Most of the Abbotts are Now Underaided

When Steve Fulop of Jersey City spoke in February 2017 against any redistribution of state aid the worst lie he told was:







Wealth should determine state aid, not race, but even if race is your criterion, most of the districts in New Jersey that will lose aid are rural and Jersey Shore districts, who are majority white.

Contrary to Fulop's idiocy, the biggest gainers of aid redistribution are heavily minority.  Bound Brook is underaided by $10,596 per student and is 83% black and Latino.  Freehold Boro is underaided by  $8,484 per student and is 83% black and Latino.  Manchester Regional is underaided by $7,563 per student and is 77% black and Latino, plus many of the students there classified as "white" are Middle Eastern immigrants.  Fairview is underaided by $8,204 per student and is 82% black and Latino.

Fulop's own aid-gaining neighbors, like Bayonne, North Bergen, Kearny, and East Newark are heavily Latino.

And what is Jersey City?  Its schools are only 67% black and Latino.

Perhaps Fulop conflated "Abbott" with "heavily minority," but not all of the Abbotts are heavily minority anyway.   Pemberton is an Abbott and was the second most overaided district in New Jersey for 2016-17, but is 56% white.  Phillipsburg, another overaided Abbott from 2016-17, is 59% white.

Hoboken is technically 44% Latino, but the Latinos of Hoboken are almost never from Spanish-speaking homes and are not as poor as the Latinos of towns like Dover, Red Bank Boro, Belleville etc etc etc.  Many of Union City's Latinos are Cuban who look "white" to me.

Anyway, in 2016-17 only half of the Abbotts were overaided at all, but for 2017-18 only 14 out of 31 are.

Of the fourteen overaided Abbotts three are overaided by less than $1,000 per student (Millville, Burlington City, Salem City).  Hoboken is overaided by $7.5 million, or $2,895 per student (part of which is Interdistrict Choice), but Hoboken's Local Fair Share is $205 million and it can easily make up for the lost state aid.

Vineland is overaided by $10.3 million, or $1,024 per student, but it has $38 million in untapped Local Fair Share too.


The other seventeen Abbott

How Overaided Districts Would GAIN Money if SFRA is Not Changed

Recently Senator Jennifer Beck has been disseminating misleading, incomplete

Jennifer Beck is Confused About What
She Wants

information about state aid in order to slow the redistribution of Adjustment Aid.

Part of her campaign in defense of Adjustment Aid is pointing out that 157 districts that now get Adjustment Aid should not lose state aid because SFRA says they actually should get MORE state money than what they get now!

She has now twice said something to this effect.

Example 1:

It’s not clear, that redistributing Adjustment Aid is going to be as uncomplicated as some have suggested .... 157 of those districts are also underfunded relative to what SFRA says they should get in state aid,” the senator added.

Example 2:

Sen. Jennifer Beck, a Republican member of the committee, cautioned against unintended consequences with the removal of adjustment aid. She said 157 of 181 districts receiving the aid remain underfunded by the state, and abruptly taking away funding would hurt those communities. The place to start, she said, would be to redistribute the roughly $11 million from 46 districts that are overfunded by the state.

Yes, how can a district getting Adjustment Aid "remain underfunded"?

When Beck refers to Adjustment Aid districts getting _less_ than SFRA says they "should get," she is indeed statutorily correct, but she is conflating what Adjustment Aid says a district should get legally with what it actually needs.

Verification of Beck's legal claim be easily seen in the Alternative Aid Scenarios that the Department of Education produces to show how much aid districts would get if SFRA were followed, with Adjustment Aid and the State Aid Growth Limits preserved. A quick glance at even Asbury Park will reveal that is is getting $2,056175 less than SFRA says it should get (!!!!)

Giving Asbury Park more money? How can SFRA do this?

This is a consequence of the fact that SFRA does not let any district receive less than 102% of what it got in 2007-08 and the fact that in 2010 and 2013 Adjustment Aid was cut.

Due to this the Adjustment Aid 102% promise, SFRA is blind to what a district's contemporary economic needs are; unless it has a large post-2008 enrollment loss, it can never receive less than 102% of its 2007-08 funding.

The first violation of the 102% promise was in 2010, when Chris Christie cut every district's aid by an amount equivalent to 5% of its budget. These cuts affected underaided districts and overaided districts alike, but the overaided districts lost some of their Adjustment Aid while the underaided districts lost Equalization Aid, Special Education Aid etc. (Christie's cuts were later reversed for the Abbotts.)

