Thursday, October 19, 2017

New NJ school funding database shows increased fairness in FY18

New Jersey's July 2017 budget agreement regarding state aid to schools provided a small but important step toward increased fairness in school funding. The change in equity status for each school district is laid out in the just-released FY18 NJ School Funding Database.

The three major variables affecting school funding are the essence of the database: state aid, local taxes, and budget adequacy.  The Funding Fairness Index (FFI) combines the three into a single metric to simplify analysis.  A negative FFI score means the district is in an unfavorable position from an equity funding perspective, while a positive score indicates the opposite.  Greater equity is occurring when FFI scores move toward zero.  

A column in the new database labeled Direction contains a scale score from 0-2 to identify the equity gain or loss between FY17 and FY18. The scale works as follows:
  • 0 = moving further from zero
  • 1 = no change
  • 2 = moving closer to zero
The state median scale score is 1.05.  Since 1.00 would indicate no change, this demonstrates a small improvement in equity for school districts as a whole from the combined perspective of state aid, local taxes, and budget adequacy.  Recall that 73% of the state's school districts and 33 of the 40 legislative districts received additional state aid in FY18.  So, this is good news but we have a long way to go before basic funding equity is achieved. 

This year's database also includes several spreadsheets sorted by a new variable called Type, which distinguishes districts that have very different characteristics. They are grouped into four types: 
  • The 25 Non-Operating and Merged districts, which do not function by definition;
  • The 21 Vocational-Technical districts, which have a different mission than other districts;
  • The 502 Standard districts, which make up the majority of the state.
A look at the subtotals for state aid, local taxes, and budget adequacy confirm that these four types of school districts do have significant differences from one another from a fiscal perspective.

You can access the database below and see how your school district is doing in terms of funding fairness for the 2017-18 school year.

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