While the revenue side of New Jersey’s next state budget remains shrouded in uncertainty, there finally appears to be agreement — or near agreement — on the biggest and arguably most contentious section on the spending side: state aid to public schools.
Democratic leaders in the Legislature yesterday moved forward on changes to the state’s $9 billion school-funding package for next year, saying it will put the state on a path to fully funding the 2009 law within seven years.
The changes are significant, with the latest amendments presented yesterday adding another $65 million in overall aid beyond the $283 million in additional aid that Gov. Phil Murphy proposed in his spending plan for next year.
But it would also maintain cuts to the more than 200 districts that have been receiving aid above the formula, albeit with new limits to those reductions. Among them would be Jersey City, now limited to a $3.5 million reduction next year, and Freehold Regional, which would lose $1.3 million.
Cap and cut
Murphy had resisted any cuts at all, but in a noteworthy exception, the legislators capped the cuts to some districts, depending on their circumstances, and added an amendment that would force taxpayers in 36 of those districts to make up at least some of those cuts in local taxes.
Unprecedented in a New Jersey school funding law, the amendment would require those districts spending less than what the formula deems “adequate” but falling short of the formula’s “local fair share” to raise their local tax levy by a minimum of 2 percent. They include districts such as Toms River, Brick, and Seaside Park.
But some sizable increases will be coming, too. Newark is the biggest winner in the state, retaining the $37 million boost proposed by Murphy. But Atlantic City and Woodbridge will both see an extra $3.5 million under the Legislature’s plan, and Monroe an additional $2 million.
Two of those held up as the most underfunded — Kingsway and Chesterfield — will see $2.1 million and $1.6 million more, respectively.
Murphy has yet to speak publicly to the specifics of the latest bill, but legislative leaders and their staff said it came out of negotiations with the governor’s office in what has been one of the rare instances of cooperation between the two branches.
Attending the Senate hearing yesterday, Murphy spokesman Dan Bryan agreed the negotiations had brought the two sides “very close” on school funding. But he stressed it would ultimately be decided in budget negotiations that are far from settled.
“We are very close to agreement on school funding, but we are in agreement on just one side of the ledger,” Bryan said. “We are in agreement on spending, we are not in agreement on revenues.
“There is no school funding agreement without a revenue agreement, we have been very clear on that,” Bryan said. (Murphy has a press event planned at the state Department of Education today that is expected to highlight those differences.)
Clearing both houses
Nevertheless, the Senate and Assembly budget committees’ endorsements of the bill yesterday and its likely final approval in the next week mark a turning point. It has taken years of debate and discussion to decide how to fulfill the funding formula as it was written in 2008 and approved by the state Supreme Court as part of the landmark Abbott v. Burke rulings.
As such, there was an air of celebration at the Senate hearing yesterday, where the committee chairman, Sen. Paul Sarlo (D-Bergen), led a bipartisan chorus of thanks to the parties involved — especially Senate President Steve Sweeney, the chief architect and cheerleader.
“It has taken a long effort, a lot of public hearings over the last two years,” Sarlo said.
The thanks even came from a representative of the New Jersey Education Association, the teachers union that has been in open battle with Sweeney and the Democratic leadership for months, if not longer.
“I want to thank the Senate president for keeping this as part of the conversation,” said Osomo Thomas, the NJEA’s associate director of governmental relations, in opening his comments.
And by and large, those comments were pretty conciliatory, given that their subject was a bill that likely will cause hardship for some of the union’s members.
A lot to like?
“We are still digesting and looking at it, but we like several of the things we just heard,” Thomas said. “We like it would increase funding to address the years of underfunding under previous administrations…
“We like that it directs aid to districts that are most underfunded, and we like that it gives districts [facing cuts] sufficient time to adjust to this new reality.”
The limits on the cuts were a critical element, as Sweeney and Murphy had differed on phasing out more than $600 million in so-called adjustment aid that had previously protected districts that were seeing a drop in enrollment.
But in a compromise, the amendments provide new protections for some of the districts, and even give the state education commissioner discretion to maintain funding for districts that fall under the Abbott v. Burke rulings. That amendment was an olive branch to the state Supreme Court — and advocates for the Abbott districts — that have protected funding for them for decades.
Districts standing to gain under the changes were thankful yesterday that the path appears set toward full-funding. The Senate majority office has yet to release the district-by-district breakdown, but officials said every district would be at least at 58 percent of full funding after the first year, lifting up nearly 150 districts now below that level.
These bills are “a historic opportunity to set a sustainable path toward school funding equity in New Jersey,” said Kennedy Greene, superintendent of Newton schools and a leader in pressing for full funding.
“The major elements — elimination of aid growth caps, redistribution of over-aiding over seven years — are essential to fairness for all children and their families.”