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STATEMENT ON ABBOTT IMPLEMENTATION
JOINT COMMITTEE ON THE PUBLIC SCHOOLS
October 2, 2003
 

I will discuss today the status three critical and timely issues involving Abbott implementation: (1) the 2003-04 maintenance budget; (2) the emergency regulations for 2004-05; and (3) whole school reform.

1.     2003-04 Maintenance Budget:

On July 23^rd, the Supreme Court granted the Administration’s request to cap Abbott district budgets for a second year, or to maintain the district’s budgets at the 2002-03 level with no opportunity to restore programs cut due to last year’s time out or to propose new, needed programs. The Court defined "maintenance" as the districts’ 2002-03 budget, as "approved" by the Department of Education (DOE). The Court also reaffirmed the State’s authority under Abbott to eliminate any spending deemed by DOE to be "inefficient."

As required by the Court order, DOE issued letters on August 27^th providing districts with a preliminary maintenance budget figure and an estimate of the Abbott supplemental funding (Additional Abbott v. Burke Aid) required for that budget. DOE also identified inefficiencies based upon the audits undertaken by the State Treasurer in August.

ELC has worked closely with the districts in their appeals. We have also reviewed the Administrative Law Judge decisions issued to date. Our key findings are as follows:

        A.     Inefficiencies:   As a result of the Treasurer’s audits, DOE alleged inefficient spending in only 9 of the 30 Abbott districts. 21 districts were, in effect, given a clean bill of fiscal health. In the 9 districts, the DOE claimed $27 million in inefficiencies, with $14.8 million in Newark. Districts are also successfully challenging DOE claims. In Asbury Park, only $500,000 of $1.8 million in DOE-identified inefficiencies were sustained by the Law Judge.

The results from this process will, hopefully, silence those who make unsubstantiated assertions that Abbott districts are somehow squandering their funds, or engaged in widespread wasteful spending. The Abbott districts are well managed, fiscally sound and efficient.

        B.     "Approved vs. Provided:  " By emergency regulation issued mid-August, DOE redefined "maintenance budget" to give itself the authority to reduce districts’ 2002-03 "approved" budget by expenditures not actually spent as of June 30^th. This has become known as the "approved vs. provided" issue. As a result of this DOE action, many districts faced substantial reductions in their budgets for this year, simply because they had vacant positions they could not fill last year; they slowed spending late last year because of the uncertainty over the final state aid payment; or because the expenditure was encumbered by June 30^th, but not yet paid. The bottom line: more contentious litigation with districts vowing to continue their challenge to the DOE’s cuts in court, if the Commissioner does not restore those cuts in his final decisions.

        C.     FYO4 Budget Shortfall:   When Commissioner Librera was before you on August 5^th, he admitted that there was not enough funds in the FY04 Budget to support the Abbott programs, even at a maintenance budget level, and that the "only question is" ‘How much.’ (Page 26). As a result of the Court ordered budget process, and the ALJ decisions, that shortfall is coming into focus. The final amount must, however, await the completion of the districts’ litigation against DOE.

ELC estimates that current amount of supplemental funding required to support the maintenance budgets at $317 million, but the estimate will likely rise as districts succeed in restoring DOE budget cuts through the appeals process.

ELC also estimates the FY04 Budget shortfall – as of today – at $142 million. The shortfall could rise as the litigation moves along. This funding is necessary to make up the shortfall in state aid for preschool, and to fund supplemental programs at the maintenance budget level. As the Commissioner has stated, we will need a supplemental appropriation to support the Abbott programs this year.

We also know that other school districts need extra help, especially as they too grapple with the requirements of No Child Left Behind. I would propose a bi-partisan effort, to begin today, to develop and enact a supplemental appropriation package containing both funds required by Abbott and targeted to non-Abbott districts and schools with urgent needs.

2.     2004-05 Emergency Regulations:

On September 9^th, the Commissioner adopted emergency regulations to govern Abbott programs, budgets and funds for the 2004-05 school year. The Supreme Court directed that these regulations, which expire on June 30, 2004, be the product of a "consensus" reached among a committee of key Abbott stakeholders, which included Senator Rice and Assemblyman Stanley.

The rulemaking committee is unified on one issue: that "consensus" was not reached on the Commissioner’s emergency regulations, and that DOE itself rewrote the final language of many key sections to conform to its view of what the Abbott decisions require and how they should be implemented.

Much good work was done by the rulemaking committee, and I am confident consensus can be reached if the effort can continue.

That effort must continue. The current "battle of the Abbott budgets" between DOE and the districts results primarily from the application of regulations written solely by DOE, with no input, let alone consensus. If the current emergency regulations are not revised, those battles will continue right into the next school year. Put bluntly, we must do what the Supreme Court has asked us to do – make "ever effort" to achieve buy-in by all key stakeholders – DOE, ELC, districts, parents and legislators on the regulatory framework essential for effective and timely implementation of the Abbott remedies.

We need – now – a firm commitment from the Commissioner to continue the efforts of the rulemaking committee to reach consensus on Abbott rules, and to then amend the emergency regulations to reflect that consensus.

3.     Whole School Reform

In its filing with the Supreme Court last March, the Administration sought to end Abbott whole school reform. Yet the achievement results from 1999-2002 in elementary schools engaged in whole school reform are nothing short of remarkable. For example, Abbott fourth graders scored 24 points higher in literacy than non-Abbott students; the achievement gap between Abbott and non-Abbott students in early literacy closed by 15 points; many fewer Abbott students were in the partial proficiency category; and Success for All schools, some of the our State’s poorest, produced extraordinary gains in early literacy and math.

Because of these gains, ELC opposed elimination of WSR. The evidence strongly suggests that having teachers working regularly with outside WSR experts is making a real difference in urban elementary schools. The good news is that mediation agreement between DOE and ELC, as set forth in the Court’s June 14^th order, continues WSR. Indeed, the mediation order improves upon the WSR framework by identifying low performing schools, and requiring those schools to undergo performance assessments by outside expert teams assembled by DOE.

The troubling news is that it appears many schools cut back on their WSR efforts last year, after receiving signals from DOE that "WSR would soon be over." It is also unclear how many schools are continuing on with their WSR models, and whether DOE is prepared to follow through on the rigorous performance assessment process mandated by the Court’s June 24^th mediation order.

ELC will be closely monitoring this process. We need you to join us in that effort. I strongly recommend that a future hearing of this committee be dedicated to a through examination of DOE’s implementation of WSR, as required under the mediation order.

Thank you for the opportunity to appear before you today.