Schools - APP - Funding plan puts aid cuts off 3 years

Published in the Asbury Park Press, Monday, December 17, 2007

School aid cuts put off 3 years
Formula caps extra aid, too

By JONATHAN TAMARI
GANNETT STATE BUREAU

If Gov. Corzine's new funding formula were applied today, Jersey City schools would be out $111 million in state aid.

Under the new criteria, other big cuts would be in store for city schools in places such as Newark ($88 million), Camden ($48 million) and Vineland ($42 million).

These districts are among the 31 historically poor, urban Abbott districts that in recent years have received more than half of state education aid, helping them keep their own property taxes down.

The new formula, if strictly applied, would take some of that money away as it requires all communities to pay their local "fair share."

But a "hold harmless" provision in Corzine's plan says no schools will lose money for at least the first three years of the new program, even if the formula says they are already spending more than necessary. In fact, every district will get at least a 2 percent increase this year, regardless of what the formula says.

The hold-harmless provision would cost $860 million next year and help roughly 40 percent of the state's school districts. That's more than the $532 million in aid increases being touted as help for the largely middle-class schools that have received limited increases in state support over the past six years.

And, among the districts now due for massive aid hikes, increases will be capped at 20 percent. For many of those communities, that means a continued reliance on local property taxes to pay for most school costs.

While Corzine hopes his plan will move beyond the two-tier system that has dominated education funding for a decade, the caps and hold-harmless provision represent nods to political, financial and legal realities. They also limit the help and harm the formula could bring in its first year.

If Corzine imposed large aid cuts, the new formula could force urban schools to slash spending and put more pressure on property taxpayers in those communities. A plan with such cuts also would have almost no chance of winning legislative approval and might face a tougher challenge in court, because many of the potential losers are among the districts covered by the Abbott v. Burke state Supreme Court rulings, which mandated enhanced aid for needy schools.

"We are in no way backing away from our commitment to adequacy funding for all of our children, including those in the Abbott districts," Corzine said. "We are trying to draw a different approach to that, and we understand there's going to have to be a transition period."

Administration officials say the aid caps will prevent runaway spending that might result from floods of money heading to some districts. The caps also help control the price tag on the new formula, cutting its immediate cost by $1 billion. Education Commissioner Lucille Davy said the approach ensures an orderly transition into a new, more fair system.

"We didn't get here in one year," Davy said. "I don't think it's really practical to expect us to change the entire thing overnight."

Overall, many districts would do well under the new formula. Roughly half of the state's 616 school district would see aid increases of 10 percent or larger, far more than they have received in recent years.

But Sen. Robert Martin, R-Morris, said that doesn't make up for years of stagnant aid.

"Twenty percent after almost six years of flat funding doesn't begin, at least for some of us, to provide the kind of relief a middle-class community like Washington Township would deserve," Martin said.

Edison is one of the middle-class districts that would receive the maximum 20 percent boost, but the Central Jersey suburb would still have to rely on property taxes to pay at least 80 percent of its school costs. With the added aid, property taxes won't rise as much as in the past, but the township might have actually cut taxes if it received the full complement of aid from the new formula, Mayor Jun Choi said. With limits on annual increases, Edison will have to depend on the state continuing to ramp up funding.

"We're expecting a few years of gains, assuming the state has the money for it," Choi said.

Corzine said he hoped all schools could receive the amounts they are entitled to within four to five years.

Despite the limits, Choi said the caps are generally a good idea.

"You don't want to expand programs too quickly without quality controls on it," Choi said.

With the hold-harmless provision in place, Abbott districts will still receive 56 percent of all state support.

But David Sciarra, an attorney for the Education Law Center, said the hold-harmless funding conceals the impact of a formula that could hurt schools in poor areas. He said that aid was "larded on top" to win lawmaker support and hide what would otherwise be an overall cut in state education support.

Davy said districts would only lose money after the first three years if they have decreasing enrollment or large demographic changes — fewer special-needs students, for example. They also may be required to chip in more money from local property taxes if they have significant wealth gains. The formula generally calls on more affluent communities to pay more of their own costs and sends more state support to poorer ones.

"There's an expectation that communities provide their local fair share, and that's going to be applied to the state as a whole," Davy said.

Asked if some districts will be spared the full ramifications of that requirement by having their state funding sustained at old levels, Davy responded, "I think you could say that."

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