Schools

Education Commissioner Defends Hefty Cut in State Aid to Cranford, Other Districts

The school district's state aid cuts were much steeper than expected.

State Education Commissioner Bret Schundler on Wednesday defended the governor's significant cut to New Jersey school districts' state aid, telling reporters that previous Democratic administrations and the loss of $1 billion in federal stimulus funds are partly to blame for the reduction.

Cranford will lose nearly $2.5 million in state aid, but could also receive $4.2 million in other aid. Gov. Chris Christie presented his budget address Tuesday afternoon, indicating that school districts would not lose more than 5 percent of their total budget.

In a conference call with reporters, Schundler said that districts had been told to anticipate this reduction in aid.

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"Districts had the understanding that it would be 15 percent and it is a number that is less than that," Schundler said.   

But the Cranford School District and others were operating under the impression that the 15 percent cut would be out of the aid they receive, not out of their total operating budgets. 

Find out what's happening in Cranfordwith free, real-time updates from Patch.

Up until now, the district had been preparing its budget with the expectation that it would lose 1o to 15 percent of its expected state aid. Now that $2.5 million has been cut, the district will have to refigure many of its plans. Instead on Wednesday, the school district learned that it would actually lose 5 percent of its total operating budget of nearly $52 million. That slashed state formula aid by $2.5 million, dropping the amount they'll receive to just $751,837. The money goes toward general education expenses. This figure excludes about $4.2 million in specialized state aid used for debt service, Social Security payroll taxes, etc.

Schundler pointed to the loss of federal stimulus money as one reason state aid was cut so much. The education commissioner noted that funds from last year's stimulus package were used to partially pay for state aid payments at that time. The federal aid was meant as a one-time payment to states.

On Wednesday, Schundler said that the state legislature can avert layoffs at the school district level by implementing Christie's package of public employee reforms in a quick time frame. The package includes changing the pension and health benefits packages for teachers, including requiring co-pays and larger payments for pensions. The co-pays will apply to school personnel who retire after the changes are made, but not to those who leave their jobs before the proposals are enacted.

Schundler said this will allow for more quick retirements from teachers who do not want to pay part of their health insurance in retirement. He said quick enactment, which is not considered likely, will help stem the expected layoffs in school districts statewide.

"That will dramactically reduce the number of personnel reductions that would be achieved through a layoff," he said. "These reforms will reduce costs to the districts and create a need for early retirements."

The Cranford district will have the option to raise property taxes above the four percent state cap in order to make up for the lost school aid, but Schundler said the county superintendents will be looking to hold property tax hikes under the four percent cap and are prepared to veto spending over this amount.

Schundler said he believes that school districts can accomplish the cuts by the March 30 deadline for school budgets to be submitted for voter approval. He said he has instructed county superintendents to throughly review each school district budget and be prepared to make line item vetos in order to make further reductions before the budgets go to the voters on April 20. State law allows county superintendents to make these vetos.

The Cranford Board of Education will hold a special meeting on March 22 at Lincoln School to approve the 2010-2011 preliminary budget for submission to the Executive County Superintendent of Schools. A public hearing will be held on the budget at Walnut Avenue School on March 29. Both meetings will start at 7 p.m.


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