A Brief History of

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A Brief History of Education Finance
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1620 1871 The Era of Local Control
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1648 The first property tax to finance schools

Dedham
1647 The Old Deluder Satan Act
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THE 1700s
Morrison a little republic at every crossroads
Cubberly Communities or neighborhoods which
wanted to could easily meet and organize a
school, levy a tax on their own property, employ
a teacher, and erect or rent a building.
Odden Picus Those who did not want schools or
were unwilling to pay could choose not to. This
created unserved or underserved populations and
the first attempts to provide universal
education.
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1817 New Jersey creates The State School Fund
to help educate "poor children
By 1820 13 of the 23 states have constitutional
provisions concerning education

• 1828 New Jersey conducts a study on the
  Condition of Education which reveals
• Many children are still unable to attend school
• One in every five voters is unable to read or
  write
• State residents want a free public school system.

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1846
THE GREAT COMMON SCHOOLS LAW
New Jerseys first comprehensive attempt to get
all children a basic education

• Provided limited state and local funds for the
  operation of schools
• Prohibited spending school funds for purposes
  other than education
• Permitted local school districts to appoint
  superintendents
• Established a state board of education
• Created a state superintendent of public
  instruction
• Required schools to be free to all children aged
  5 to 18

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1838 NEWARK Barringer High
School is the third high school established in
the United States
1857 PLAINFIELD Plainfield
High School is the second high school established
in New Jersey
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HENRY BARNARD Appointed secretary (1837) of the
newly created board of education of
Massachusetts. In this position he held teachers'
conventions, delivered lectures and addresses,
carried on an extensive correspondence, and
introduced numerous reforms. He persuaded many of
the practical benefits of a common school
education to the individual and to the state.
HORACE MANN Led the education departments in
Connecticut Rhode Island was first U.S.
commissioner of education (1867). Edited the
American Journal of Education, thirty-one volumes
of information on the subject of common school
education.
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1853
The New Jersey Education Association was founded
in 1853 by a group of educators with a desire to
improve public education and elevate the teaching
profession. The organization now represents
200,000 New Jersey public school employees,
including active and retired teachers and
educational support professionals, as well as
county college faculty.
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1870 - 1970 The Pursuit of Equal Protection
Equity
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The Legislature shall provide for the maintenance
and support of a thorough and efficient system of
free public schools for the instruction of all
children in the state between the ages of five
and eighteen years.
New Jersey Constitution, as amended effective
September 28, 1875
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To carry out that mandate New Jersey established
school district boundaries contiguous with
municipal boundaries creating districts with
widely varying levels of wealth and large
differences in their ability to pay for schools
RIDGEWOOD Property Value/Pupil
1,223,853 Income/Pupil
355,362
2 0 0 8
NEWARK Property Value/Pupil
383,968 Income/Pupil
59,379
MILLBURN Property Value/Pupil
1,832,101 Income/Pupil
642,235
NEW JERSEY Property Value/Pupil
977,893 Income/Pupil 190,499
DEAL Property Value/Pupil 85,543,442 Income/
Pupil 3,385,038
TOMS RIVER Property Value/Pupil
1,121,508 Income/Pupil
167,347
CAMDEN Property Value/Pupil
82,850 Income/Pupil 34,321

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• All school districts were Type I
• Board of education appointed
• Budget determined by board of school estimate
• Most soon became Type II
• Board of education elected
• Budget (tax levy) approved or defeated in
  election

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• 1871 State school tax 23 cents/100

• State school aid flat grant of 3/pupil

1892 Plessy v. Ferguson
1909 Teacher tenure
1919 Minimum teacher salary law (1800)
1919 Teacher Pension Annuity Fund
1920 State aid 16.5 of local school costs
1940 State aid 30 of local school costs

Toms River School Budget 100,000
1948 Toms River school budget 365,000

Manchester School Budget 27,000
1954 Brown v. Board of Education
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1946 Pascoe State Aid Law

• Foundation Program provides districts with 200
  per pupil less (local fair share) proceeds of
  .01 per 100 of equalized valuation tax rate
• 50 minimum per pupil

Millburn Foundation
100 students x 200
20,000 Local Fair
Share Equalized valuation 20,000,000

20,000,000 / 100 x .01
20,000 Aid entitlement
20,000 - 20,000
0 Aid

5,000
Camden Foundation 100
students x 200 20,000
Local Fair Share
Equalized valuation 3,000,000

3,000,000 / 100 x .01
3,000 Aid entitlement 20,000 - 3000
17,000 Aid

17,000
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1954 Dumont State Aid Law

• Equalization Program provides districts with the
  difference between their tax base and state
  guaranteed tax base
• 50 minimum per pupil

Millburn Budget
1,000,000 State guaranteed tax base
per pupil 20,000
State guaranteed tax base (20,000 x
100) 2,000,000
Millburn equalized valuations
4,000,000 Ratio of actual to guaranteed
to valuations 200 Aid
entitlement

0 Aid

5,000
Camden Budget 1,000,000
State guaranteed tax base per pupil
20,000
State guaranteed tax base (20,000 x 100)
2,000,000
Camden equalized valuations
300,000 Ratio of actual to guaranteed to
valuations 15 Aid
entitlement

