Opinion ID: 2294246
Heading Depth: 1
Heading Rank: 27

Heading: 2/3 Cost for Special Education

Text: The RCE recommended wealth-equalization of the excess costs associated with special education. D-1 ¶ 36. The DOE decided to wealth equalize two-thirds of those special education costs. Ibid. That is, two-thirds of special education costs are accounted for in the Adequacy Budget. The remaining one-third is provided to districts as a categorical aid. Ibid. Special education funding is determined using a census-based methodology to calculate the resources needed for all special education students statewide. D-1 ¶ 34. Under the census model, aid is allocated based on the average classification rate in the State (14.69%) and the average costs of educating special education students above the base per pupil amount ($10,898). D-1 ¶ 35; see also Loeb, 9 T 31:16-32:10; see also Pittman, 8 T 16:6-24. To derive the average costs above the base per pupil amount, the State took the total amount of special education funding and divided by the total number of special education students. Pittman, 8 T 17:4-16. Loeb testified for the State concerning the census-based methodology. Loeb found the State's method of funding special education to be appropriate, as low cost special education tends to be distributed somewhat evenly throughout districts. Loeb, 9 T 34:25-37:6. In addition, Loeb opined the method can be beneficial, as it prevents over-classification of special education students, which can be a problem in funding formulas where districts receive additional funds for each classified child. Loeb, 9 T 32:11-34:2. In addressing the higher classification rates under other formulas, Loeb offered [a] plausible explanation of this result is that, because districts will receive more funding if more students are classified, districts have an incentive to over-classify. D-122 ¶ 62. Loeb did, however, acknowledge some of the over classification may have resulted from a greater understanding of the need for classification over time. Loeb, 9 T 66:8-16. On the last day of testimony, Ms. Barbara Gantwerk (Gantwerk), DOE Assistant Commissioner of the Division of Student Services, testified about the negative effects of misclassification. Gantwerk, 29 T 6:24-7:4, 11:13-12:22. In particular, Gantwerk found overclassification can result in stigma and slowed progress for a student. Ibid. In determining costs under the census-based method, the State used actual expenditures for special education (as compared to the PJP model), in part, because a study found New Jersey had significantly above-average expenditures in this area. D-1 ¶ 34; see also D-78 at AB00729; see also Davy, 1 T 89:23-91:25. In fact, this State has a higher special education classification rate than any other state in the country12.54%; the national classification average is 8.96%. Gantwerk, 28 T 20:17-21:16; D-159. By way of comparison, the census-based model under SFRA uses a classification rate of 14.69%. N.J.S.A. 18A:7F-51(e). Special education funding (excluding speech-only) is determined by multiplying a district's total enrollment by the state average classification rate and by the average special education cost. To determine the amount of funding provided under the adequacy budget, this total is multiplied by two-thirds. N.J.S.A. 18A:7F-51(e). SE Census = Resident Enroll × State Avg. Classification Rate × Excess Cost × 2/3 = 24,624 × 14.69% × $10,897.75 × 2/3 = $26,280,050.60 [23]