As Gov. Mikie Sherrill prepares to unveil her first state spending plan on Tuesday, she must grapple with the state’s projected $3 billion structural budget gap between forecasted revenues and planned expenditures.
Some of the greatest pressures on New Jersey’s budget relate to public education, like how the state funds its schools and how it covers the costs of public workers’ pensions and health benefits.
Liz Rosenberg, senior education reporter for NJ Advance Media, looked at some of the biggest education issues facing the Sherrill administration. This interview has been lightly edited.
Joanna Gagis, anchor: Let’s start with the school funding formula, or S2, that was first mandated by the courts and then implemented in its latest version through legislation. Can you explain how the state comes up with its per-district allocation?
Liz Rosenberg: It would take hours to really explain how it all works. But there are a lot of things that go into it: how many students a district has, how many of a particular type of student a district has.
In addition to taking into account what’s happening in the district, there’s something called the “adequacy budget.” The adequacy budget considers ratios of counselors to students, mental health supports. It considers all kinds of things: operations, transportation, special education costs. And so they basically spit out a formula that says how much they think the state needs to provide and how much the particular district needs to provide to give the students in that district an efficient and adequate education.
JG: Have there been solutions as a new administration comes in, in terms of how they might update that formula and kind of level out some of these districts that are below adequacy?
LR: One of the things that came up in Lily Laux’s confirmation hearing that many people are advocating for: She did indicate that it’s possible that she might change how special education is funded. Right now in the actual law, special education is funded based on the Census, and assume about 15% of every school district is special education students. However, that is not an accurate measure, so advocates take issue with that.
They also want it to return to a tiered system. So if you have a lot of students that are higher-needs in your district, you would get more money to actually meet them where they are in terms of what they need.
JG: Health care costs are a major contributing factor. We know the state health benefits plan is, I would say, on a steep fiscal decline. Is that fair to say, based on the reporting?
LR: Absolutely. As I understand it, if a district is using the state plan, it’s increased about 31%. And so a big part of what I’m hearing from everyone everywhere is that the funding formula needs to be updated and modernized, which is what Sherrill has said she’s going to do. And people are asking for her to do that in a bottom-up process. One of the interesting things that came out of my reporting was that repeatedly, people said, “Please listen to people on the ground as you make these big decisions.”
JG: We do know that many schools are more than 100 years old, so there’s aging infrastructure across the state. That’s a bill that’s likely to come due for more and more districts as these buildings start to fall into disrepair. The Schools Development Authority, I believe, had a $50 million allocation in the last budget. There is a bill right now that was proposed by Senate Majority Leader Teresa Ruiz (D-Essex). She’d like to see the state go out to bond. I know that happened in 2000 and 2008. Can you explain how that might help fund really critical maintenance projects for buildings?
LR: As I understand it, what she’s trying to do is build a consistent revenue stream.
Rather than kind of, case-by-case or year-by-year asking for funding, that there’s something stable that people can plan: “We have these upcoming infrastructure needs. Maybe we’re not the district that gets the money this year, but we are the district that’s going to get the money in the future.’”And knowing that there is that future and long-term planning, I think, is what she’s trying to do.
