Determining the Cost of Education in New Jersey

NJ Department of EducationPresentation before the Joint

Legislative Committee on Public School Funding Reform

October 24, 2006

1

Background

DOE decided that there was a need to explore new school funding formula

Entered contract with Augenblick, Palaich and Associates (formerly Augenblick & Myers) in 2002

Chose to use two methods to estimate the cost of education

2

Successful School Districts (SSD)

Establish measurable criteria by which districts are deemed successful

Identify districts that meet that criteria Calculate general education

expenditures for districts meeting that criteria

Method should not be used to determine costs of students with special needs

3

Professional Judgment Panels (PJP)

Develop educational goals Construct prototype school districts Have education professionals identify

resources needed to meet educational goals Determine the cost of specified resources Apply costs to all school districts and

calculate weights for special needs students

4

Outline of Discussion

Discussion of Dr. Augenblick’s work with DOE

Summary of final PJP resources Explanation of how cost of PJP

resources were determined Summary of Successful School Districts

analysis Questions

5

Role of Augenblick, Palaich and Associates

Assist DOE in the implementation of two methods for determining cost of education• Provide advice on implementing SSD method

• Facilitate PJP meetings

• Advise DOE personnel in calculating the cost of PJP resources

• Create formulas to calculate foundation amount for all districts and weights for special needs students

6

Five Steps of PJP Implementation

Determine student outcome goals Define prototype districts Convene panel meetings Provide DOE with resources for costing

purposes Translate resource costs into base cost

formulas and special needs weights

7

Step 1 – Determine Outcome Goals

NJ educational goals defined by DOE based on three factors• Core Curriculum Content Standards

• No Child Left Behind AYP requirements

• State specified graduation requirements

8

Step 2 – Define Prototype Districts Review data of school district demographics

• Size

• Student Characteristics Based on review, created six prototype districts

• Two K through 8

• Four K through 12 Allowed for varying rates of low-income and limited

English proficiency students Special education rates consistent across districts

9

Step 3 – Hold Panel Meetings

First meeting included seven DOE staff members

Second meeting included approximately 40 school district representatives divided across five panels

Third meeting included eight school district representatives

10

Brief Summary of PJP Resources

General Education Special Education Limited English Proficiency At-Risk Resources are not intended to be

prescriptive

11

Step 4 – Costing Out

Panel results given to NJ DOE DOE responsible for determining the

cost of PJP resources Provided advice on analytic decisions as

needed

12

Step 5 – Creating Base Cost Formulas and Student Weights

Six base per pupil costs translated into a series of equations used to determine base cost for each school district

Student weights calculated as the ratio of additional cost for special populations relative to base cost

13

Determining the Cost of PJP Resources

Personnel resources specified as FTEs• Certificated staff salaries determined by median salary

in certificated staff data

• Non-certificated staff salaries determined by median salaries in the State Occupational Employment and Wage Estimates (Bureau of Labor Statistics)

• Benefit rate equals 20 percent of salaries

Non-personnel resources recorded in different terms

14

Additional Cost Adjustments

School level PJP costs used to identify costs associated with grade spans not included in PJP process

Separate cost analysis conducted to identify additional cost of county vocational districts

15

Basic Education Costs in Prototype Districts

Very Small

K - 8

Small

K - 8

Small

K – 12

Mod.

K - 12

Large

K - 12

Very Large

K – 12

Base Cost

$10,057 $7,863 $8,775 $8,215 $8,136 $8,016

Adj. Base Cost

$8,460 $7,223

16

Special Needs Weights

K - 8 K – 12

Special Education

Speech Only 0.46 0.41

Mod. Impairment 1.95 1.45

Severe Impairment 7.39 4.28

Ext. School Year 0.48 0.43

Prek Disabled 3.18 2.80

At-Risk Education 0.63 0.44

LEP 0.81 0.37

17

Other District Adjustments

District Type Additional Weight

Grade K – 6 No additional weight

Grade 7 - 12 0.08

Grade 9 - 12 0.13

County Vocational 0.20

18

Geographic Cost of Education Index

Developed by Dr. Jay Chambers for NCES

Accounts for multiple factors that affect the cost of hiring comparably skilled professionals including:• Housing costs

• Work environment

19

Successful School Districts Analysis

Success criteria defined by student performance on Statewide assessments• Analysis limited to K – 8 and K – 12 districts

to allow for comparison to PJP results

• Alternative criteria that incorporated broader range of factors (e.g., attendance and dropout rates) did not substantially alter results

20

SSD Results

305 school districts identified as successful• 75 percent of K – 8 districts

• 64 percent of K – 12 districts

Per-pupil costs were consistent with PJP results• $8,004 for K – 8 districts, 9 percent higher than the

median PJP for K – 8 districts

• $8,493, almost identical to the median PJP for K – 12 districts