Big Changes to School Funding in NJ as Fragile Alliance Holds

John Mooney | July 25, 2018 | Education
New law to lessen disparities in aid, and governor promises every district will be fully funded by 2025

Gov. Phil Murphy signed law to change New Jersey’s school funding system on July 24.
Gov. Phil Murphy yesterday signed into law the first significant changes to New Jersey’s school funding system in almost a decade. Filling a school gym for the announcement, the mix of guests at the signing reflected the fragile alliance the governor needed to get the legislation passed.

Murphy was front and center at the event held at Cliffside Park School No. 3, where he declared that the state was finally on a path to closing its notorious gaps in school funding.

The new law phases out various caps and limits that had sustained the disparities in the $9 billion state-aid system, Murphy said, leading the way for major investments overall in public education into the future. The state pays about half of the overall spending on New Jersey’s public schools.

“By 2025, every district will receive the [full] level of aid under the school funding formula,” Murphy declared.

For a start, in the next school year New Jersey public schools will receive an additional $340 million in state aid, and the new law sets a seven-year path to full funding of up to nearly $2 billion more a year.

It wasn’t easy

But this result hardly came easy and there were multiple players involved, including Democratic lawmakers — led by Senate President Steve Sweeney — who stood with Murphy on the stage yesterday after the two had been at odds over enacting the changes.

Meanwhile, in the first row of the audience were top leadership of the New Jersey Education Association, the union leaders who are allies of the governor but hardly best friends with Sweeney and his supporters following years of battle over public employee pensions and benefits.

And behind them were parents and educators from a scattering of districts, their political affiliations less clear but allied in the search for some financial relief for their schools.

Credit: NJTV News
Senate President Steve Sweeney embraces Gov. Phil Murphy at yesterday's signing.
Such was the coalition that came together — at least for now — for the first major reforms of the state’s school finance system since it was enacted in 2008.

“This was one hell of a battle,” Sweeney said when it was his turn to speak yesterday. “This was no easy task. In fact, this was one of the toughest we’ve ever done.”

Months of negotiations

Sweeney said there were several turning points in the months of negotiations with the governor’s office, chief among them addressing the dozens of districts that will take a hit under the new plan. About 170 districts are to take cuts this year, averaging $170,000. They are led by Jersey City, the state’s second largest district, that will lose more than $100 million in aid overall over the seven years.

But in a late compromise, Murphy and Sweeney agreed to throw Jersey City a lifeline in the form of a 1 percent payroll-tax that would go directly back to the schools. The new tax would provide an estimated $60-70 million or more a year, Sweeney said.

“We had to figure out the Jersey City thing,” Sweeney said in an interview afterward. “It was the 800-pound gorilla in the room.”

On the other side, union leaders said more concessions had to be made to protect other districts from harsh cuts. Among them were new requirements for a handful of districts to raise property taxes if they were falling short of their local share of school funding. Another provision called for a loan program to districts that needed emergency help.

NJEA was willing to bend

Credit: NJTV News
Marie Blistan, president of the NJEA
Speaking to NJ Spotlight, NJEA president Marie Blistan acknowledged the union had previously called any cuts in state aid unacceptable, a stance that Murphy initially supported. But, she said, the union was willing to bend after hearing some concessions from Sweeney.

“[The bill] is not what it was before,” said Blistan of the final law. “When you come down to the last day, you are going to compromise, and that’s what this bill is … There are some hits [to districts], but there are also some paths for them.”

Sweeney also credited the final law to the public outcry that came from districts and their families that had seen years of underfunding.

“It was the families,” he said. “Seriously, it was the families that came out to the budget meetings. They were tenacious … The Kingways and the Chesterfields, they started networking with other districts and all of a sudden they realized they weren’t alone.”

In the end, it was noteworthy that all the players seemed in alignment, at least in public, at least on this issue.

When asked if this signals a thaw in the relationship between the NJEA and the Senate President, one of the chilliest in the State House, Sweeney wouldn’t quite commit. Blistan said maybe.

“We just talked a few minutes ago,” she said of Sweeney. “And I’m sure we’ll continue to talk.”