Eliminates use of census-based funding of special education aid in school funding law.

A1618

ASSEMBLY, No. 1618

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman SEAN T. KEAN

District 30 (Monmouth and Ocean)

Assemblywoman VICTORIA A. FLYNN

District 13 (Monmouth)

Co-Sponsored by:

Assemblywoman Fantasia

SYNOPSIS

���� Eliminates use of census-based funding of special
education aid in school funding law.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning State funding for special education and
amending P.L.1996, c.138 and P.L.2007, c.260.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 5 of P.L.1996,
c.138 (C.18A:7F-5) is amended to read as follows:

���� 5.��� As used in this section,
"cost of living" means the CPI as defined in section 3 of P.L.2007,
c.260 (C.18A:7F-45).

���� a.��� Within 30 days following
the approval of the Educational Adequacy Report, the commissioner shall notify
each district of the base per pupil amount, the per pupil amounts for full-day
preschool, the weights for grade level, county vocational school districts,
at-risk pupils, bilingual pupils, and combination pupils, the cost coefficients
for security aid and for transportation aid,
[
the
State average classification rate and
]

the excess cost for general special education services pupils,
[
the State
average classification rate and
]

the excess cost for speech-only pupils, and the geographic cost adjustment for
each of the school years to which the report is applicable.

���� Annually, within two days
following the transmittal of the State budget message to the Legislature by the
Governor pursuant to section 11 of P.L.1944, c.112 (C.52:27B-20), the
commissioner shall notify each district of the maximum amount of aid payable to
the district in the succeeding school year pursuant to the provisions of
P.L.2007, c.260 (C.18A:7F-43 et al.), and shall notify each district of the
district's adequacy budget for the succeeding school year.

���� For the 2008-2009 school year
and thereafter, unless otherwise specified within P.L.2007, c.260 (C.18A:7F-43
et al.), aid amounts payable for the budget year shall be based on budget year
pupil counts, which shall be projected by the commissioner using data from
prior years.� Adjustments for the actual pupil counts of the budget year shall
be made to State aid amounts payable during the school year succeeding the
budget year.� Additional amounts payable shall be reflected as revenue and an
account receivable for the budget year.

���� Notwithstanding any other
provision of this act to the contrary, each district's State aid payable for
the 2008-2009 school year, with the exception of aid for school facilities
projects, shall be based on simulations employing the various formulas and State
aid amounts contained in P.L.2007, c.260 (C.18A:7F-43 et al.). The commissioner
shall prepare a report dated December 12, 2007 reflecting the State aid amounts
payable by category for each district and shall submit the report to the
Legislature prior to the adoption of P.L.2007, c.260 (C.18A:7F-43 et al.).�
Except as otherwise provided pursuant to this subsection and paragraph (3) of
subsection d. of section 5 of P.L.2007, c.260 (C.18A:7F-47), the amounts
contained in the commissioner's report shall be the final amounts payable and
shall not be subsequently adjusted other than to reflect the phase-in of the
required general fund local levy pursuant to paragraph (4) of subsection b. of
section 16 of P.L.2007, c.260 (C.18A:7F-58) and to reflect school choice aid to
which a district may be entitled pursuant to section 20 of that act. The
projected pupil counts and equalized valuations used for the calculation of
State aid shall also be used for the calculation of adequacy budget, local
share, and required local share.� For 2008-2009, extraordinary special
education State aid shall be included as a projected amount in the
commissioner's report dated December 12, 2007 pending the final approval of
applications for the aid.� If the actual award of extraordinary special
education State aid is greater than the projected amount, the district shall
receive the increase in the aid payable in the subsequent school year pursuant
to the provisions of subsection c. of section 13 of P.L.2007, c.260
(C.18A:7F-55). If the actual award of extraordinary special education State aid
is less than the projected amount, other State aid categories shall be adjusted
accordingly so that the district shall not receive less State aid than as
provided in accordance with the provisions of sections 5 and 16 of P.L.2007,
c.260 (C.18A:7F-47 and C.18A:7F-58).