The second violation of the 102% guarantee was in 2013 when Christie, as part of a now-obscure fair-minded phase, actually did cut $40 million in Adjustment Aid from Adjustment Aid districts who were over Adequacy.

The 2010 cuts:
EG

• Brick lost $2.3 million.
• Marlboro lost $1.8 million.

The 2013 cuts were allowed to occur for all affected districts, including Abbotts.
EG

• In 2012-13 Asbury Park lost $2.4 million. 
• Keansburg lost $1.4 million. 
• Pemberton lost $2.5 million. 

Any budget that passes the legislature is automatically legal, but these cuts were contrary to SFRA's stipulation that no district receive less than 102% of what it got in 2007-08.

Even though these districts are all overaided according to what SFRA's core formulas say they should receive, SFRA still contains the 102% provision and thereby it has a zombie-like determination to reverse the cuts of 2010 and 2013.

For instance, Asbury Park's aid is $25 million higher than its SFRA target (ie, Uncapped Aid), but according to SFRA, Asbury Park is owed another $2 million.

• This is because Asbury Park's peak aid was $57.7 million in 2008-09 and the Adjustment Aid mechanism of SFRA wants to bounce it back up to that amount.
• Pemberton's aid is also $25 million higher than its SFRA target, but SFRA wants to give it another $1 million. 
• Keansburg is overaided by $7 million against its real real need, but is underaided by $500,000 against Capped Aid. 
• Brick is overaided by $23 million, but would get another $2.2 million under SFRA. 
• Marlboro is overaided by $5.3 million, but would gain another $800,000. 

Most NJ districts are slightly underfunded against Capped Aid and significantly underfunded against Uncapped Aid, but for 157 Adjustment Aid districts, they are underfunded against Capped Aid, but overfunded against Uncapped Aid.

If SFRA were followed as it is currently written, 157 of New Jersey's overaided districts would actually gain a total of $84 million!! Asbury Park's gain would actually be larger than Red Bank Boro's in per student terms. Toms River would gain $3.4 million, even though it is already overaided by $21 million.

Particularly ridiculous is that Allenhurst, who has $5.1 million in Local Fair Share for only three students, gain another $10,612 in state aid.

There are another 46 districts who are now slightly underaided, but whose aid in 2008-09 was greater than what SFRA calculates they actually need.  Since the 102% promise in Adjustment Aid applies to these districts as well, their Capped Aid is higher than their Uncapped Aid.  For Passaic, Capped Aid is $20 million higher than Uncapped Aid; for Perth Amboy it's $11.6 million.  For Montclair, the Morris School District, and Princeton, Capped Aid is about $1 million each higher than Uncapped Aid.

If these 46 districts got their Capped Aid they would become overaided by $43 million.

Projected Gains Per StudentUnder the Adjustment Aid/State Aid Growth

Limit Status Quo of SFRA

See: http://bit.ly/2pGkPTq and http://www.nj.gov/education/stateaid/1718/scenarios.shtml

If Asbury Park and Pemberton are brought back to their peak aid levels, as Adjustment Aid dictates, the amount of aid available for truly underaided districts, including Red Bank Boro and Freehold Boro in Jennifer Beck's own district, is reduced by $84 million.  If the 46 slightly underaided districts are brought back to their peak aid levels the amount of money to give to districts like Red Bank Boro and Freehold Boro is reduced by $43 million.

Jennifer Beck is UNDERMINING the cause of fairness by making any references to the 102% promise within SFRA.

We cannot cut Adjustment Aid and keep the 102% guarantee. Since Beck purports to be an ally of Freehold and Red Bank Boros, Beck's self-contradiction here is off-the-charts.

The solution to perverse consequences of SFRA that would pour more money into overaided districts is to eliminate Adjustment Aid.

Beck, who in the past I liked, doesn't know what she wants, other than that she likes to get photo opportunities with Freehold and Red Bank Boros.

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See Also

• The Skews of Capped Aid
• The Long Wait for Full Funding Under Capped Aid

Loss Of Adjustment Aid Only Rarely Would Be Damaging

One line of argument against redistributing Adjustment Aid is that the loss of Adjustment Aid would be very hurtful to aid-losing districts.

