A bout 30 school districts throughout New Jersey could get the option to bank their federal impact aid funding in the future if a recently proposed piece of legislation in the state Assembly becomes law .
Written by Assemblyman Ronald Dancer (R-Monmouth, Ocean, Middlesex, Burlington), the bill would allow for the creation of a special account to hold the funds for the sole purpose of educating the children of military families.
“New Jersey will set a national example by committing to use these funds for what they are intended — educating the children of our brave men and women in the armed forces,” Dancer said in a press release. A little more than $18.2 million in federal impact aid was awarded to 27 school districts throughout New Jersey during fiscal year 2011.
According to the U.S. Department of Education, impact aid is awarded to school districts for several reasons.
School districts where the federal government owns a large amount of land, such as the Plumsted Township School District, receive their federal funding as a Section 8002 funding district.
In 2011, Plumsted was awarded $861,975 in federal impact aid. Approximately 20 square miles — about half the township — is part of the federal Joint Air Base McGuire-Dix-Lakehurst. School districts where a portion of the student body lives in federal housing (i.e., military bases and Native American reservations), such as Burlington County’s North Hanover Township School District, are designated as Section 8003(b) districts.
In 2011, North Hanover received $10 million in federal impact aid, according to Dancer.
Other school districts that received federal impact aid included the Colts Neck School District ($624,663), the Eatontown School District ($218,493), the Long Branch School District ($22,370), the Mon- mouth Regional School District ($77,660) and the Tinton Falls School District ($119,174).
In all instances, the school districts do not receive local property taxes on the land that is owned by the federal government. The government provides impact aid funding to the school district to offset the loss in revenue, according to the press release.
“This (proposed legislation) will benefit property taxpayers and communities that host military bases,” Dancer said.
Dancer, who serves as Plumsted’s municipal business administrator in addition to his position as the township’s Assembly representative, said the proposed legislation also prevents the state from reducing its state aid to a school district because of the amount of federal aid a school district receives.
Due to state legislation, school districts are also limited in how much surplus funds they can keep on hand.
“I was encouraged [by New Jersey Department of Education Assistant Commissioner of Administration and Finance] David Corso to move forward with this legislation because you need statutory authority to establish these reserve accounts,” Dancer said.
In recent months, school administrators have also had to worry about the very existence of federal impact aid in the upcoming years, as mandated budget adjustments have made some politicians rethink the policy that provides aid to school districts where the federal government owns land.
In his 2013 budget, President Barack Obama proposed the elimination of impact aid for Section 8002 districts.
Such a suggestion had Plumsted administrators fearing for the worst, estimating they would only have 18 months’ worth of available funds if they lost that assistance.
Dancer said he believes his bill will send a clear message to Congress that there are enough school districts in New Jersey that rely on the federal funding.
“If this isn’t [put in place], it could result in draconian cuts … that would be tragic,” he said. “We want to do anything we can to help school districts across the state and, in turn, help local taxpayers.”