Legislators in New Jersey Look For National Perspective in School Funding Discussions

Addressing New Jersey's Joint Legislative Committee on School Funding Reform, meeting in special session on August 22, Molly A. Hunter, Managing Director of the National Access Network, and Michael Griffith, a consultant to the National Conference of State Legislatures, provided national perspectives on the numerous school funding litigations occurring across the country and the various ways states design their school funding systems.

After briefly exploring the litigations' historical roots in the American values of freedom, democracy and opportunity, Hunter described the issues typically addressed at trial and in the remedial phase of the "adequacy" cases. Griffith explained the various types of school funding formulas in use across the country, including the "foundation" approach augmented by "categorical" funding, on which 35 state funding systems are built. Griffith also analyzed New Jersey's funding system in comparison to states with similarities to New Jersey. Committee members asked numerous questions of both experts.

Special Session

Called into special session by Governor Jon Corzine, the legislature formed four joint committees to address budgetary issues: school funding reform; pensions; property tax reform; and "shared services" among municipalities and between school districts. The committees plan to meet from now through the early autumn and develop proposals by November 15, 2006. The School Funding Reform Committee decided to begin with background testimony and sought national perspectives on the most relevant issues before turning, later, to more specific and New Jersey-focused input.

Abbott v. Burke

Unlike the statewide remedies in other state school funding cases, the New Jersey Supreme Court, in the Abbott v. Burke case, ordered a remedy for the 31 lowest wealth districts only. The state developed remedial measures for those districts, now known as the Abbott districts, which comprise 23 percent of New Jersey's students. While students in the Abbott districts have excellent educational rights under the state constitutionally based court decisions – and many have made enormous test score gains – other low-wealth districts have complained that their students deserve similar funding and opportunities. Most of the state's school districts have been flat funded (i.e. no increase in state funding) for the last five years, as the state has experienced revenue shortfalls and now faces structural deficits.

Comparisons to Other States

When asked at what states the legislature should look for ideas, both Hunter and Griffith included Maryland on their list of state funding systems worthy of review and pointed to California's convoluted system as something other states should not consider. When asked about "high tax rates," Griffith explained that while New Jersey has high property taxes, its overall tax burden is only slightly above the national average.

Legislators also learned from both experts that most states, like New Jersey under its current system, provide much more funding to low-wealth districts and only small percentages of the funding for wealthy districts. Unlike New Jersey, however, most states have much more graduated funding from the state to districts of varying wealth.

In other questions, legislators suggested spending caps for wealthy districts, in order to keep school funding more manageable. Griffith noted that other states, including Maryland, Montana, New Mexico, and Michigan, have imposed such caps.

As the legislature is in the early stages of a major endeavor, it remains to be seen what proposals will emerge from the committees and what, ultimately, becomes law.

Prepared August 30, 2006