This is obviously a very fluid situation and last minute changes are always possible. We are staying close to these issues and are focusing our immediate efforts to keep you informed, as well as to maintain a high level of awareness in the statehouse for our members’ key areas of concern.

Garden State Coalition of Schools/GSCS FYI 2-9-07 RECENT LEGISLATIVE ACTION- IMPACT ON DISTRICTS To: Garden State Coalition of Schools Members Fr: GSCS & School House Strategies Re: Trenton Legislative Action 2-5-07 Garden State Coalition of Schools/GSCS FYI 2-9-07 RECENT LEGISLATIVE ACTION- IMPACT ON DISTRICTS To: Garden State Coalition of Schools Members Fr: GSCS & School House Strategies Re: Trenton Legislative Action 2-5-07 There is a lot of confusion regarding the recent legislative action this week. Here are the key provisions of each of the passed/pending pieces of legislation. Our information is based on the interpretation of the Office of Legislative Services. This is obviously a very fluid situation and last minute changes are always possible. We are staying close to these issues and are focusing our immediate efforts to keep you informed, as well as to maintain a high level of awareness in the statehouse for our members’ key areas of concern. Please go to www.gscschools.org for continued updating and GSCS-recommended member actions regarding Trenton’s developing legislation and impacts. At this time, GSCS is asking the Governor to conditionally veto 2 requirements in A1: 1) The supermajority of 60% of the voter turnout required to pass separate questions. 2) The stipulation that effectively caps the health benefits exemption at the level of growth in the State Health Benefits Plan. Approximately 60% of local school districts participate in private carrier health insurance plans because they have found it less costly do to so. By tying the health benefits exemption to the SHBP is may have the unintended consequence of drawing back districts to a more costly program overall. The marketplace should be the deciding factor for districts, not a legislative disincentive that could impede fiscally responsible choices. We urge members to call the Governor at 609 292 6000 to request he conditionally veto A1 as stated above. Thank you as always for your commitment and effort. Bill Highlights/Initial review: A1 Tax Levy Caps bill (Passed by both houses of the legislature, on the Governor’s desk) A ‘cap’ of 4% is statutorily imposed on the school property tax levy, beginning FY07-08. Given the 4% tax levy cap, the Office of Legislative Services has interpreted the legislative intent of the bill A1 to “set aside” the CIEFA cap of 2.5% or CPI whichever is greater. Other elements of S1701, such as 2% maximum on surplus (unrestricted reserve) and administrative cap remain in effect. Budget Vote: Required vote on the ‘Base Budget’ remains in place. FY 07-08 –Same process as last year, for both vote on the base budget overall and separate questions as well. FY 07-08, per CEIFA, there is no appeal of municipal determination should a separate proposal fail. Beginning with the FY 07-08 budget vote, separate proposals require a 60% supermajority of the votes cast. The Commissioner must provide ‘emergency’ regulations on the bill within 60 days of its enactment. Allows for more flexibility in reserve accounts in transferring funds into reserve accounts. Also a new account has been established under A1 that allows for the establishment of a current expense emergency reserve; A4 The CORE Plan Passed, with amendments (1. appeal of Executive County Superintendent {ECS} budgetary action/decision to Commissioner, and 2. moving the school board member elections back to April) by the Senate on 2-5-07; A4, as amended, must then be voted on in the Assembly in order for bill language to be identical; after the Assembly passage to bill will go to the Governor’s desk for final disposition. Separate proposal requirement In FY 08-09, in order for a district to propose a separate question, the ECS requires that districts either make demonstrated efforts to share services, or are currently sharing services, or can show that the current sharing of services has not saved the district money. Budget oversight: The ECS reviews all district budgets and may disapprove portions of the budget; further the ECS will then require that portion to be deducted prior to the budget’s publication. Appeal process: Appeal to Commissioner of Education permitted regarding ‘budgetary action’ by Executive County Superintendent; if the Commissioner does not issue a decision on the appeal within 15 days, the decision of the Executive County Superintendent stands. Consolidation: No later than three years from the passage of this law, the ECS recommends to the Commissioner a school district consolidation plan to eliminate all districts in the county, other than a county based district, and other than pre-school or Kindergarten-12 district in the county. After approval of the plan by the Commissioner, the ECS requires each board of education covered by this proposal to conduct a special school election on the plan. The proposal for regionalization of the school districts is considered adopted