847,500 Aid

847,500
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1966 Beadleston State Aid Law

• Provided districts with additional categorical
  aid to be used for special programs for
  handicapped students.
• Categorical Aid now includes aid for
• Extraordinary special education costs (40,000)
• Student transportation (2-2.5 miles)
• At Risk students (Free reduced price lunch)
• LEP (Limited English Proficiency)
• Security (70 - 406)

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The 1970 Dilemma!State aid is 28 but
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1870 - 1970 The Pursuit of Parity and Adequacy
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HAROLD RUVOLDT (Re)DISCOVERS T E

• 1970 Robinson v. Cahill Ruvoldt files lawsuit on
  behalf of urban schoolchildren charging the state
  system of funding education discriminates against
  poor districts and creates disparities in
  education
• 1971 Serrano v. Priest overturned California's
  method of support of public schools because, the
  state Supreme Court said, "the quality of a
  child's education depended upon the resources of
  the school district and ultimately on the
  pocketbook of his parents
• 1973 N.J. Supreme Court New Jersey's system of
  school finance is unconstitutional because it
  discriminates against poor districts
• 1975 Public School Education Act (Chap 212) (T
  E Law) creates new state funding formula but
  legislature does not raise money to fund it
• 1976 Supreme Court closes New Jersey schools
  Under pressure, Legislature enacts income tax (2
  - 2.5) - Chap 212 goes into effect

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Heres howThe Public School Education Act (Ch
212) worked
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The EDUCATION LAW CENTER Joins the Fight

• 1981 Education Law Center (Marilyn Morehouser)
  files "Abbott v. Burke" saying the 1975 law is
  inadequate to provide a TE education The ELC
  challenge then spends nine years working its way
  through the courts
• 1985 Abbott I Supreme Court remands to the
  Office of Administrative Law saying State must
  assure urban children an education as good as
  their suburban peers
• 1988 Administrative Law Judge Steven LeFelt , in
  a 600 page decision, finds for plaintiff children
  and recommends a complete overhaul of New
  Jersey's system of providing urban education
• 1989 Education Commissioner Saul Cooperman
  rejects Judge LeFelt's decision and defends
  existing system as adequate
• 1990 Governor Jim Florio introduces the Quality
  Education Act (QEA) and a 2.8 billion tax
  increase to fund it. Tax increase costs Florio
  reelection

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Heres howThe Quality Education Act
worked
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The PRESSURE CONTINUES

• 1992 Abbott II Supreme Court requires State to
  equalize funding between urban and suburban
  districts and provide supplemental programs to
  wipe out disadvantages
• 1994 Abbott III Supreme Court declares QEA
  unconstitutional because it does not equalize
  funding or guarantee supplemental programs. Gives
  New Jersey until 1997 to fully comply
• 1996 Gov. Christie Whitman proposes solving the
  dilemma by capping spending in wealthy districts

Instead, legislature passes the Comprehensive
Education Improvement and Financing Act (CEIFA)
which institutes an adequacy based plan Defines
the Core Curriculum Content Standards that must
be provided in a TE education, establishes a
base cost per pupil to deliver those standards,
calculates a local fair share based on income
property value, then adds categorical aids.
See how this attempted solution worked!
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Heres howThe Comprehensive Education
Improvement Finance Act (CEIFA)
worked
And we lived with this, through continuing
challenges, until last year!
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The PRESSURE CONTINUES

• 1997 Abbott IV Supreme Court declares CEIFA
  unconstitutional and orders State to increase
  funding to urban districts to parity with
  suburban schools
• 1998 Abbott V Supreme Court orders State to
  provide urban schools with full-day preschool
  kindergarten, whole school reform, full-funded
  facility repairs and replacement, security,
  technology, after-school and summer programs
• 2000 Abbott VI Supreme Court orders State to
  overhaul preschool program, Abbott VII reaffirms
  State's obligation to pay all costs of facility
  repair and construction in Abbott districts
  (Schools Construction Corporation spends 8.6
  billion, SDA gets 3.9 billion more)
• 2002 Abbott VIII Supreme Court clarifies
  requirements for state-funded preschool programs
• 2002 Abbott IX Supreme Court institutes a
  one-year freeze on Abbott remedies
• 2004 Abbott X Supreme Court establishes the
  Cooperative Rulemaking Group to develop new
  Abbott regulations. SDOE accepts most of the new
  regulations but state aid remains frozen until
  2008

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2008 School Funding Reform Act A New Formula for
Success All Children, All Communities (SFRA)
Governor convinces legislature to approve a
radical new funding formula during "lame duck"
session.
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The School Funding Reform Act

• "Adequacy" budget
• Base Cost 9,500 for an elementary school
  student 9,978 for a middle school student and
  11,118 for a high school student,
• Other Components Additional costs of
  handicapped, LEP, and at-risk children

Local fair share what district tax base can
afford, using property values and income Local
Fair Share 46.5 cents per 100 of equalized
valuation and 2.3 cents per dollar of aggregate
income
Categorical aid for state mandated services
including transportation, special education, and
school security
Guarantee During the first year, no district's
state aid was reduced, all districts received a
minimum 2 increase, increases in state aid were
capped at 20 if spending less than adequacy
budget, 10 if more
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Results ofThe School Funding Reform Act