For Sen. Jennifer Beck of Monmouth, an off-and-on reformer, issued this cautionary note after the May 2017 Senate Budget hearing:

Sen. Jennifer Beck, a Republican member of the [Budget] committee, cautioned against unintended consequences with the removal of Adjustment Aid. She said 157 of 181 districts receiving the Aid remain underfunded by the state [sic, this is a profoundly wrong statement], and abruptly taking away funding would hurt those communities. ....

“The Legislature needs to address the school funding disparity in this budget cycle, but we also must be cautious when considering the complexities of redistributing Adjustment Aid,” Beck, who is in a tough re-election battle, said in a statement after the hearing. “One thing that is certain is that our most underfunded districts cannot wait any longer for relief.”

Although there are some districts for whom the loss of Adjustment Aid would be very painful, on the whole, most districts getting Adjustment Aid either

1. have Adjustment Aid as a small percentage of their budget.
2. have Adjustment Aid as a small percentage of their Local Fair Share.
3. are very high-spending as it is.

As we will see in greater detail below, there are only a handful of districts for whom the loss of Adjustment Aid would result in large budgetary impact who would not make up the lost revenue with local taxes.

(For this study I have attempted to be as accurate as possible and therefore subtracted aid excess that is the result of Interdistrict Choice money.  While the total amount of excess aid distributed for 2017-18 will be $696 million, $27 million of that amount is actually from Interdistrict Choice and therefore not subject to redistribution based on any proposal currently under discussion.  The 2017-18 Uncapped Aid figures are here.)

For the median district that is overaided, Adjustment Aid represents 10.2% of Local Fair Share.

There are 61 districts Adjustment Aid is not even 5% of the Local Fair Share.  Since the Adjustment Aid would be eliminated over five years, it's difficult to imagine why the loss of it should be difficult.

For another 38 districts for whom Adjustment Aid equals 5-10% of Local Fair Share.  For these districts there could be some difficulty adapting to reduced aid, but not enormous difficulty.

Hoboken (5% of budget but 2.4% of LFS, ), Upper Freehold (7.7% of LFS), Middleton (14% of budget but 3.8% of LFS), Weehawken (5% of budget but 3.1% of LFS), Hillsborough (6% of budget, 7.7% of LFS), and the Jersey Shore overfunded districts are among the districts who should not have a major problem adapting.

Then, admittedly, there are 105 districts for whom Adjustment Aid exceeds 10% of Local Fair Share, including 52 for whom it exceeds 20%. Asbury Park's $25.3 million of Adjustment Aid equals 184% of its Local Fair Share (39% of the budget), although Asbury Park is the outlier here.

Some readers may consider tax increases, even over five years, equal to 20% of Local Fair Share to be too onerous for voters to accept and therefore oppose cuts in Adjustment Aid because the reductions would force programming cuts.

It's true, if a district gets a large amount of Adjustment Aid, then losing that money would force cuts, but the complicating fact here is that these districts tend to already be very high-spending.  For them to lose significant money in Adjustment Aid would require cuts, but the cuts would be coming off of a level of spending that average and severely underfunded districts in New Jersey are nowhere near.

Let's look closely at the Budgetary Cost Per Pupil for the 52 districts for whom Adjustment Aid exceeds 20% of Local Fair Share.  (excluding non-operating districts)

My mistake. Brooklawn should NOT be on the list because its excess aid comes from Interdistrict Choice.
This strengthens my case.

These spending figures are almost always substantially above New Jersey's average.  The districts whose spending is the lowest Ocean Township (Ocean County) are districts who voluntarily keep their taxes very low.  Ocean Township's taxes are 66% of Local Fair Share.

Let's look at a few large, overfunded districts up-close:

• Pemberton, a rural Abbott in the heart of the Pinelands, is overfunded by $25 million, for just 4300 students.
  
  Because of that excess, Pemberton now spends $20,000 per pupil, even though it only taxes at 57% of its Local Fair Share ($12 million against $21.5 million).
  
  Pemberton's excess aid is $25.7 million, which is far greater an amount than it could possibly make up with its own taxes, but as Pemberton loses its Adjustment Aid, it would be simply falling to the state's average and still be vastly better off than the dozens of high-FRL NJ districts now who now spend as little as $10,000 per student.  As an Abbott, Pemberton would retain 100% state funding for construction projects and two years of "free" state-funded PreK.

• Brick is overfunded by $23 million for 8750 students.  Brick taxes at 77% of Local Fair Share, or $101 million compared to $131 million.   If it got a waiver and decided to make up for 100% of the lost aid through local taxes, Brick would still be under its Local Fair Share by $7 million.  

