NJSBA officials praised Governor Corzine for his pledge not to sacrifice the quality of education as the state attempts to control property taxes. The comments, from NJSBA Executive Director Edwina M. Lee, came in response to the governor’s first State of the State message on Tuesday.

Lee, however, cautioned that a 4-percent annual cap on local property taxes could have a negative impact on education quality. The concept also sends property tax reform in the wrong direction.

“A new, adequate school funding system—and not rigid, hard caps—will be the keystone to any type of property tax reform,” she said. “We agree with the governor that a new school finance system should be among the state’s highest priorities.”

Proposed 4 Percent Cap “The root cause of New Jersey’s property tax problem is not unbridled local spending. Instead, it is chronic under-funding of state aid to education,” Lee continued. “Since 2002, state aid to local school districts has generally been stagnant. At the same time, costs that are out of school districts’ control have increased. It’s been the local property taxpayer who has to make up the difference.

“In New Jersey, the state government only covers 38 percent of the cost of public education, while the average state pays 50 percent,” said Lee, pointing to statistics from the National Education Association.

“New Jersey’s school boards already operate with spending caps. By law, school budgets are capped at the rate of inflation or 2.5 percent, whichever is higher, and adjustments are made for enrollment increases and costs not under school districts’ control. The vast majority of school districts stay within that requirement.

 “NJSBA supports reasonable budget caps,” Lee said. “However, rigidly designed ‘hard’ caps can’t work unless all other costs remain at the same level. Just last winter, the nation was struck by massive spikes in fuel and utilities, and schools were not spared. Hard caps only work in a vacuum, but not in the real world.

“We do not want legislators’ push for property tax relief to undermine the quality of public schools,” Lee continued.

“Gov. Corzine’s address touted the strength of New Jersey’s public schools. Just last week, Education Week magazine rated New Jersey’s K-12 academic achievement the second best in the nation. We don’t want to see New Jersey schools fall behind.”

Shared Services and Consolidation “We wholeheartedly support the concept of state incentives for shared services, which are a cost-efficient method to yield tax savings,” said Lee.

“NJSBA supports consolidation of school districts when it’s decided by local voters and after feasibility studies have proven benefits to the communities involved,” she explained.

“The governor touched on all the right concepts when it came to shared services and consolidation. It was encouraging to hear the governor call for shared services and consolidation to remain a voluntary option.”