The New Jersey School Boards Association on March 12 urged the Legislature to substantially increase funding for extraordinary special education expenses, which are required under state and federal law.

In testimony on Gov. Murphy’s proposed 2020-2021 state budget, NJSBA also advocated “strong, decisive action” to control the cost of public employee health benefits. The Association provided its perspective to the Senate Budget & Appropriations Committee during a hearing at Rowan University.

“In November 2019, NJSBA issued a statement in support of strategies that would benefit all school districts in areas such as special education, health benefits reform, facilities and payment in lieu of taxes, or PILOT, agreements,” said Dr. Lawrence S. Feinsod, NJSBA executive director, when discussing the testimony.

NJSBA’s prepared statement cited support for the proposed $336 million increase in state education aid, which would be distributed to approximately two-thirds of the state’s school districts. The Association termed the allocation “a critical part of the effort to adjust state aid allocations for enrollment growth and changes in economic factors after more than a decade of flat funding.”

NJSBA also stated its support for the proposed $50 million fund to address exceptional circumstances in those districts that will experience state aid reductions as a result of the redistribution scheduled through 2024. In addition, the Association renewed its call for legislation to provide an optional adjustment to the 2% tax levy cap to certain districts that will be losing state aid.

Excerpts from NJSBA’s prepared testimony follow:

Special Education “The state had been on a trajectory of fully funding extraordinary special education. However, the proposed budget flat funds extraordinary special education at $250 million. We hope the Legislature is able to increase this amount as it did last year…”

Extraordinary special education costs are those above $40,000 per pupil and usually involve out-of-district placements required under state and federal law.

Health Benefits Reform “NJSBA believes that strong, decisive action to control the cost of public employee health benefits must be reflected in the budget. We welcomed the inclusion of $174 million of health savings initiatives in the proposed budget. We were further buoyed by the recently announced agreement between the Senate President and the NJEA that…could lead to savings of $650 million for local school districts and the state.”

NJSBA noted that the School Employees Health Benefits Program has failed to adopt the type of cost-effective strategies that have controlled the cost of the state-run health plan for non-education employees. Successful strategies include limiting reimbursement for out-of-network chiropractic and acupuncture; limiting reimbursement for out-of-network physical therapy; and prescription drug management.

“These changes would help local boards of education direct limited resources into educational programming and services, while maintaining a level of benefits necessary to recruit high-quality staff.”

State Aid “NJSBA appreciates the addition of $336 million in formula aid, which will benefit the majority of the state’s school districts. This is a critical part of the effort to adjust state aid allocations for enrollment growth and changes in economic factors after more than a decade of flat funding. These funding increases must be untouched.”

“NJSBA was pleased to hear the Governor’s proposal to set aside $50 million to help stabilize the finances of the districts facing long-term reductions in state aid.. We believe that this funding could help to address exceptional circumstances in these school districts. It is our understanding this aid is intended to be allocated through a grant process; and we look forward to engaging the Governor’s Office, the Department of Education and legislators as the criteria for this grant process is developed.”

Cap Adjustment “NJSBA was disappointed at the end of last session when legislation was vetoed that would have allowed some of the districts losing state aid to exceed the 2% tax levy cap, if needed.”

Legislation to establish the cap adjustment, S-1938, was reintroduced on February 25 by Senate President Steve Sweeney.

NJSBA was represented at the hearing by Christopher Jones of its Governmental Relations Department.

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