���� In the event that the
commissioner determines, following the enactment of P.L.2007, c.260
(C.18A:7F-43 et al.) but prior to the issuance of State aid notices for the
2008-2009 school year, that a significant district-specific change in data
warrants an increase in State aid for that district, the commissioner may
adjust the State aid amount provided for the district in the December 12, 2007
report to reflect the increase.

���� b.��� Each district shall have
a required local share.� For districts that receive educational adequacy aid
pursuant to subsection b. of section 16 of P.L.2007, c.260 (C.18A:7F-58), the
required local share shall be calculated in accordance with the provisions of
that subsection.

���� For all other districts, the
required local share shall equal the lesser of the local share calculated at
the district's adequacy budget pursuant to section 9 of P.L.2007, c.260
(C.18A:7F-51), or the district's budgeted local share for the prebudget year.

���� In order to meet this
requirement, each district shall raise a general fund tax levy which equals its
required local share.

���� No municipal governing body or
bodies or board of school estimate, as appropriate, shall certify a general
fund tax levy which does not meet the required local share provisions of this
section.

���� c.��� Annually, on or before
March 4, or on or before March 20 in the case of a school district with an
annual school election in November, each district board of education shall
adopt, and submit to the commissioner for approval, together with such
supporting documentation as the commissioner may prescribe, a budget that
provides for a thorough and efficient education. Notwithstanding the provisions
of this subsection to the contrary, the commissioner may adjust the date for
the submission of district budgets if the commissioner determines that the
availability of preliminary aid numbers for the subsequent school year warrants
such adjustment.

���� Notwithstanding any provision
of this section to the contrary, for the 2005-2006 school year each district
board of education shall submit a proposed budget in which the advertised per
pupil administrative costs do not exceed the lower of the following:

���� (1)� the district's advertised
per pupil administrative costs for the 2004-2005 school year inflated by the
cost of living or 2.5 percent, whichever is greater; or

���� (2)� the per pupil
administrative cost limits for the district's region as determined by the
commissioner based on audited expenditures for the 2003-2004 school year.

���� The executive county
superintendent of schools may disapprove the school district's 2005-2006
proposed budget if he determines that the district has not implemented all
potential efficiencies in the administrative operations of the district.� The
executive county superintendent shall work with each school district in the
county during the 2004-2005 school year to identify administrative
inefficiencies in the operations of the district that might cause the
superintendent to reject the district's proposed 2005-2006 school year budget.

���� For the 2006-2007 school year
and each school year thereafter, each district board of education shall submit
a proposed budget in which the advertised per pupil administrative costs do not
exceed the lower of the following:

���� (1)� the district's prior year
per pupil administrative costs; except that the district may submit a request
to the commissioner for approval to exceed the district's prior year per pupil
administrative costs due to increases in enrollment, administrative positions
necessary as a result of mandated programs, administrative vacancies,
nondiscretionary fixed costs, and such other items as defined in accordance
with regulations adopted pursuant to section 7 of P.L.2004, c.73.� In the event
that the commissioner approves a district's request to exceed its prior year
per pupil administrative costs, the increase authorized by the commissioner
shall not exceed the cost of living or 2.5 percent, whichever is greater; or

���� (2)� the prior year per pupil
administrative cost limits for the district's region inflated by the cost of
living or 2.5 percent, whichever is greater.

���� d.��� (1)� A district's
general fund tax levy shall not exceed the district's adjusted tax levy as
calculated pursuant to sections 3 and 4 of P.L.2007, c.62 (C.18A:7F-38 and
18A:7F-39).

���� (2)� (Deleted by amendment,
P.L.2007, c.260).

���� (3)� (Deleted by amendment,
P.L.2007, c.260).

���� (4)� Any debt service payment
made by a school district during the budget year shall not be included in the
calculation of the district's adjusted tax levy.

���� (5)� (Deleted by amendment,
P.L.2007, c.260).

���� (6)� (Deleted by amendment,
P.L.2007, c.260).

���� (7)� (Deleted by amendment,
P.L.2004, c.73).

