Two-thirds of New Jersey school systems are expected to see a state aid bump for 2026-27, though the positive outlook is tempered by districts’ rising costs and budget constraints.
School aid under Gov. Mikie Sherrill’s budget is a record high of $12.4 billion. About 400 of the state’s 600 school districts would see more money than this year, according to projected figures released by the governor’s office on Thursday.
For the most part, those increases are subject to a 6% cap, a guardrail placed by Sherrill’s predecessor, Phil Murphy, as a way to create more stability in districts’ year-to-year planning. Decreases, too, are limited, to 3%.
“I look forward to continued conversations with stakeholders from across the state as we work to modernize and stabilize the school funding formula,” Education Commissioner Lily Laux said in a statement.
No more to cut
New Jersey towns pay for their schools mostly with property tax revenue. That’s not enough, though, for many districts to provide what the state constitution calls a “thorough and efficient education.” As a result, the state steps in with more taxpayer money for operating expenses. The school aid pitched by Sherrill represents roughly one-fifth of her proposed $60.7 billion spending plan for the fiscal year that starts July 1.
While Sherrill is proposing record school aid, the caps present challenges to districts that say they’ve been underfunded for years and can’t close budget holes even with 6% increases. Many districts subject to decreases say they have no place left to economize.
In another step to reduce budgeting volatility, the proposed aid bases special education funding on enrollment and uses a three-year average for property wealth and income measures. Those gauges are temporary one-year remedies as state leaders promise to update the school funding formula to meet district needs and rising costs for special education, health insurance and transportation.
“The budget includes a record level of K-12 school funding, while acknowledging that much more work is needed to make sure students and taxpayers get the best return on our investment,” Sherrill said in a statement.
Pluses and minuses
In terms of dollar amounts, some of the state’s largest school districts would log the biggest increases. Newark would see a $60.6 million boost; Paterson, $37.1 million more; and Trenton, $24 million more.
Roughly 167 districts would get less than the current share. The steepest dollar declines would hit West New York, with $4.2 million less; Jersey City, $3.9 million less; and Bridgeton, $3.3 million less.
Sherrill in her budget presentation on Tuesday said taxpayers aren’t getting “the bang for the buck that we need,” especially as an increasing number of districts are cutting staffs and programs in the face of rising operating costs and debt.
Jefferson Township public schools, in Morris County, have pressed for more state aid amid a projected $4.8 million deficit. Though no decisions have been made yet, the district is considering program cuts for hte next school year.
Local officials say the the district has lost nearly $45 million since the 2017-18 school year after the state began adjusting the way it fulfilled its school funding formula obligations, shifting funds from so-called overfunded districts to those that were historically underfunded.
For the fiscal year that begins July 1, Jefferson schools would receive $5.4 million in aid, after a 6% increase.
Superintendent Jeanne Howe said she was disappointed that the boost amounted to just $308,438. The district had expected $1.2 million, she said.
“The fight is not over,” Howe told NJ Spotlight News on Thursday. “This continues to create significant challenges as we work to balance our budget.”
— Charts by Colleen O’Dea