Lest I be accused of not acknowledging the impact of budget cuts on aid-losing districts, what also has to be considered is that even if Steve Sweeney's plan to redistribute all of Adjustment Aid and add another $500 million in school spending is implemented, it is not enough to bring every all of today's underaided districts up to 100%, because that would require $2.1 billion, not the $1.1 billion Sweeney is talking about.  So, even after the process of eliminating Adjustment Aid is complete, these aid-losing districts will be at 100% funding while there are many others that remain at 70%, 80% etc.

(See, Is Steve Sweeney Overselling His State Aid Proposal?)

So even if Sweeney's plan is implemented faithfully, there will still be a distribution of haves and have-nots.  Pemberton, Brick, Asbury Park etc will be at 100% funding, while Delran, Clifton,Cherry Hill, Chesterfield, Freehold Boro etc are still below 100% funding.

And most of New Jersey's poorest districts get no Adjustment Aid at all:

2014-15 Data

2014-15 Data

Central Avenue, East Orange.

At the risk of weakening my own case for redistribution, THERE ARE some overfunded districts for whom losing Adjustment Aid would be very difficult.  The district I would be the most worried about is East Orange.

East Orange is overfunded by $25 million, which is equivalent to 12% of East Orange's Total Operating Budget.  East Orange's school taxes are $20.7 million below Local Fair Share, so even if East Orange wanted to tax at its full Local Fair Share, cuts would still occur.

However, there is no way that East Orange could pay its full Local Fair Share because East Orange's municipal taxes are off-the-charts, at 3.5%, as part of an all-in tax rate of 4.6%.  Most New Jersey towns have municipal taxes at about a quarter of all-in taxes, but in East Orange municipal taxes  make up 72% of East Orange's total taxes.

I assume there is bloat in East Orange's municipal government, but much of that extreme tax burden is likely due to unavoidable need.

However, East Orange is an exception, and any painful cuts that other overaided districts will have to make as they lose Adjustment Aid has to be counterassessed against the deep existing budgetary deprivation existing in hundreds of underaided districts and the fact that even if Sweeney's plan is implemented, today's underaided districts will still not be at 100% funding.

For most districts that face losses of Adjustment Aid, the losses are manageable as long as there is some fix to the tax cap passed.

And when New Jersey's fiscal future is so grim, the elimination of Adjustment Aid is necessary.

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See Also

• Adjustment Aid, Who Gets It and Who Doesn't
• Adjustment Aid and DFG B, Who Gets It and Who Doesn't

Adjustment Aid Has No Statutory Sunset

One claim I often see regarding Adjustment Aid is that Adjustment Aid was intended to be temporary:

For instance, journalists make this claim, eg, the New Jersey Spotlight:

Adjustment Aid, sometimes called “hold harmless aid,” was created by the 2008 School Funding Reform Act (SFRA) to make sure districts would not see big drops in their state aid when the new formula went into effect. It was calculated based on their aid packages in 2007-2008, and was supposed to gradually phase out as districts adapted to their lower aid allotment.

And so do politicians, eg, Steve Sweeney:

The original formula was altered to include provisions that have prevented districts with increased student enrollment from receiving fair compensation at the same time other school systems are overcompensated with money for students they don’t have. These add-ons – “growth caps” and “Adjustment Aid” – were intended to be temporary but continue to be funded eight years later.

Ok, the above is not correct.  SFRA only allows the most marginal decreases in Adjustment Aid, and only for districts that lose enrollment after 2008.  There are no decreases allowed for districts whose wealth increases but whose student enrollment is stable.  

The only section of SFRA that contains any references to reducing Adjustment Aid is this excerpted section:

For the 2011-2012 school year and for each subsequent school year, a district that has a decline in its weighted enrollment, adjusted for bilingual and at-risk pupils, between the 2008-2009 school year and the budget year that is not greater than 5% will receive Adjustment Aid in such amount as to ensure that the district receives the greater of the amount of State aid calculated under the bill or the amount of State aid that the district received in the 2008-2009 school year. In the case of a school district that has had such a decline in enrollment that is greater than 5%, the district will experience a reduction in Adjustment Aid in accordance with its percentage decline in resident enrollment that exceeds 5%.