���� (8)� (Deleted by amendment,
P.L.2010, c.44)

���� (9)� Any district may submit
at the annual school budget election, in accordance with subsection c. of
section 4 of P.L.2007, c.62 (C.18A:7F-39), a separate proposal or proposals for
additional funds, including interpretive statements, specifically identifying
the program purposes for which the proposed funds shall be used, to the voters,
who may, by voter approval, authorize the raising of an additional general fund
tax levy for such purposes.� In the case of a district with a board of school
estimate, one proposal for the additional spending shall be submitted to the
board of school estimate. Any proposal or proposals submitted to the voters or
the board of school estimate shall not: include any programs and services that
were included in the district's prebudget year net budget unless the proposal
is approved by the commissioner upon submission by the district of sufficient
reason for an exemption to this requirement; or include any new programs and
services necessary for students to achieve the thoroughness standards
established pursuant to subsection a. of section 4 of P.L.2007, c.260
(C.18A:7F-46).

���� The executive county
superintendent of schools may prohibit the submission of a separate proposal or
proposals to the voters or board of school estimate if he determines that the
district has not implemented all potential efficiencies in the administrative
operations of the district, which efficiencies would eliminate the need for the
raising of an additional general fund tax levy.

���� (10) Notwithstanding any
provision of law to the contrary, if a district proposes a budget with a
general fund tax levy and equalization aid which exceed the adequacy budget,
the following statement shall be published in the legal notice of public hearing
on the budget pursuant to N.J.S.18A:22-28, posted at the public hearing held on
the budget pursuant to N.J.S.18A:22-29, and printed on the sample ballot
required pursuant to section 10 of P.L.1995, c.278 (C.19:60-10):

���� "Your school district has
proposed programs and services in addition to the core curriculum content
standards adopted by the State Board of Education. Information on this budget
and the programs and services it provides is available from your local school
district."

���� (11)� Any reduction that may
be required to be made to programs and services included in a district's
prebudget year net budget in order for the district to limit the growth in its
budget between the prebudget and budget years by its tax levy growth limitation
as calculated pursuant to sections 3 and 4 of P.L.2007, c.62 (C.18A:7F-38 and
18A:7F-39), shall only include reductions to excessive administration or
programs and services that are inefficient or ineffective.

���� e.��� (1)� Any general fund
tax levy rejected by the voters for a proposed budget that includes a general
fund tax levy and equalization aid in excess of the adequacy budget shall be
submitted to the governing body of each of the municipalities included within
the district for determination of the amount that should be expended
notwithstanding voter rejection.� In the case of a district having a board of
school estimate, other than a Type II district with a board of school estimate
in which the annual election is in November, the general fund tax levy shall be
submitted to the board for determination of the amount that should be
expended.� If the governing body or bodies or board of school estimate, as
appropriate, reduce the district's proposed budget, the district may appeal any
of the reductions to the commissioner on the grounds that the reductions will
negatively impact on the stability of the district given the need for long term
planning and budgeting.� In considering the appeal, the commissioner shall consider
enrollment increases or decreases within the district; the history of voter
approval or rejection of district budgets; the impact on the local levy; and
whether the reductions will impact on the ability of the district to fulfill
its contractual obligations.� A district may not appeal any reductions on the
grounds that the amount is necessary for a thorough and efficient education.

���� (2)� Any general fund tax levy
rejected by the voters for a proposed budget that includes a general fund tax
levy and equalization aid at or below the adequacy budget shall be submitted to
the governing body of each of the municipalities included within the district
for determination of the amount that should be expended notwithstanding voter
rejection.� In the case of a district having a board of school estimate, other
than a Type II district with a board of school estimate in which the annual
election is in November, the general fund tax levy shall be submitted to the
board for determination.� Any reductions may be appealed to the commissioner on
the grounds that the amount is necessary for a thorough and efficient education
or that the reductions will negatively impact on the stability of the district
given the need for long term planning and budgeting.� In considering the
appeal, the commissioner shall also consider the factors outlined in paragraph
(1) of this subsection.

���� In addition, the municipal
governing body or board of school estimate shall be required to demonstrate
clearly to the commissioner that the proposed budget reductions shall not
adversely affect the ability of the school district to provide a thorough and
efficient education or the stability of the district given the need for long
term planning and budgeting.

