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Thank you to members of the Senate Budget and Appropriations Committee and Chair Sarlo for allowing me the opportunity to testify regarding the proposed Fiscal Year (FY) 2024 Budget...'
Thank you to members of the Senate Budget and Appropriations Committee and Chair Sarlo for allowing me the opportunity to testify regarding the proposed Fiscal Year (FY) 2024 Budget. My name is Charles Sampson, and for the past twelve years I have served as the Superintendent of the Freehold Regional High School District (FRHSD). Freehold Regional is the largest limited. purpose district in the State, serving well over 10,000 students from eight municipalities with a wide range of District Factors Groups ranging from C to I. I am proud of the district's outstanding track record in both academic and fiscal performance measures, and I thank you for the opportunity to share my perspective on the intersection of this proposed budget, post pandemic realities, and the pernicious impacts of Senate Bill 2 on our schools and communities.
I have provided testimony to the Senate and the Assembly in the past regarding the negative impacts of S2. The implementation has continued for six years. So, rather than spend time rehashing my sharp disagreement with the implementation of S2 itself, I want to take a brief period today to demonstrate the arbitrary and severe consequences of the legislation to districts across the State and to offer some solutions - solutions that we have asked to be implemented
since 2018.
What S2 has created is a number of districts on the verge of being insolvent and unable to provide a thorough and efficient education for their students. Here in the FRHSD we are now $20 million dollars below the adequacy line with an ability to generate $2.8 million on the tax levy. We are the lowest per pupil spending district in Monmouth County. Even though we are a high school only district, the cost of educating such students in NJ is considerably higher than that of K6, K8, and K12 districts. Our students will be chronically shortchanged. We have cut 112 positions to date, engaged in a $20 million-dollar ESIP program, and passed a referendum for $15 million dollars for roofing and paving work and still have a dangerous lag to maintaining our infrastructure and have over 400 individual classes that have 31 or more students enrolled. This has occurred with the $21 million we have already absorbed in draconian cuts. We will gut the district with what is now $28 million in cuts. ($24 million depending upon final legislative approval).
The funding formula is supposed to be predictable under the SFRA - the implementation of S2 has been anything but predictable. The SFRA is defined in the opening paragraph of A Formula for Success: All Children, All Communities:
...to develop an equitable and predictable way to distribute State aid for education."
S2 has been anything but consistent, equitable, or predictable. The Department of Education gave no indication to any district leaders that in some instances our cuts would be 4 and 5 times worse than anticipated.
I will illustrate the variance and lack of predictability for the Committee:
Driving the FY24 state aid reduction to FRHSD is the calculation of the Local Fair Share. The state's determination of a community's ability to locally fund education (regardless of community ability to raise those funds). The multipliers that convert the district's income and property value into the community's ability to pay are highly volatile. Consider this:
o If the FY23 multipliers were used for FY24, FRHSD's state aid cut would be $474,000 instead of $6,763,723. That's 14 times higher-purely from a year over year change in the multipliers, a calculation that the State has yet to disclose.
o FRHSD's district income went down by 1.5%, yet the community's ability to pay based on income increased by 10.2%.
o FRHSD's LFS is $30+ million higher than the tax levy. It would take over a decade to reach today's LFS taxing at the maximum of 2%.
o The inability to access the LFS has driven FRHSD further below adequacy by an additional $9 million in FY24. The district will now be operating at $20.4 million below the thorough and efficient spending benchmark.
o FRHSD's LFS has increased by 86% from FY09 to FY24 despite property value and district income only increasing 37% and 63% respectively. FRHSD's LFS is 70% higher today than if the wealth multipliers had remained the same during that time.
Under S2, FRHSD has lost 54% of its state aid, the percentage of state aid supporting the budget has dropped from 26% to 12%, while enrollment has declined only 6%.
In all of this, we have addressed the exploding student mental health needs and expanding security concerns. In the past two school years alone, and only to date, we have addressed over 315 instances of students threatening self-harm or harm to others. The year prior to Covid, we had 55 HIB instances, and we are pacing for 187 this school year. Since the Parkland shooting, we have added 12 security officers across our district. We have been unable to add additional counselors or other support mechanisms and the District is now teetering on a dangerous precipice of not being able to properly educate our students nor meet their mental health needs as we are squeezed even further by an arbitrary destruction of our school system. The recommendations I ask this body to consider today are the same recommendations we have made for five years now. They include:
Adjust the Adequacy Budget for aid calculation purposes to account for specifically identifiable costs that skew a district's position in relation to adequacy. In FY23, full time vocational students cost FRHSD $7.7 million for tuition and transportation, none of these costs are considered in the calculation of Equalization Aid.
Provide meaningful relief for districts spending below adequacy and taxing below their LFS. The 2% cap on the tax levy increase prevents districts from accessing their LFS in accordance with the SFRA calculation. Currently, there is no pathway for districts like FRHSD to reach adequacy. State aid cuts should be limited to the available tax levy increase (stop the bleeding).
Allow second questions to be prospective so that communities can choose to increase the tax levy above the 2% cap for use in subsequent budget years (or, can choose to provide a thorough and efficient education). So, for instance allowing a vote to increase the tax levy to 4% on the November 2023 ballot to be used in the 24-25 school year so that districts can adequately plan for sharp reductions.
Ensure equalized valuation and district income are a complete and accurate representation of a community's ability to pay LFS.
Stabilize wealth multipliers by limiting year over year changes. The SFRA was not designed with a tax levy cap in place. The LFS should work in tandem with the tax levy
cap.
Most importantly, we need to look now to life beyond S2 and ensure that next year, the final year of these drastic cuts through S2, there is a clear plan in place to for every district in New Jersey to receive adequate funding. Presently, many S2 districts that are millions of dollars below the adequacy line will once again face drastic reductions. These cuts will be neither equitable nor predictable.
Respectfully submitted,
Dr. Charles B. Sampson Superintendent of Schools
