Board of Ed Approves Resolution Addressing Net Loss in State Aid

To the Editor:

The Westfield Board of Education unanimously approved a resolution opposing the Schools Development Authority assessments in the State Budget that will be sent to the Governor and our legislators.   

According to the nonpartisan Office of Legislative Services, in its annual analysis of the Governor's proposed budget, almost half of New Jersey school districts will see a net loss in State Aid due to the construction grant fees or Schools Development Authority assessments.  Westfield is one of these districts. 

As you will all remember, Westfield’s State Aid was increased by one dollar for the coming year. A one dollar increase is not a meaningful increase in terms of student achievement. And, at the same time, $75,230 will be deducted from our State Aid for a Schools Development Authority assessment. After accounting for Westfield’s increased assessment, our district will experience a decrease in State Aid for Fiscal 2014 of $75,229.

I would like to clarify exactly what Schools Development Authority assessments are for the public. They are fees that cover a portion of the principal and interest on bonds used to fund construction grants that were floated by the New Jersey Economic Development Authority, later called, the Schools Development Authority. The upfront grants covered up to 40 percent of eligible construction costs in non-Abbott districts. They were designed to reduce the amount of money districts needed to borrow for facility projects and, in the process, reduce the reliance on local property taxes for needed construction and renovation of our facilities. When we received these grants it was with the understanding that they were grants, not loans to be paid back at a future time.

The relationship between State taxes, State Aid for school districts and local property taxes must be underscored. It is important to remember that the taxpayers of Westfield pay more than $74 million in State taxes and will get back this year approximately $2.8 million in State Aid for our schools. State Aid accounts for a mere 3% of our budget. The Westfield public schools are almost entirely paid for by Westfield property taxes. $2.8 million is a drop in the bucket of our $88.9 million dollar budget. And, we have still not been made whole from the $4.2 million cut that the Governor made to our State Aid in his first year of office. We still have $1.4 million less than we did when the Governor took office. 

The Budget hearings are now ongoing in Trenton. The Senate Budget Committee met yesterday and part of the discussion was about the Schools Development Authority assessments. According to the New Jersey School Boards Association, “Everyone is in agreement that it is a top priority to get these assessments lowered.” That is why it is important that our legislators hear our concerns now before they vote on the budget in the coming weeks.  

(To view the resolution, see the attached pdf document at the right.)

Ann Ormsby Cary

Chair, Legislation Committee

Westfield Board of Education