NJPSA TESTIMONY ON SCHOOL FUNDING CONCEPT PAPER

BEFORE A JOINT HEARING OF THE

SENATE EDUCATION AND BUDGET/APPROPRIATIONS COMMITTEES

December 13, 2007

Thank you for the opportunity to share the views if the NJ Principals and Supervisors Association on the complex question of a new school funding formula for New Jersey’s schools. NJPSA represents 6500 school principals, assistant principals and supervisory staff who lead our schools at the building level and who have a great stake in the development of a new method of funding our schools.

Our members advocate for students in all school districts in New Jerseys, whether urban, suburban or rural; or low, middle or high income. Our members’ priority is to provide a top quality education to all our students. We have much to be proud of- New Jersey’s schools consistently rank among the best in the nation.

However, it becomes increasingly difficult to lead our schools when school funding issues divide local communities. In recent years, New Jersey has exacerbated this problem by flat funding our schools, thereby continuing a funding system that is viewed as unfair and inadequate. As we work for the passage of a new formula, our goal is to create a system that may finally unite our citizens in support of our schools. For this reason, we share the goals of the Governor and every Legislator in this room, to provide a fair, fully funded and equitable formula that meets the needs of all children regardless of residence.

These stakes are too high to rush into a new system without a thorough review of the consequences. We need the citizens of New Jersey to view the new system as fair, or else these divisive issues will only continue.

Our association has participated throughout the legislative and administrative process to share our views, including testimony before the Joint Legislative Committee on Public School Funding Reform, testimony on the December 2006 NJDOE Cost of Education and attendance at the stakeholder meetings conducted by Education Commissioner Davy this past summer. These meetings dealt with concepts, not detailed formula changes.

On November 30th, we learned some of the details of the general framework of a new formula for the first time. Last night, we received some district impact data, but no actual bill language. While we appreciate the additional state aid that has been announced for all districts in the coming year, we are concerned about future funding to all school districts when the initial hold harmless provisions phase out. For this reason, it is critical that bill language be released for legislators and stakeholders to analyze the formula’s impact beyond the initial hold harmless years of the formula.

Due to the complexity of school funding, the lack of actual bill language, and the short time period remaining in the Lameduck Session, we ask that the Legislature slow down the process to permit a full analysis of the proposed formula before it is adopted. It is critical to get the formula right this time, rather than extend the contentious debate over school finance and rising property taxes into future years.

The Concept Paper-Initial Comments

Adequacy

The key question to be answered is whether the new per pupil spending amounts are in fact “adequate” to meet the needs of New Jersey school children who have a wide range of varying needs.

Much like the medical profession, it is critical that the State “do no harm” with its new formula. The Abbott districts must be able to continue essential programs and services to their students over the long-term, not just for the next two “hold harmless” years. Important gains have been made at the preschool and elementary levels in recent years in these districts and new secondary reform programs are now underway. The adequacy studies that form the basis for the new per pupil amounts did not consider the funding necessary to support these middle and high school level reforms.

While NJPSA does appreciate the positive changes that the NJDOE has apparently made in its cost assessment methodology since the December 2006 Report on the Cost of Education, we question why other expert recommendations were not incorporated. For example, Allan Odden noted in the “Final Report on the Reviews of the Report on the Cost of Education in New Jersey,” that professional development costs were underestimated by the NJDOE Report.

It may not be sufficient to simply “tweak” the adequacy amount in light of the widespread criticism of the NJDOE Report last year. At a minimum, district-specific data on actual spending last year should be compared to the formula’s impact in year 3 to assess the true adequacy of the proposed per pupil amount.

Security Needs

We do support the creation of a new form of categorical aid to meet the widespread concern for school security statewide. The concept paper addresses our concern over the underestimated costs for security at the high school level, particularly in districts with high concentrations of at risk students. We support this focus and new form of aid to all districts.

Early Childhood Education

NJPSA supports the Governor’s priority of expanding the option of high quality preschool to more children in need across the state, not only those children residing in the current Abbott districts. National educational research and New Jersey’s actual outcomes are clear: high quality preschool is a critical and effective tool in addressing the needs of children at risk and preparing them for educational success. We strongly support the goal of expanding preschool opportunities for children at risk and pledge to work collaboratively to develop and support these programs as the aid is phased in.

Principals do have several concerns with this proposal as it is envisioned however.

First, the proposal fails to adequately address current kindergarten needs across the state for our 5 year old student populations. Many willing and needy school districts are currently unable to provide full-day kindergarten opportunities for children in their communities. It is our understanding that about half of our current District Factor Group (DFG) CD districts offer full-day kindergarten. We believe that it is insufficient to mandate the establishment of preschool for 3 and 4 year olds where no full-day kindergarten exists to follow through on the preparation of these young students.

