by Aiden DeMarsey, NJPI Jr. Education Fellow
Rarely do political issues, at any level of government, take such form as the controversial New Jersey school funding formula. Because of the implications this topic has not only for the resources guaranteed to our educators but also for the general economic viability of operating a fair and efficient education system, no issue in state politics carries greater weight and significance than identifying the best way to fund our schools.
In recent years, discourse around school funding has focused on the consequences of legislation amending the School Funding Reform Act (SFRA) from 2018. Commonly referred to as S2, these changes eliminated the adjustment funding mechanism in the formula, which had guaranteed that districts would not lose funding relative to the original SFRA implementation enacted in 2008. With these amendments, approximately 1/3 of New Jersey’s 590 operating school districts were left to manage a cumulative $600 million decrease in funding.
In my time as a school board member from Evesham Towsnhip, I came to understand these cuts and the wideranging impacts they brought to communities like my hometown. As a result of state-aid cuts, headlines focusing on the issue featured local budget cuts that often fueled public outrage. From staffing layoffs to permanent school closures, measures enacted by Trenton officials left residents questioning regional tax increases despite a forced decrease in school services.
While I as a board member saw this first hand in my own town, we were hardly an outlier story. It wasn’t until Middletown Township residents discovered plans to close three elementary schools, in an effort to balance their budget, that they truly understood the gravity of the district’s financial situation. While a $3.5 million decrease in annual state funding forced the Middletown BOE’s hand, they are not the only case of school closures. Since the implementation of S2, local residents from across the Garden State have become all too familiar with the stresses that districts face in managing state-aid cuts. Furthermore, through attending local meetings and analyzing the issue, many have come to understand the relationship between Trenton politics and the economic viability of our communities and public schools.
In recent years, the state has proven unwilling to amend the SFRA and reverse funding cuts. This is the case despite advocacy efforts from a unique coalition of local educator unions, school district officials, and concerned residents. The one option Trenton did provide was a temporary one-year suspension of the 2% property tax increase limit imposed on municipal and county authorities. This enabled school districts to answer state-aid cuts and rising expenses with property tax increases. In some cases, such rate hikes reached over $1,000 on the average household. Despite New Jersey already having the highest property taxes in the nation, districts left with the choice between budget cuts and rate hikes consistently chose the latter.
With taxes at an all-time high and what seem to be significant budget challenges just around the corner, many districts are soon to be looking for answers again. Dramatic premium increases for districts that are members of the New Jersey Educators Health Plan will only make it more challenging to fund the salaries and benefits that comprise the vast majority of annual school budgets. Furthermore, the state budget appears to be in similar fiscal trouble. With limited examples of a healthy financial situation for the New Jersey education system, significant questions remain.
In accordance with state law, municipalities and school districts must produce a balanced budget annually. In the foreseeable event that the state is financially unable to subsidize local schools facing dramatic increases in expenditures, districts must either raise taxes or cut services. Given the history of school funding in New Jersey, both options are unreliable and unsustainable for long-term stability.
Any effort by the state of New Jersey to address this problem must go outside the box and completely revamp how we approach the administration and funding of public education. With the current state of affairs, we have long passed the point of minor tweaks and adjustments to the existing formula needed to achieve the balance districts are seeking. Perhaps the time has arrived for a total revamp, enacting a new education finance system closely aligned with models in peer states.
