state aid in the transition from CEIFA to SFRA despite a decline in student enrollment. Under SFRA funding, no school district can receive less state aid than 102 percent of its 2007-08 spending. Thus, the state pays for students who are not there. Adjustment aid was to be eliminated over time at a percent decrease.

In 2010-11, with the rapid expansion of the Interdistrict Choice Program, a formula was developed by the Department of Education’s Finance Office regarding adjustment aid. It amounted to this: As a district received Choice aid for new Choice pupils, it would see an equal reduction in adjustment aid.

Unfortunately, that adjustment was implemented only in the first year (2011-12) of the program’s expansion. Therefore, a Choice district was able to maintain adjustment aid, get Choice aid, and receive state Aaid for a Choice student while the sending district got aid as well. The state can actually be paying for one and the same student in four different aid categories!

The state’s funding formula is causing unnecessary and duplicate costs that are unfair to students, taxpayers, and the Interdistrict Choice program.

Interdistrict Choice is too important to families and students to be undermined by a convoluted system that can be easily remedied.

The Interdistrict Public School Choice Association is asking the Legislature to take a close look at this unreasonable and excessive web of funding streams and to redirect a funding system that will be fair and equitable.

We propose to take the dollar amount of the entire Choice budget and dividing it equally among the number of participants, and that would be the Choice aid regardless of the district’s local fair share in the current formula. That should be easy enough through NJ SMART.

With the above recommendation, there should be a three-year reduction in Choice aid to the Choice districts as follows: Year One – Full Choice aid, Year Two – 85 percent of Choice aid, Year Three – 75 percent, Year Four – 55 percent, and Year Five – No Choice aid.

Districts would know of the phase-out and would be able to budget accordingly. Such a system will allow us to eliminate the caps on growth and allow the money to follow the child.