GARDEN STATE COALITION

     OF SCHOOLS/GSCS

210 West State Street,

Trenton, New Jersey 08608

Testimony before the Assembly Budgets and Appropriations Committees

State Budget FY08

March 13, 2007, Statehouse Annex, Committee Room 4

Good afternoon, Mr. Chairman, and members of the Committee.  I am Lynne Strickland, Executive Director of the Garden State Coalition of Schools. Today GSCS represents over 150 school districts throughout the state, lower to middle to upper income districts that share a common denominator interest in quality education, as well as public and state support for public education. Together our member districts serve well over 400,000 children.

Thank you for the opportunity to provide brief comments before you today on the State Budget for FY2008.

There are points on which we all agree at this time:

Property taxes and school funding are inextricably linked;

A new school funding formula has yet to be developed; the old formula CEIFA has not been implemented, nor updated by enrollments or CPI increases, going into the sixth year. An implemented, equitable school funding formula is an essential component necessary to achieve real property tax relief and offers viable potential for property tax reform.

Unfortunately, the property tax burden will not be relieved in the overwhelming majority of our towns and school communities again this year. GSCS - its students, parents, educators, all its concerned members - asks you to get a school funding formula in place with all due speed.  

While Governor Corzine deserves a nod of credit for recognizing that schools simply could not go another year with no funding increase, his budget proposal still remains a stopgap approach. Unless and until the state takes the final step of leadership to revise our school funding formula and restore overall equity, predictability and stability to the school funding process, our schools and property taxpayers alike will continue to suffer."

The Joint Committee on Public School Funding , co-chaired by Senator John Adler and Assemblyman Herb Conaway, was ready with its recommendations for a new school funding formula by November 15, but the recommendations never got translated into bill form and the public was let down from its expectations of productive debate on the issue; the need - and hope  - for the permanency of  comprehensive school funding reform yet again delayed.

Given this current situation of “where we are today” and “where we are headed” tomorrow, certain nagging, negative points re-emerge that need to  be noted and should be considered in the legislative debate during the Appropriations Act process for FY08.

·         The flat formulaic funding of our schools, which amounts to approximately $2.2B over these past 5 years, is a direct tie-in to the growth in property taxes; in addition, an estimated $557M in special education entitlement aid has not been funded to disabled , special education students in the same timeframe;

·         The costs of health benefits and special education alone accounted for over 61% of property tax increases for schools from similar time span (FY02-FY06);

·         Extraordinary Special Education Aid has only been fully funded once at 52M – in recent years according to its legislated obligation; last year that obligation rose to approximately $174M meaning that property taxpayers had to fund $122M of the difference. This year it will be even more.  We ask you to review that funding and consider meeting this obligation – for the same reasons you found worthy before – this aid goes to the neediest of our children, no matter where they live, and helps to stabilize school budgets in difficult years.

·         State mandates still stand out as budget cost drivers that local districts must fund. By its own count, the Department of Education’s recently released list of regulations that extend beyond IDEA requirements stands at 78. We are not arguing the intent of the DOE’s rules, but we note to you that these are costs that are outside of local district control.

While the Governor’s budget goes a way to help targeted children at risk and supports districts with full day kindergartens where the wealth-based calculations permit, the context of static school aid has taken its toll on all our communities and budget stressors will not go away.

·         In Matawan-Aberdeen, for instance, (which is grateful it is receiving aid for its full day kindergarten program) an increase of 18 cents and 22 cents is still anticipated to be needed in its property taxes to support it upcoming budget; last year those increases were 20 and 24 cents and school budgets have failed there for the past 5 years in a row.

·         In Edison, the district misses the at risk aid mark by a few percentage points yet still has a high number (near 1,000) of at risk students, combined with high growing enrollment rates.

·         The increase of 3% across the board for all communities is based on CEIFA calculations that are at least six years old; demonstrative of this static fact is that this $93M is virtually the same number as when Governor McGreevey  issued a similar 3% increase to districts several years ago.

·         The higher a district’s entitlement to state aid, in 2001-2002 terms, the larger the 3% figure will be; conversely, the lower a district’s aid was those many years ago, the lower the aid dollar will be for a school community in FY08 –  “… For instance (per New York Times, 2-27-07), the Glen Ridge school district in Essex County will have a modest 3 per cent increase in state aid, or about $29,000 – barely enough to make a difference in its current $23M budget…”  We need to remember that approximately 45% of New Jersey’s regular operating (Non Abbott) districts are deemed to wealthy by the CEIFA calculation to receive any basic state core curriculum aid.

·         Starting three years ago, the state reupped its requirement that school communities contribute to the PERS (Public Employee Retirement System) fund for non-certificated staff; next year that percentage will increase to 80%, and the following year school district contributions will arrive at the 100% figure. A $55,000 salary today requires towns to pay about $2,500 per PERS school employee. In Ewing, approximately 20%—25% of its staff is under PERS.

·         ‘The last state aid payment’ in the 12 month payment cycle to schools that was held off – stated to be “borrowed” in the early McGreevey years - still is not schedule to be re-paid to schools.

What can we point to as a positive step from Trenton that begins to resolve fairness in school aid support for all New Jersey communities, balanced by state acknowledgement of the role state school aid plays in relation to increasing local property taxes?

Again, the legislature can take the high road lead to help offset local property taxes, and thus help local taxpayers, through the vehicle of special education state support aid. This can be accomplished by meeting the state’s own laws, and bringing this aid up to date to FY07-08 levels. The result would be more equitably distributing school aid via special education school funding to virtually all of our school communities, with a direct and positive impact on the individually disabled students.

We urge the legislature not to ignore one of the most basic responsibilities of our state government: that is, to bolster those public school children in need no matter where they live - middle income, and lower income and wealthier communities. In particular, to provide extraordinary special education aid to severely disabled children, regardless of where they live, sends a positive two-fold message to New Jersey citizens: that, on the side of good governance, the legislature cares deeply about the public education of our neediest children, and two, that the legislature recognizes the rational role that state school aid plays in offsetting property tax increases tied to state-mandated programs.

We look forward to working with you on this issue and the school finance discussion as it progresses.

Thank you in advance for your consideration of GSCS’ concerns, comments and suggestions.