under 18A:13-5 (The vote is considered to be passed if a majority of “the total vote of the entire regional district, without regard to territorial boundaries of the constituent districts,” casts a ‘yes’ vote.). Shared Services: The local district may apply to the County officer to have school services, such as transportation, personnel, purchasing, payroll and accounting, assumed by the Office of the ECS. If the ECS assumes the service, a fee may be assessed. The ECS may utilize County Special Services, Jointures, and Education Services Commissions to provide services to local districts; the ECS may assess a fee to do so. Please go to www.gscschools.org for continued updating and GSCS-recommended member actions regarding Trenton’s developing legislation and impacts. At this time, GSCS is asking the Governor to conditionally veto 2 requirements in A1: 1) The supermajority of 60% of the voter turnout required to pass separate questions. 2) The stipulation that effectively caps the health benefits exemption at the level of growth in the State Health Benefits Plan. Approximately 60% of local school districts participate in private carrier health insurance plans because they have found it less costly do to so. By tying the health benefits exemption to the SHBP is may have the unintended consequence of drawing back districts to a more costly program overall. The marketplace should be the deciding factor for districts, not a legislative disincentive that could impede fiscally responsible choices. We urge members to call the Governor at 609 292 6000 to request he conditionally veto A1 as stated above. Thank you as always for your commitment and effort. Bill Highlights/Initial review: A1 Tax Levy Caps bill (Passed by both houses of the legislature, on the Governor’s desk) A ‘cap’ of 4% is statutorily imposed on the school property tax levy, beginning FY07-08. Given the 4% tax levy cap, the Office of Legislative Services has interpreted the legislative intent of the bill A1 to “set aside” the CIEFA cap of 2.5% or CPI whichever is greater. Other elements of S1701, such as 2% maximum on surplus (unrestricted reserve) and administrative cap remain in effect. Budget Vote: Required vote on the ‘Base Budget’ remains in place. FY 07-08 –Same process as last year, for both vote on the base budget overall and separate questions as well. FY 07-08, per CEIFA, there is no appeal of municipal determination should a separate proposal fail. Beginning with the FY 07-08 budget vote, separate proposals require a 60% supermajority of the votes cast. The Commissioner must provide ‘emergency’ regulations on the bill within 60 days of its enactment. Allows for more flexibility in reserve accounts in transferring funds into reserve accounts. Also a new account has been established under A1 that allows for the establishment of a current expense emergency reserve; A4 The CORE Plan Passed, with amendments (1. appeal of Executive County Superintendent {ECS} budgetary action/decision to Commissioner, and 2. moving the school board member elections back to April) by the Senate on 2-5-07; A4, as amended, must then be voted on in the Assembly in order for bill language to be identical; after the Assembly passage to bill will go to the Governor’s desk for final disposition. Separate proposal requirement In FY 08-09, in order for a district to propose a separate question, the ECS requires that districts either make demonstrated efforts to share services, or are currently sharing services, or can show that the current sharing of services has not saved the district money. Budget oversight: The ECS reviews all district budgets and may disapprove portions of the budget; further the ECS will then require that portion to be deducted prior to the budget’s publication. Appeal process: Appeal to Commissioner of Education permitted regarding ‘budgetary action’ by Executive County Superintendent; if the Commissioner does not issue a decision on the appeal within 15 days, the decision of the Executive County Superintendent stands. Consolidation: No later than three years from the passage of this law, the ECS recommends to the Commissioner a school district consolidation plan to eliminate all districts in the county, other than a county based district, and other than pre-school or Kindergarten-12 district in the county. After approval of the plan by the Commissioner, the ECS requires each board of education covered by this proposal to conduct a special school election on the plan. The proposal for regionalization of the school districts is considered adopted under 18A:13-5 (The vote is considered to be passed if a majority of “the total vote of the entire regional district, without regard to territorial boundaries of the constituent districts,” casts a ‘yes’ vote.). Shared Services: The local district may apply to the County officer to have school services, such as transportation, personnel, purchasing, payroll and accounting, assumed by the Office of the ECS. If the ECS assumes the service, a fee may be assessed. The ECS may utilize County Special Services, Jointures, and Education Services Commissions to provide services to local districts; the ECS may assess a fee to do so.