���� (3)� In lieu of any budget
reduction appeal provided for pursuant to paragraphs (1) and (2) of this
subsection, the State board may establish pursuant to the "Administrative
Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), an expedited budget
review process based on a district's application to the commissioner for an
order to restore a budget reduction.

���� (4)� When the voters,
municipal governing body or bodies, board of education in the case of a school
district in which the annual school election has been moved to November
pursuant to subsection a. of section 1 of P.L.2011, c.202 (C.19:60-1.1), or the
board of school estimate authorize the general fund tax levy, the district
shall submit the resulting budget to the commissioner within 15 days of the
authorization.

���� f.���� (Deleted by amendment,
P.L.2007, c.260).

���� g.��� (Deleted by amendment,
P.L.2007, c.260).

(cf: P.L.2013, c.280, s.1)

���� 2.��� Section 2 of P.L.2007,
c.260 (C.18A:7F-44) is amended to read as follows:

���� 2.��� The Legislature finds
and declares that:

���� a.��� The Constitution of the
State of New Jersey states that 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.� (N.J. Const. art. VIII, sec. 4, par.1).

���� b.��� The State, in addition
to any constitutional mandates, has a moral obligation to ensure that New
Jersey's children, wherever they reside, are provided the skills and knowledge
necessary to succeed.� Any school funding formula should provide resources in a
manner that optimizes the likelihood that children will receive an education
that will make them productive members of society.

���� c.��� Although the Supreme
Court of New Jersey has held that prior school funding statutes did not
establish a system of public education that was thorough and efficient as to
certain districts, the Court has consistently held that the Legislature has the
responsibility to substantively define what constitutes a thorough and
efficient system of education responsive to that constitutional requirement.

���� d.��� Every child in New
Jersey must have an opportunity for an education based on academic standards
that satisfy constitutional requirements regardless of where the child resides,
and public funds allocated to this purpose must be expended to support schools
that are thorough and efficient in delivering those educational standards.� In
turn, school districts must be assured the financial support necessary to
provide those constitutionally compelled educational standards.� Any school
funding formula should provide State aid for every school district based on the
characteristics of the student population and up-to-date measures of the
individual district's ability to pay.

���� e.��� New Jersey's current
public school funding formula, established under the provisions of the
"Comprehensive Educational Improvement and Financing Act of 1996,"
(CEIFA) P.L.1996, c.138, has not been used to calculate State aid for public
schools since the 2001-02 school year.� Any new school funding formula should
account for changes in enrollment and other significant developments, providing
relief to those districts that have experienced substantial enrollment
increases.

���� f.���� The decisions in the
Abbott cases have resulted in frequent litigation and a fragmented system of
funding under which limited resources cannot be distributed equitably to all
districts where at-risk children reside, instead dividing the districts sharply
into Abbott and non-Abbott categories for funding purposes without regard to a
district's particular pupil characteristics and leading to needlessly
adversarial relationships among school districts and between districts and the
State.�

���� g.��� In the absence of a
clear, unitary, enforceable statutory formula to govern appropriations for
education, crucial funding decisions are made annually, in competition for
limited State resources with other needs and requirements as part of the annual
budget negotiation process, utilizing many different classes and categories of
aid, leading to an uncertain, unpredictable, and untenable funding situation
for the State and school districts alike.�

���� h.��� This act represents the
culmination of five years of diligent efforts by both the Executive and
Legislative branches of State government to develop an equitable and
predictable way to distribute State aid that addresses the deficiencies found
in past formulas as identified by the Supreme Court.� Working together toward
this common goal, the Department of Education and the Legislature engaged
nationally recognized experts in education funding and provided significant
opportunities for stakeholder involvement and public input to assist in
formulating and refining a comprehensive school funding model that has been
validated by experts.� The formula accounts for the individual characteristics
of school districts and the realities of their surroundings, including the need
for additional resources to address the increased disadvantages created by high
concentrations of children at-risk.

���� i.���� The formula established
under this act is the product of a careful and deliberative process that first
involved determining the educational inputs necessary to provide a high-quality
education, including specifically addressing the supplemental needs of at-risk
students and those with limited English proficiency (LEP), and a determination
of the actual cost of providing those programs.� The formula provides adequate
funding that is realistically geared to the core curriculum content standards,
thus linking those standards to the actual funding needed to deliver that
content.

