Monday, August 10, 2015

Actual Aid Versus Uncapped Aid: A Tale of Gross Unfairness

If you want quick proof of how irrational and unfair New Jersey's aid distribution is all you should have to do is do a quick check of what percentage of a district's uncapped aid it actually receives.

Except you can't.  The DOE doesn't publicly release what a district's uncapped aid level is.  The numbers aren't confidential and were publicly released during the Corzine Administration but the Christie Administration prefers to ignore SFRA as much as possible.  The Christie Administration does give each district's uncapped aid figure to each district, but there is no public release of the numbers. 

Nonetheless the Education Law Center (whose data is great, even if I disagree with some of their priorities) does have the data and I'm posting it here for you.

The average NJ district only gets 85% of its uncapped aid, but there are 220 districts that get 100% or more of their uncapped aid.  There 117 districts that get 50% or less of their uncapped aid.

The most overaided district in percentage terms is  Cape May Point, which has $475 million in property valuation for only three students and yet gets $26,803 in state aid. Of larger districts Ocean Township in Cape May County is the most overaided.  Ocean Township has $5.4 million in property wealth per student and yet gets $6.9 million for its 2,101 students, coming out to 562% of what Ocean Township is supposed to get.

In absolute terms Jersey City is the most overaided, getting $111.7 million of excess aid.  Pemberton is in distant second place, with $27 million in excess aid.

The most underaided district in percentage terms is Chesterfield Township in Burlington County which only get 11% of its uncapped aid.

Chesterfield Township is likely so underaided because has experienced huge population growth, growing from 348 students in 2006-2007 to 563 students in 2010-11 to 728 in 2014-15, a 109% increase in under a decade.  Despite that enormous population growth, Chesterfield's state aid has only increased from about $310,992 to about $403,000.  Chesterfield, which is only a K-6 district, also has a $500,000 tax base per student, since it has to share a tax base with Northern Burlington Regional.  Chesterfield's $500,000 tax base means its Local Fair Share is very low, thereby pushing its Equalization Aid higher.

Chesterfield anticipates that population will exceed 800 students in the next two years meaning that Chesterfield will become even more underaided unless Christie and the legislature start to pay attention to districts whose budget needs are the most acute.

In absolute terms the most underaided district is Newark, which should receive $131.7 million more than it receives.  In percentage terms Newark gets 84% of its aid, which is at the state's average.

Paterson, Elizabeth, Union City, New Brunswick, and Plainfield are other Abbott districts in the bottom ten of gaps in absolute dollars.  This could set the premise of another Abbott lawsuit.

The Education Law Center has released these data but in the form of aid gaps per student, not in percentage terms or absolute dollars.

The most underaided district in dollars per student appears to be Manchester Regional, whose $10.2 million deficit for 958 students works out to a deficit that is over $10,700 per student.  Bound Brook has the second highest deficit per student, at  $9,100 per student.

The most overaided district per student is Asbury Park, which gets $9,995 more per student than it should.

For clarification about the tables I link to:

1. "Column D." "K-12 State Aid (the district's actual aid)"

This is how much aid districts are getting in reality. These figures are the same figures that appear publicly in the State Aid Summaries. They include all streams of operating aid. The total cost is $7,957,828,723. This does not include Pre-K or Extraordinary Aid.

2. "Column E." SFRA "Full" Funding (Includes Transporation, Security, Sped, Equalization, Choice, Adjustment Aid, PARCC Readiness, SEGA etc etc)
This is what districts would get if SFRA were "fully funded" with caps in place but preserving Adjustment Aid and off-formula aids like PARCC Readiness Aid, Per Pupil Growth Aid, and "Additional Adjustment Aid," Supplemental Enrollment Growth Aid (SEGA), and Under Adequacy Aid were folded into Additional Adjustment Aid. The total cost would be $8,986,791,801.

However, the "full funding" figures include caps and is thus a misnomer.  Under capped funding many districts would still not get what they are legally entitled to. If you calculate what West Orange would get ($1,355) per student to what a wealthy exurb like Marlboro would get ($2,489) per student the aid amounts are still irrational.  Guttenberg would get $5,858, Lakewood would get $4,797, Dover would get $8,343; all much much less than the Abbott districts that they are demographic peers of.

The figures for "Fully funded SFRA" appear in the DOE's "Alternative Aid Scenarios."

3. "Column F."

SFRA Uncapped Aid (Transportation, Security, Sped, and Equalization)

This is how much aid districts should get from the four most rational and fair streams of aid, Equalization Aid, Transportation Aid, Security Aid, and Special Education Aid absent aid caps.

In other words, this uncapped aid is the real "full funding" of SFRA. These figures would be much more rational and internally fair. Guttenberg, Lakewood, and Dover would all get about double what they are getting now and they would receive as much as their Abbotts peers.

If excess aid streams like Adjustment Aid etc were preserved uncapped aid would cost New Jersey another $2 billion.  If redistribution were allowed and every district simply got 100% of its aid it would cost NJ another $1.37 billion.

It is impossible for NJ to come up with enough money right now to provide full capped aid to all districts, let alone uncapped aid.  However, to bring up the 117 districts that get less than 50% of their uncapped aid would only cost $120-130 million.  (the 117 underaided districts are usually not that large)  This is something the state can do.  

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