What this means is that if a district loses 15% of its (weighted) enrollment post 2008-09, would lose Adjustment Aid equivalent to 10% of its 2008-08 per pupil Adjustment Aid.  (10% = 15% - 5%).

(In reality there is an additional complication because the amount of Adjustment Aid the district is entitled to could (theoretically) change due to changes in Local Fair Share, but the basic rule is as above.) 

The provision respecting the loss of Adjustment Aid is significantly flawed because it misses the following important scenarios under which a district's aid could become unfairly high:

• Districts were already overaided in 2008-09, hence the existence of Adjustment Aid in the first year of SFRA.  So, if a district had enrollment loss prior to 2008-09 and received Adjustment Aid in 2008-09, but thereafter its enrollment was stable, it does not lose Adjustment Aid, since SFRA's clock starts ticking only in 2008-09.

• If a district has an increase in wealth post 2008-09 and becomes overaided (or even more overaided) as a result of that, it likewise does not lose Adjustment Aid.

So, SFRA's mechanism for the reduction of Adjustment Aid only allows for marginal cuts. 

As SFRA is written, the only real reduction of Adjustment Aid would occur at a decades-long timescale, as inflation and state spending growth gradually push Adequacy Budgets and Categorical Aid spending upwards and Adjustment Aid erodes away under inflation and the increase in other streams of aid.

The inadequacy of the Adjustment Aid-loss provision in SFRA can be seen in the Department of Education's "2017-2018 Additional School Funding Scenario (Information Only)."

These funding scenarios give the amount of aid districts would get if SFRA were followed exactly as the legislature and Jon Corzine wrote SFRA back in 2008, meaning, with Adjustment Aid and the State Aid Growth Limits intact.  

Under these scenarios, there are only 41 districts in all of New Jersey who would lose any state aid and the grand total of their losses is $11.6 million.

Jersey City, which based on the core formulas of SFRA is overaided by $159.9 million, would only lose -$920,741 (0.6% of its Excess Aid). Hoboken would only lose $1.3 million, which is 17% of its Excess Aid, the highest percentage of any aid-losing district.

Asbury Park, which is overaided by $25 million ($11,000 per student) would actually gain $2 million, because the cuts to Adjustment Aid that Christie made in 2012-13 were technically against SFRA. Other districts who are actually substantially overaided based on their economic capacity-demographic needs, like Pemberton, Toms River, Brick, and Keansburg would gain as well.  

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See Also:

• How Overaided Districts Would GAIN Money if SFRA is Not Changed

State Aid Disparities Worsen for 2017-18

This post and the underlying data were accurate at the time of writing, but in June 2017 the legislature changed the state aid allotment.  This post reflects the new, updated aid distribution. 

The Department of Education has finally calculated Uncapped Aid figures.  I have gotten these data via an OPRA request and put everything online.

As expected, another year of Chris Christie's frozen state aid distribution means that New Jersey's state aid disparities have become even worse.

In 2016-17, the 212 overaided districts had a total surplus of $618 million and the 379 underaided districts had a total deficit of $1.93 billion.

But for 2017-18 things are even more unjust:

• There are 222 overaided districts with a cumulative surplus of $696,882,364.  ($27 million of this excess is from Interdistrict Choice)
• There are 369 districts with a cumulative deficit of $2.072 billion.* 

I do not know the Extraordinary Aid deficit, but it is at least $100 million.

Additional Material:

• The median NJ district gets $4,031 per student in K-12 state aid.
• The median NJ district is underaided by $460 per student (compared to uncapped aid.)
• The median NJ district gets 82% of its Uncapped Aid. 
• There are 72 districts that get 200% or more of their Uncapped Aid.
• Of the 222 overaided districts, 89 are overaided by $2,000 or more per student.
• The total excess aid of the overaided districts is $696.9 million.
• Of the 369 underaided districts, there are 127 districts that get 49.9% or less of their uncapped aid.
• Of the 369 underaided districts, there are 113 that have aid deficits greater than $2,000 per student and 58 with deficits greater than $4,000 per student.
• The total deficit for the underaided districts is $2.072 billion.

And to provide extreme examples:

• Asbury Park is the most overaided in per student terms, with an excess of $11,278 per student. SFRA's target for Asbury Park is $13,401 per student, but Asbury Park's actual aid is $25,595 per student.

