As budget tensions grow in Trenton, the state Senate is moving forward with legislation to rework the state’s school funding formula that has left some local districts underfunded by millions of dollars since it was enacted in 2008.
On Tuesday, the Senate Budget and Appropriations Committee approved legislation sponsored by Senate President Steve Sweeney eliminating “growth caps” and establishing a seven-year phase-out of “adjustment aid.”
Sweeney, D-Gloucester, announced the new funding plan last month, stating it would restore fairness to the formula. The changes would remove the limits on funding increases for districts that see large increase in enrollment and would remove the adjustment aid that was created to hold districts harmless if they lost enrollment.
“State aid is supposed to be distributed based on each district’s property-tax wealth, its ability to pay, enrollment changes and the special needs of its schoolchildren. Lifting the growth cap and phasing out adjustment aid ensures that state aid ‘follows the child’ as the SFRA intended,” Sweeney said.
Underfunded towns such as Atlantic City and Egg Harbor Township stand to benefit from the proposed changes, according to data. However many of the districts in Cape May County would lose aid if the bill passes, the data suggest.
Amendments to the bill would help several local districts facing adjustment aid cuts even though they are spending below adequacy.
One of the changes would protect students in districts such as Pleasantville, Millville and Vineland, which are spending below adequacy, but where the total school, municipal and county property tax burden constitutes “municipal overburden.”
Another change would eliminate adjustment aid cuts in non-Abbott districts that are spending below 90 percent of adequacy and have a municipal property tax overburden at least 10 percent higher than the state average, specifically Fairfield and Lawrence townships in Cumberland County.
An identical bill was introduced in the Assembly, sponsored by Speaker Craig Coughlin, D-Middlesex.
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