ELC News - School Funding Committee Recommends Using Outdated, Flawed Cost Study

A Legislative Committee working on school funding is recommending the Legislature base a new funding formula on results from an flawed and outdated study of education costs performed by the NJ Department of Education almost four years ago.

But the Committee also reports it will abandon an attempt by DOE to determine education costs based on the spending levels of high performing school districts in New Jersey, even though this method was adopted by the NJ Supreme Court to determine adequate school funding in the landmark Abbott v. Burke equity case.

The recommendations are outlined in a November 15th report

issued by the Joint Legislative Committee on School Funding Reform.

Specifically, the Committee is proposing that a new school funding formula be based upon cost determinations made by DOE in 2003, with advice from Denver-based consultant John Augenblick. The DOE has asserted it used a costing out method known as "professional judgment," a process in which groups of highly skilled educators, business administrators, and other experts are convened to identify, carefully consider, and make final judgments and determinations about the resources needed to provide a high quality educational program.

Although much of the DOE 2003 costing-out work still remains secret, testimony by Commissioner Lucille Davy and other documents obtained by ELC show that the DOE did not follow well-established procedures used in the professional judgment studies in Maryland, New York and other states, such as allowing the outside professionals to make all critical decisions about what staff, programs and services are needed, and then sharing the cost calculations with those professionals. Nor did DOE ever prepare or disseminate a final report of the professionals’ input and cost judgments, or solicit public input on the study results.

In addition, the DOE never conducted critical research to ensure any new formula meets constitutional requirements for school funding adequacy, This includes comparing base or foundational education costs with spending in the 128 suburban District Factor Group "I&J" districts, which currently comprise NJ’s successful school districts under the Abbott rulings, and costing out preschool, early literacy and other supplemental programs and reforms for poor students identified in Abbott.

The Committee’s decision to abandon the successful school cost method is especially troubling in light of Commissioner Davy’s October 24th testimony that the DOE had decided that a "base" or "foundation" education cost of $8500 per pupil on average would be adequate to educate New Jersey’s public school students statewide. The proposed base cost is 17% below current foundation spending levels statewide, and 22% lower than what the constitutionally adequate I&J suburban districts spend. It also means that districts are spending over $2 billion more than DOE believes is necessary to meet the State academic standards, with suburban districts accounting for over $700 million in "excess" spending.

The DOE has offered no evidence to show how districts can achieve State academic standards at a cost significantly lower than what they now spend, nor has DOE produced any proof that the I&J suburban districts are wasting hundreds of millions on unnecessary programs.

"We’re disappointed that the Committee is sticking with education cost results from a study we know was seriously flawed and never completed," said David Sciarra, ELC Executive Director. "Even worse, the 2003 study is now outdated and no longer relevant. In fact, use of this study would contradict another one of the Committee’s recommendations, namely, that education costs are ‘dynamic’ and should be revised every two years."

ELC is calling on the Legislature to reject the Committee’s recommendation, and authorize a renewed effort to develop credible and up-to-date educational costs, verified against actual spending in NJ’s "lighthouse" suburban schools. This can be done quickly by hiring an independent school finance expert to convene new professional panels. Those panels can develop new education inputs and costs, using the work done by DOE in 2003 as a starting point. The expert, along with the panels, can then seek stakeholder and public input, and provide a full report to the public as a basis for legislative action on a new formula.