Bill Text: NJ A942 | 2024-2025 | Regular Session | Introduced
Bill Title: Requires five-year average of equalized property valuation be used in calculation of local share under State school funding formula.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced) 2024-03-11 - Reported and Referred to Assembly Appropriations Committee [A942 Detail]
Download: New_Jersey-2024-A942-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblyman ROY FREIMAN
District 16 (Hunterdon, Mercer, Middlesex and Somerset)
SYNOPSIS
Requires five-year average of equalized property valuation be used in calculation of local share under State school funding formula.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning State school aid and amending P.L.2007, c.260 (C.18A:7F-43 et al.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 10 of P.L.2007, c.260 (C.18A:7F-52) is amended to read as follows:
10. Each school district and county vocational school district shall receive equalization aid predicated on a local share determined by district property wealth and district income.
a. Each district's local share shall be calculated as follows:
LSHARE = (EQVAL x PVR x 50%) + (INC x INR x 50%)
where
EQVAL is the average of the district's [prebudget year] equalized valuation amounts for the preceding five school years;
PVR is the Statewide property value rate determined pursuant to subsection c. of this section;
INC is the district's income; and
INR is the Statewide income rate determined pursuant to subsection c. of this section.
b. The local share for each county vocational school district shall be calculated as follows:
LSHARE = (COLSHARE/COAB) x AB
where
COLSHARE is the sum of the local shares for all school districts in the county calculated pursuant to subsection a. of this section;
COAB is the sum of the adequacy budgets for all school districts in the county calculated pursuant to section 9 of [this act] P.L.2007, c.260 (C.18A:7F-51); and
AB is the county vocational school district's adequacy budget calculated pursuant to section 9 of [this act] P.L.2007, c.260 (C.18A:7F-51).
c. For the 2008-2009 school year, the property value rate shall be set at 0.0092690802 and the income value rate shall be set at 0.04546684. For subsequent school years the values for the property value rate and the income value rate shall be annually determined by the commissioner as follows:
the property value rate shall be determined such that equalization aid equals the Statewide available equalization aid for all districts determined according to [this act] P.L.2007, c.260 (C.18A:7F-43 et al.) had each school district's local share equaled the product of the property value rate and the district's five-year average equalized valuation and each county vocational school district's local share equaled the product of the county vocational school district's adequacy budget and the average local share, expressed as a percent, of the school districts located in the county; and
the income rate shall be determined such that equalization aid equals the Statewide available equalization aid for all districts determined according to [this act] P.L.2007, c.260 (C.18A:7F-43 et al.) had each school district's local share equaled the product of the income rate and the district's income and each county vocational school district's local share equaled the product of the county vocational school district's adequacy budget and the average local share, expressed as a percent, of the school districts located in the county.
In the event that these rates, when used in accordance with the provisions of this section and assuming that each district's general fund levy is equal to its local share, do not result in equalization aid for all districts equal to the Statewide available equalization aid, the commissioner shall adjust these rates appropriately, giving equal weight to each.
(cf: P.L.2007, c.260, s.10)
2. This act shall take effect immediately and shall first affect State school aid calculations for the 2024-2025 school year.
STATEMENT
This bill makes changes to the calculation of a school district's local share in determining the district's State school aid.
Under current law, a district's local share is calculated by multiplying the district's prebudget year equalized valuation by the Statewide property value rate, divided by two, and adding this to the product of the district's income and the Statewide income rate, divided by two.
This bill amends the calculation to use the district's average equalized valuation over the preceding five school years instead of the district's prebudget year equalized valuation.