���� j.���� In recognition of the
unique problems and cost disadvantages faced by districts with high
concentrations of at-risk students, it is appropriate to reflect in the formula
a greater weight as the district's proportion of at-risk students increases.�
In addition, the new formula recognizes the disadvantages of an expanded group
of students by including in the definition of at-risk those students who
qualify for free or reduced-price lunch.� Expanding the definition of at-risk
students in this manner will significantly increase the resources flowing to
districts with high concentrations of these low-income students.

���� k.��� In light of the
demonstrable, beneficial results and success of the current Abbott preschool
program, it is appropriate to build upon this success by incorporating in the
formula an expanded high-quality preschool program for all children who qualify
for free and reduced price meals in all districts.� It is appropriate for the
formula to acknowledge that at-risk children do not always receive the same
educational exposure at an early age as their peers and to provide the
additional resources necessary through high-quality preschool to prepare every
child to learn and succeed.

���� l.���� It is appropriate to
reflect in this formula the inherent value of educating a child in the least
restrictive environment and, whenever possible, in that child's neighborhood
school alongside his peers.� The new funding formula should provide incentives for
keeping classified students in district.

���� m.�� It is also appropriate to
recognize in the formula the need for all schools to incorporate effective
security measures, which may vary from district to district depending upon the
at-risk student population and other factors, and to provide categorical funding
to address these important requirements.

���� n.���
[
In recognition
of the potentially wide variability in special education costs, even for the
same category of disability, from district to district, it is appropriate for
the new funding formula to mitigate the impact of that variability by
establishing a census model based on the actual Statewide average excess cost
of educating special education students and by providing for an increase in
State aid for extraordinary costs incurred by districts.
]

(Deleted
by amendment, P.L.��� , c.� ��) (pending before the Legislature as this bill)

���� o.��� It is imperative that
any new school funding formula work in conjunction with the key school
accountability measures that have been enacted in recent years to promote
greater oversight, transparency, and efficiency in the delivery of educational
services.� These accountability measures include the New Jersey Quality Single
Accountability Continuum, the "School District Fiscal Accountability
Act," P.L.2006, c.15 (C.18A:7A-54 et seq.), P.L.2007, c.63 (C.40A:65-1 et
al.) which established the duties and responsibilities of the executive county
superintendent of schools, and P.L.2007, c.53 (C.18A:55-3 et al.).

���� p.��� Together with a renewed
legislative focus on and commitment to providing sufficient means to maintain
and support a high-quality system of free public schools in the State, a new
funding formula supported by significantly increased State resources will ensure
compliance with all statutory and constitutional mandates.� Districts that were
formerly designated as Abbott districts will be provided sufficient resources
to continue those Court-identified programs, positions, and services that have
proven effective while being provided the flexibility to shift resources and
programmatic focus based on the needs of their students and current research.�

���� q.��� The time has come for
the State to resolve the question of the level of funding required to provide a
thorough and efficient system of education for all New Jersey school children.�
The development and implementation of an equitable and adequate school funding
formula will not only ensure that the State's students have access to a
constitutional education as defined by the core curriculum content standards,
but also may help to reduce property taxes and assist communities in planning
to meet their educational expenses.� The development of a predictable,
transparent school funding formula is essential for school districts to plan
effectively and deliver the quality education that our citizens expect and our
Constitution requires.

(cf: P.L.2007, c.260, s.2)

���� 3.��� Section 4 of P.L.2007,
c.260 (C.18A:7F-46) is amended to read as follows:

���� 4.��� a.� The State Board of
Education shall review and update the core curriculum content standards every
five years.� The standards shall ensure that all children are provided the
educational opportunity needed to equip them for the role of citizen and labor
market competitor.

���� The Commissioner of Education
shall develop and establish, through the report issued pursuant to subsection
b. of this section, efficiency standards which define the types of programs,
services, activities, and materials necessary to achieve a thorough and
efficient education.

