Cuts To Urban Schools Could Top $1 Billion In Three Years

GOVERNOR'S FORMULA WILL WIPE OUT STAFF, PROGRAMS ADDED UNDER ABBOTT

Cuts to urban schools could top $1 billion in three years if Governor Jon Corzine's school funding formula is adopted, an ELC analysis shows. The bleak future facing urban students and schools was presented by ELC at a December 27th legislative hearing on the Governor's proposal.

The impact will be felt in the coming school year in most of the poorer urban, or "Abbott" districts, but will hit every urban district in the following two years. It is also likely that the cuts will continue for as long as the formula remains in effect.

The cuts will be so substantial that the teachers, staff, programs and services added under the 1997 under Abbott v. Burke rulings will be quickly wiped away.

The NJ Supreme Court required these resources to help address the extraordinary needs of urban students and schools resulting from intense poverty, racial isolation and decades of neglect.

Under the Governor's proposal, most Abbott districts will receive only a 2% increase in state aid in FY09, with no increase or "flat" funding during the following two years. After the third year, Abbott districts will no longer even be flat funded, but will begin losing state aid.

Based on preliminary FY09 data and prior years experience, the actual cost of non-discretionary increases in Abbott districts range conservatively from 4% to 6%. The biggest factor is contract-mandated teacher salaries, which typically increase from 4 to 4.5%. Other annual "cost-drivers" include heath benefits, energy, and tuition and charter school payments. Abbott districts also are prohibited from having any excess surplus, and face additional costs of opening and maintaining new school facilities.

Next year (FY09), 26 of the 31 Abbott districts will make cuts, and the total cuts could range from $30 million to $109 million. Jersey City, Newark, Trenton, Camden, Vineland are among the districts facing the steepest declines in the first year. ELC estimated these cuts based on a 4% or 6% annual increase in non-discretionary costs.

By the third year (FY11), the cumulative total cuts could range from $594 million to $1.1 billion, or almost 20% of the total Abbott district budgets. The cuts in Newark schools could reach $218 million, with $129 million in Jersey City, $68 million in Trenton, $86 million in Camden, $55 million in East Orange and $42 million in Vineland.

The underlying cause of these reductions is the so-called "adequacy" budgets used in the Governor's formula. These budgets are based on education costs developed over five years ago by the Department of Education using hypothetical school models. Although the NJDOE has adjusted these costs and budgets for inflation and price factors, they were not based on any study of the actual educational needs of urban students and schools, and they ignored the base or regular education costs in New Jersey's successful suburban districts.

Prepared by ELC : December 28, 2007