• Deal is the most overaided in percentage terms, getting 1086% of what SFRA recommends. This is due to Interdistrict Choice money, although Deal is a small recipient of Adjustment Aid.
• Bound Brook is the most underaided in per student terms, with a deficit of $10,592 per student. (It gets $8.2 million when it should get $26 million for 1,724 students.)
• Chesterfield is the most underaided in percentage terms, getting only 9.5% of what it is supposed to. It gets $419,983 when it should get $4.22 million.
• Jersey City has the most untapped Local Fair Share. Jersey City's Local Fair Share is now $370 million, but its actual tax levy is $114 million. 

The Skews of Capped Aid

Other than the Orwellingly named aid-hoarding mechanism known as "Hold Harmless Aid," the most unfair aspect of New Jersey's School Funding Reform Act is the State Aid Growth Limits, aka "Enrollment Caps."

Due to these limits on how much money a district can gain, the most aid a district can gain is a 10% or 20% of what it got the year previous, no matter how severely underaided it is. 

(Technical Note: due to the cuts of 2010 and how low-aid districts then lost large percentages of their state aid, there are districts who would gain more than 20% from what they get now, however, that is technically due to the mechanism of Adjustment Aid, which overrides the State Aid Growth Limits for districts getting less state aid now than they did when SFRA was passed. Since this is a benign effect of Adjustment Aid, and Adjustment Aid is usually odious aid-hoarding, I prefer not to get into the weeds about it.)

Due to the existence of the Aid Caps and the fact that the Caps are percentage based, the more aid a district already receives, the more aid a district gains in dollars-per-student, which is the real measure of budgetary-tax impact.

(I got Capped Aid and Uncapped Aid amounts via an OPRA request to the DOE.  I've made the data publicly available here)

For instance, the following underaided districts all would be gaining the same amount in percentage terms if SFRA were operating:

But in the all-important dollars-per-student, the amounts the districts are getting are completely different and skewed.

What is unfair about this is that Chesterfield, Bound Brook, Manchester Regional Freehold Boro are New Jersey's most underaided districts against Uncapped Aid (Uncapped Aid = real SFRA full funding).  In percentage terms, Chesterfield does worse than any other district.  For 2017-18, Chesterfield will only get 9.5% of its Uncapped Aid, with Bound Brook (-$10,592), Manchester Regional (-$7,562 pp) and, Freehold Boro (-$8,484 pp) among the worst in dollars per student.

Newark, Paterson, Trenton, and Elizabeth are indeed badly underaided, but not by nearly as much.  Newark's aid deficit is only $3,059 pp, Paterson's is $3,252, Trenton's is $3,003, and Elizabeth's is $3,198.

As a consequence of the percentage-based mechanism of the Aid Caps, new aid under SFRA goes disproportionately to large, moderately underaided districts.

Fortunately, reforming the State Aid Growth Limits (aka Enrollment Caps) is part of Steve Sweeney's state aid proposal.  Unfortunately, no one in the media and few among other politicians understands what the State Aid Growth Limits even are.

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See Also:

• The Long Wait for Full Funding Under Capped Aid
• SFRA Was Never Fully Funded

Estimating Local Fair Share for 2017-18

Update: Local Fair Share, Capped Aid, and Uncapped Aid are now available. 

The following is moot.

After the Department of Education came out with 2017-18 state aid proposals I made an OPRA request of the Department of Education for 2017-18 Uncapped Aid and Local Fair Share.

I wanted Uncapped Aid so I could see what the total deficit is for the underaided districts, see what districts are the most underaided, see the total surplus for the overaided districts, and see what districts are the most overaided.

I wanted Local Fair Share so I could see whose taxes are the heaviest, whose taxes are the lightest, and what the median district in New Jersey pays.

I did not request Adequacy Budgets because spending relative to Adequacy is also determined by local tax effort and a focus on whose spending is above and below Adequacy can distract from state aid fairness.  Also, Adequacy Budgets are embedded into the calculation of Uncapped Aid anyway.

To my disappointment, the Department of Education said it did not calculate Local Fair Share and Uncapped Aid for 2017-18.  They did not give a reason, but my conjecture is that it was Christie who made the final decision not to bother with even the hypothetical operation of SFRA.

Nevertheless, the Department of Education did send me the components of Local Fair Share, which are Equalized Valuation (from the previous fiscal year, so 2016) and Aggregate Income (from three  years previous, so 2014).

The formula for Local Fair Share changes year to year, but by plugging in Equalized Valuation and Aggregate Income figures into the 2016-17 formula, I can ESTIMATE 2017-18 Local Fair Share and compare district tax bases.