���� b.��� By September 1 of 2010
and by September 1 every three years thereafter, the Governor, after
consultation with the commissioner, shall recommend to the Legislature through
the issuance of the Educational Adequacy Report for the three school years to
which the report is applicable:

���� (1)� the base per pupil amount
based upon the core curriculum content standards established pursuant to
subsection a. of this section;

���� (2)� the per pupil amounts for
full-day preschool;

���� (3)� the weights for grade
level, county vocational school districts, at-risk pupils, bilingual pupils,
and combination pupils;

���� (4)� the cost coefficients for
security aid and transportation aid;

���� (5)�
[
the State
average classification rate for general special education services pupils and
for speech-only pupils;
]

(Deleted by amendment, P.L.��� , c.�� )�� (pending before the Legislature as
this bill)

���� (6)� the excess cost for
general special education services pupils and for speech-only pupils; and

���� (7)� the extraordinary special
education aid thresholds.

���� The base per pupil amount, the
per pupil amounts for full-day preschool, the excess costs for general special
education services pupils and for speech-only pupils, and the cost-coefficients
for security aid and transportation aid shall be adjusted by the CPI for each
of the two school years following the first school year to which the report is
applicable.

���� The amounts shall be deemed
approved for the three successive fiscal years beginning from the subsequent
July 1, unless between the date of transmittal and the subsequent November 30,
the Legislature adopts a concurrent resolution stating that the Legislature is
not in agreement with all or any specific part of the report.� The concurrent
resolution shall advise the Governor of the Legislature's specific objections
to the report and shall direct the commissioner to submit to the Legislature a
revised report which responds to those objections by January 1.

(cf: P.L.2007, c.260, s.4)

���� 4.��� Section 9 of P.L.2007,
c.260 (C.18A:7F-51) is amended to read as follows:

���� 9.��� a.� The adequacy budget
for each school district and county vocational school district shall be
calculated as follows:

���� AB = (BC + AR Cost + LEP Cost
+ COMB Cost +
[
SE
Census
]
SE
Cost
) x GCA

where

���� BC is the district's or county
vocational school district's base cost as calculated pursuant to section 8 of
this act;

���� AR Cost is the cost of
providing educational and other services for at-risk pupils as calculated
pursuant to subsection b. of this section;

���� LEP Cost is the cost of
providing educational and other services for bilingual education pupils as
calculated pursuant to subsection c. of this section;

���� COMB Cost is the cost of
providing educational and other services for pupils who are both at-risk and
bilingual as calculated pursuant to subsection d. of this section;

����
[
SE Census
]

SE Cost

is the cost of providing programs and services to general special education
services pupils and speech-only pupils as calculated pursuant to subsection e.
of this section; and

���� GCA is geographic cost
adjustment.

���� The GCA shall be the
geographic cost adjustment developed by the commissioner and revised by the
commissioner every five years in accordance with receipt of census data.

���� b.��� AR Cost shall be
calculated as follows:

���� AR Cost = BPA x ARWENR x AR
Weight

where�

���� BPA is the base per pupil
amount;

���� ARWENR is the weighted
enrollment for at-risk pupils of the school district or county vocational
school district, which shall not include combination pupils; and

���� AR Weight is the at-risk
weight.

���� For the 2008-2009 through
2010-2011 school years the at-risk weight shall be as follows:

���� for a district in which the
concentration of at-risk pupils is less than 20% of resident enrollment, the
at-risk weight shall equal 0.47;

���� for a district in which the
concentration of at-risk pupils is equal to 20% but less than 60% of resident
enrollment, the at-risk weight shall equal the district's ((at-risk % - 0.20) x
0.25)) + 0.47; and

���� for a district in which the
concentration of at-risk pupils is equal to or greater than 60% of resident
enrollment, the at-risk weight shall equal 0.57.

���� For subsequent school years,
the AR weight shall be established in the Educational Adequacy Report.

���� c.��� LEP Cost shall be
calculated as follows:

���� LEP Cost = BPA x LWENR x LEP
Weight

where

���� BPA is the base per pupil
amount;

���� LWENR is the weighted
enrollment for the bilingual education pupils of the school district or county
vocational school district, which shall not include combination pupils; and

���� LEP Weight is the bilingual
pupil weight.