The proposed formula does address this issue in one very positive way. For the first time in New Jersey, full-day kindergarten programs will be fully funded, not “halfway funded” (0.5) as is currently the case. This is an important step forward and we thank the Governor and the Department of Education for rectifying this important flaw in our current funding system.

However, this single step is not enough. In order to be fully funded, full day kindergarten must be in fact offered. Many New Jersey school districts do not have the appropriate facilities’ spaces to house these programs. Kindergarten and early childhood programs have certain facilities’ requirements that must be met, including a bathroom in the classroom and a sink. Since the school construction program has stalled, districts that are willing to provide expanded preschool and full day kindergarten have been stymied in their efforts by an inability to provide the appropriate spaces. Others have faced difficulties in finding appropriately certified staff. In order to meet the goals of our expanded early childhood investments, we must assist all districts who wish to provide full-day kindergarten, with a priority to districts with high concentrations of at risk students.

We recommend that funding be available for start-up costs after an initial planning period and approval of the district’s early childhood plan. The start-up funds could cover such costs as necessary professional development, curriculum articulation and facilities’ modifications to assist districts in getting these programs in place. In addition, districts need flexibility in their planning and budgetary process to determine how and when to phase in their full-day kindergarten and preschool programs and in what order. As long as districts get their programs in place by the target date, districts should be able to decide which program makes sense to provide first. Districts should also be permitted to seek a Commissioner waiver to the tax levy cap to put these programs in place without negatively impacting other district programs.

An integrated preschool and full-day kindergarten program is clearly the right goal; any formula that is adopted must recognize that districts need the necessary flexibility and funds to achieve it.

Special Education

A major concern of our members is the announced approach to special education funding.

Federal and state mandates for special education programs have historically been woefully underfunded despite strict mandates. The burden to pay for these unequivocal student needs has repeatedly been shifted to local property taxpayers who currently pay more than half of these costs.

The resulting budgetary and programmatic tensions will only be increased by the proposed hybrid funding proposal. Not only is the new funding proposal based upon a reliance on the average statewide classification rate and average statewide special education cost, the aid will then be “wealth equalized”. As a result, many communities may see little or no actual dollars from the State to meet the needs of our most vulnerable students, but will still be required to provide all services. Local taxpayers will see no relief, only an additional burden from their approach.

In addition, this funding approach can only hurt the children and families who need our services the most. It will disproportionately impact the many dedicated school districts that have prioritized the needs of special education students through excellent programs and services. For these reasons, we urge this committee to reject this new approach to special education funding and maintain the current categorical funding approach to special education.

Conclusion

NJPSA does understand the need to finalize the long process of developing a new formula for New Jersey schools. All types of school districts have suffered since 2001-2, with six years of flat funding, no recognition of enrollment growth, inflationary cost increases and new program mandates. Our members have repeatedly and often unsuccessfully been forced to appeal to local property taxpayers to provide necessary operational funds due to the rising gaps in state aid to schools. For these reasons, we seek a prompt resolution of the funding question for our state.

Yet, key questions need to be considered and answers provided to you as legislators and to education stakeholders across the state before a formula in pushed through in the Lameduck session. Attached are some questions for your consideration as the legislative process continues. NJPSA urges you to seek out answers to these and other critical questions that arise before casting your vote on a new funding formula that will impact our children and our taxpayers for years to come.

Thank you.

Submitted by: Debra J. Bradley, Esq. - NJPSA Director of Government Relations

Unanswered Questions

  1. How will the new formula be funded with a recurring revenue source, beyond the two hold harmless years promised by the Governor?
  1. Will district –by –district impact data be provided to legislators and stakeholders that show the impact of the new formula after the first two years?
  1. In Year 2 of the formula, will districts be held harmless to the 2007-8 figures or will there be some form of escalator provision to address cost-of-living increases?
  1. Will district by district data be provided comparing the current year allocation of special education funding to the proposed special education funding under the new formula?
  1. What recommendations of national experts Allan Odden, Lawrence Picus and Joseph Olchefske were NOT adopted in establishing the new per pupil amounts and why?
  1. What changes if any, will be permitted in the school election process to appeal any program or staffing cuts that impact T and E?
  1. If a district is spending at below the adequacy levels set by the new formula, will the state increase their state aid to meet those levels?
  1. What aspects of the formula other than special education funding are to be wealth equalized?
  1. What aspects of the formula will be effective immediately upon passage and what provisions will be phased-in over time? Can the NJDOE provide a detailed schedule for review?
  1. What will be the Local Share component of the formula?