This is the (first) formula for Local Fair Share used in 2016-17:

(Equalized Valuation x 0.013156218 + Aggregate Income x 0.046185507)/2

To see more about changes in Equalized Valuation between FY2016 and FY2017, please see this post of mine.

As usual, I've put the data online here.  2016-17 data, to which I make comparisons, is available here.

Yet again, these amounts are ESTIMATES - especially the year to year comparisons - since I have no idea what the multipliers should be in the 2017-18.

On the other hand, the relational comparisons between different towns should be very solid, since I am applying the same multipliers to every district for 2017-18.  If these calculations show that Hoboken's Local Fair Share is New Jersey's third highest at $195 million, I'd be surprised if the DOE's calculations give any different ranking, even if the exact Local Fair Share turns out to be something other than $195 million.

Hopefully the legislature will pressure Department of Education to simply run the formula so that the public may have a more informed conversation about state aid.

Anyway here goes:

• Jersey City's Local Fair Share would increase by another $20 million to $353 million.  This is powered by a $4 billion increase in the Equalized Valuation  (to $25.7 bil) and a $502 million increase in the Aggregate Income (to $8 bil).
  
  Jersey City's Local Fair Share appears to be now 76% larger than the next largest district's, which is Edison at $200 million.  For 2016-17 Jersey City's Local Fair Share was "only" 60% larger than Edison's.

• Hoboken's gained $1.8 billion in Equalized Valuation and $357 million in Aggregate Income.  Whatever the exact  Local Fair Share formula ends up being, Hoboken's Local Fair Share would likely be around  $195 million and be the third largest in New Jersey, after Jersey City and slightly behind Edison.  This year Hoboken's Local Fair Share surpasses Toms River's.
  
  Hoboken's 2016-17 tax levy was only $42 million, so for 2017-18 Hoboken's taxes will be barely a fifth of Local Fair Share
  
  For the last year pro-reformers in the legislature have pushed to eliminate Adjustment Aid, but there are certain low-student population districts such as Hoboken, some wealthy enclaves like Alpine and Harding, and many Jersey Shore resort towns who have no need for any state aid whatsoever.  

• There is also increases in other Hudson County towns, powered by non-Hoboken/non-Jersey City Hudson County's $5 billion increase in Equalized Valuation.  West New York's would be $4 million larger, driven by 10% increases in Equalized Valuation and Aggregate Income.
  
  Union City, Bayonne, North Bergen, Harrison, Kearny, and others would have small increases (the small increases might be smoothed away if the DOE actually ran the formula)

• Asbury Park's Local Fair Share would actually shrank (by a tiny amount). That's outrageous, since Asbury Park is undergoing a building boom. Asbury Park is just as much an example of the exploitation of the PILOT law as Jersey City is.  

• Atlantic City's Local Fair Share fell by another $13 million, from $65 million to $52 million.  This is due to the loss of another $2 billion in Equalized Valuation and $8 million in Aggregate Income.
  
  Atlantic City's school tax levy for 2016-17 was $82 million, so Atlatic City's taxes may be 157% of Local Fair Share.


• Manchester Regional's taxes are likely the state's highest again.  My estimate is that Manchester Regional's Local Fair Share is only $4.9 million, so the $10.9 million (which falls disproportionately on Prospect Park and Haledon due to Manchester Regional's unique tax-apportionment scheme) is absolutely brutal.
 

• Newark's Local Fair Share may have grown slightly, by $6 million, from $161 million to $167 million. (Newark's actual tax levy is $123 million)

• Paterson's Local Fair Share may have grown slightly too, by $3 million, from $85 million to $88 million (Paterson's actual tax levy is only $41.5 million)

Again, the above figures are only ESTIMATES, but I hope this post generates discussion, particularly regarding Hoboken and Jersey City's state aid and the acute tax crisis in Atlantic City.

Please ask your legislators to demand that the Department of Education do these calculations for real.

At the very least, we have to know  what the total deficit is for the underaided districts.  For 2016-17 it was $1.93 billion, which is far beyond any realistic tax increase.  This deficit number is a critical point in the argument for why redistribution is necessary.

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See Also:

• Help for the Needless: New Jersey's Richest Districts and their State Aid
• Beyond the Point of Fairness: The Most Overtaxed Districts in New Jersey
• The Robbers and the Robbed: State Aid Disparities for 2016-17