For the 2008-2009 through 2010-2011
school years the LEP weight shall be 0.5.� For subsequent school years, the LEP
weight shall be established in the Educational Adequacy Report.

���� d.��� COMB Cost shall be
calculated as follows:

���� COMB Cost = BPA x CWENR x (AR
Weight + COMB Weight)

where

���� BPA is the base per pupil
amount;

���� CWENR is the weighted
enrollment for pupils who are both at-risk and bilingual;

���� AR Weight is the at-risk
weight; and

���� COMB Weight is the combination
pupil weight.

���� For the 2008-2009 through
2010-2011 school years the COMB weight shall be 0.125.� For subsequent school
years, the COMB weight shall be established in the Educational Adequacy Report.

���� e.���
[
SE Census
]

SE Cost

shall be calculated as follows:

����
[
SE Census
]

SE Cost

= (
[
RE
x SEACR
]

SEENR
x AEC x 2/3) + (
[
RE
x SACR
]

SPEONLY
x SEC)

where

����
[
RE is the resident enrollment of
the school district or county vocational school district;

���� SEACR is the State average
classification rate for general special education services pupils
]

����
SEENR is the number of
general special education services pupils included in the school district�s or
county vocational school district�s resident enrollment
;

���� AEC is the excess cost for
general special education services pupils;

����
[
SACR is the State average
classification rate for speech-only pupils
]

����
SPEONLY is the number of
speech-only pupils included in the school district�s or county vocational
school district�s resident enrollment
; and

���� SEC is the excess cost for
speech-only pupils.

����
[
For the 2008-2009 through
2010-2011 school years the State average classification rate shall be 14.69%
for general special education services pupils and 1.897% for speech-only
pupils.� For subsequent school years, the State average classification rates shall
be established in the Educational Adequacy Report.
]

���� For the 2008-2009 school year
the excess cost shall be $10,898 for general special education services pupils
and $1,082 for speech-only pupils.� The excess cost amounts shall be adjusted
by the CPI in the 2009-2010 and 2010-2011 school years as required pursuant to
subsection b. of section 4 of this act.� For subsequent school years, the
excess cost amounts shall be established in the Educational Adequacy Report,
with the amounts adjusted by the CPI for each of the two school years following
the first school year to which the report is applicable.

(cf: P.L.2007, c.260, s.9)

���� 5.��� Section 13 of P.L.2007,
c.260 (C.18A:7F-55) is amended to read as follows:

���� 13.� a. Special education
categorical aid for each school district and county vocational school district
shall be calculated as follows:�

���� SE = (
[
RE x SEACR
]

SEENR

x AEC x 1/3) x GCA

where

����
[
RE is the resident enrollment of
the school district or county vocational school district;

���� SEACR is the State average
classification rate for general special education services pupils
]

����
SEENR is the number of
general special education services pupils included in the school district�s or
county vocational school district�s resident enrollment
;

���� AEC is the excess cost for
general special education services pupils; and

���� GCA is the geographic cost
adjustment as developed by the commissioner.

For the 2008-2009 school year the
excess cost shall be $10,898 for general special education services pupils.�
The excess cost amount shall be adjusted by the CPI in the 2009-2010 and
2010-2011 school years as required pursuant to subsection b. of section 4 of
this act.� For subsequent school years, the excess cost amount shall be
established in the Educational Adequacy Report, with the amount adjusted by the
CPI for each of the two school years following the first school year to which
the report is applicable.

���� b.��� Extraordinary special
education aid for an individual classified pupil shall be available when the
student is educated in a general education classroom, special education
program, including but not limited to a resource program or special class
program, or any combination of general education and special education programs
and services, subject to the requirements and thresholds set forth in this
section.

���� (1)� In those instances in
which a pupil is educated in an in-district public school program with
non-disabled peers, whether run by a public school or by a private school for
the disabled, and the cost of providing direct instructional and support
services for an individual classified pupil exceeds $40,000, for those direct
instructional and support services costs in excess of $40,000 a district shall
receive extraordinary special education State aid equal to 90% of the amount of
that excess in accordance with the provisions of paragraph (4) of this
subsection.

