On Saturday, Dec. 5, the NJSBA Legislative Committee met and hosted Mark Magyar, associate executive director of the Senate Majority Office, as guest speaker. The bulk of Magyar’s comments addressed district regionalization, school employee health benefits reform and school funding.
“We appreciate the frank and informative discussion that Mark Magyar had with our members,” said NJSBA Executive Director Dr. Lawrence S. Feinsod. “We respect his willingness to listen and exchange ideas on key issues.”
Regionalization Magyar was quick to address regionalization, informing the committee that legislation will be coming soon. He emphasized that any program will be voluntary. (NJSBA believes that school district regionalization must be approved by the communities involved after a thorough study of the educational and financial impact.) Magyar also said that legislators are keen to address the issue, particularly for what he described as smaller districts that cannot provide robust education due to their small enrollment numbers. There is the thought as well, though to a lesser extent, that regionalization can result in cost savings. According to Magyar, school districts in Salem County spend, on average, 22% more per pupil than the single district of Vineland, which has a comparable student population. Salem County is studying the formation of a single, countywide district. The study is due by the end of February.
The legislation could include incentives such as the state paying for feasibility studies and a more stretched-out schedule for those districts losing state aid because of S-2, the 2018 law that put the state on a path toward full funding of its school finance formula, but also reallocated aid among districts. Additionally, language will be included emphasizing that regionalization cannot result in increased racial segregation. Magyar invited school board members to submit ideas about other barriers to regionalization that could be addressed through legislation. He can be reached via email at mmagyar@njleg.org.
NJSBA’s 2018 report, Impediments to School District Regionalization, identifies statutory and regulatory obstacles to locally initiated regionalization efforts and ways to remove the barriers.
Re-Examination of Health Plans Magyar noted Senate President Steve Sweeney is aware of issues and concerns that are arising from the new Chapter 44 health plan law, and noted the law promised savings for school districts. That law was intended to save districts, taxpayers and school employees hundreds of millions of dollars. However, not all districts expect to realize such savings. Magyar indicated that they are collecting data and examining ways to address concerns that some districts are suffering adverse financial impacts under the new law.
School Funding The need for more transparency in the calculation of state aid was also raised. This could be addressed by a committee or task force charged with reviewing the state aid process at regular intervals. The idea was first suggested by Senator Sweeney at the Nov. 2019 Delegate Assembly.
Magyar also warned of a potential “fiscal cliff” that could arise in a few years if federal COVID relief is no longer available, but the New Jersey economy has not fully recovered to pre-pandemic levels. In anticipation of such a situation, the state may run higher-than-usual budget surpluses. Absent this problem, the state should reach full funding of pension obligations in fiscal year 2023, which will then allow for a more concerted effort to fully fund the school aid formula.