Opinion ID: 1562623
Heading Depth: 1
Heading Rank: 3

Heading: Formula Development

Text: DOE decided to base its formula on one model district  the large district  out of the original six models. Its rationale for that decision was based on several considerations. It claims that larger districts generally are more efficient and that, therefore, the use of a larger model would provide incentive for the creation of larger, more efficient districts, consistent with the Legislature's preference for such efficiencies. In addition, DOE asserts that large and extra-large districts tend to have more at-risk students, and generally are more likely to reflect the characteristics of a greater number of districts. [5] DOE also weighted students based on grade level to reflect the higher cost of educating middle and high school students. DOE then applied certain categorical cost-enhancements to the model. Those included: adding $175 per student for capital improvements; adjusting utilities costs to reflect inflation; adding more resources for professional development; increasing funding for instructional aides for districts with at-risk populations of over forty percent; [6] providing for extra security guards in districts that are over forty percent at-risk; and expanding the definition of at-risk to include students eligible for both free and reduced-price lunches. DOE also adjusted the formula to use census or actual-cost data for categories such as salary benefits and vocational schools, and switched from a median to a mean value for the calculation of teachers' salaries. In addition, DOE carved out a third weight for students who qualify as both at-risk and LEP, and enhanced the LEP weight (from .47 to .50). According to DOE, that weight enhancement increases the fiscal resources allocated for LEP students by approximately $300 per student. Additional weights were added for districts with at-risk pupil percentages exceeding sixty percent, according to a sliding scale. Under the adjusted formula, districts with high percentages of at-risk students receive additional funds beyond those needed to support the resources identified through the PJP process. Finally, DOE expanded the provision of preschool programs and changed the method through which special education is funded. For example, every district is obligated to provide preschool to all three- and four-year-olds who qualify as atrisk, and any DFG A, B, or CD district [7] with a concentration of forty percent or more children must offer full-day preschool to all three- and four-year-olds in that district. That designation includes all Abbott districts except Hoboken, which is classified as DFG FG. Under DOE's proposal, the State will fully fund those per-pupil amounts based on actual enrollment and the funds will be segregated in a special revenue fund. One of the primary differences between the new formula and prior school funding formulas is that virtually all aid under the new formula is wealth-equalized. Each district contributes to its adequacy budget an amount that is based on its ability to raise local revenue. The adequacy budget includes: (1) the base amounts for elementary, middle, and high school students; (2) the additional weights for at-risk, LEP, and at-risk LEP students; (3) two-thirds of the census-based cost for general education; and (4) all census-based costs for speech. It therefore constitutes the vast majority of a district's education expenditures. Adding to that is a district's required local fair share contribution. That amount is calculated by indexing the district's property wealth and aggregate income using statewide multipliers. State equalization aid compensates for the difference between the fair share and the adequacy amount. Categorical aid is then allocated, regardless of a district's ability to raise revenue, to pay for: (1) one-third of the census-based cost for general special education; (2) security aid; (3) preschool aid; and (4) extraordinary aid for special education.