���� (2)� In those instances in
which a pupil is educated in a separate public school program for students with
disabilities and the cost of providing direct instructional and support
services for an individual classified pupil exceeds $40,000, for those direct
instructional and support services costs in excess of $40,000 a district shall
receive extraordinary special education State aid equal to 75% of the amount of
that excess in accordance with the provisions of paragraph (4) of this
subsection.

���� (3)� In those instances in
which a pupil is educated in a separate private school for students with
disabilities and the tuition for an individual classified pupil exceeds
$55,000, for tuition costs in excess of $55,000 a district shall receive
extraordinary special education State aid equal to 75% of the amount of that
excess in accordance with the provisions of paragraph (4) of this subsection.

���� (4)� Extraordinary special
education State aid for an individual classified pupil shall be calculated as
follows:

���� EA = ((ADC-$40,000) x .90) +
(((AIC - $40,000) +

(ASC - $55,000)) x .75)

where

���� ADC equals the district's
actual cost for the direct instructional and support services in an in-district
public school program as set forth in paragraph (1) of this subsection;

���� AIC equals the district's
actual cost for direct instructional and support services in a separate public
school program as set forth in paragraph (2) of this subsection; and

���� ASC equals the district's
actual cost for tuition paid to a separate private school as set forth in
paragraph (3) of this subsection.

���� (5)� The receipt of
extraordinary special education State aid for an individual classified pupil
shall be conditioned upon a demonstration by the district that the pupil's
Individualized Education Plan requires the provision of intensive services,
pursuant to factors determined by the commissioner.

���� c.��� In order to receive
funding pursuant to this section, a district shall file an application with the
department that details the expenses incurred on behalf of the particular
classified pupil for which the district is seeking reimbursement.� Additional
State aid awarded for extraordinary special education costs shall be recorded
by the district as revenue in the current school year and paid to the district
in the subsequent school year.

���� d.��� A school district may
apply to the commissioner to receive emergency special education aid for any
classified pupil who enrolls in the district prior to March of the budget year
and who is in a placement with a cost in excess of $40,000 or $55,000, as applicable.�
The commissioner may debit from the student's former district of residence any
special education aid which was paid to that district on behalf of the student.

���� e.��� The department shall
review expenditures of federal and State special education aid by a district in
every instance in which special education monitoring identifies a failure on
the part of the district to provide services consistent with a pupil's Individualized
Education Plan.

���� f.����
[
The
commissioner shall commission an independent study of the special education
census funding methodology to determine if adjustments in the special education
funding formulas are needed in future years to address the variations in
incidence of students with severe disabilities requiring high cost programs and
to make recommendations for any such adjustments.� The study and
recommendations shall be completed by June 30, 2010.
]

(Deleted by amendment,
P.L.��� , c.�� )�� (pending before the Legislature as this bill)

���� g.���
[
A school
district may apply to the commissioner to receive additional special education
categorical aid if the district has an unusually high rate of low-incidence
disabilities, such as autism, deaf/blindness, severe cognitive impairment, and
medically fragile.� In applying for the aid the district shall: demonstrate the
impact of the unusually high rate of low-incidence disabilities on the school
district budget and the extent to which the costs to the district are not
sufficiently addressed through special education aid and extraordinary special
education aid; and provide details of all special education expenditures,
including details on the use of federal funds to support those expenditures.
]

(Deleted
by amendment, P.L.��� , c.�� )�� (pending before the Legislature as this bill)

(cf: P.L.2007, c.260, s.13)

���� 6.��� This act shall take
effect immediately and shall first apply to the first full school year
following the date of enactment.

STATEMENT

���� Under the provisions of the
�School Funding Reform Act of 2008,� P.L.2007, c.260 (C.18A:7F-43 et al.), the
State provides special education aid to school districts using the census-based
method.� Under this method, districts receive funding for special education
based on the assumption that a fixed percent of the total student population
requires special education services, rather than using the actual number of
special education students to determine the amount of State aid that school
districts will receive.� This bill eliminates the use of the census-based
methodology, and calculates State aid for special education based on the actual
number of special education students included in the district�s resident
enrollment.