The most obvious would be to postpone the next school-aid payment to July. The state already defers the final two payments of the school year into the next fiscal year, a practice started under former Gov. Jim McGreevey to help solve his own budget crunch. This move would add a third deferred payment. The payment, amounting to about $400 million, is slated to go out May 22.
But even if the state could pull back at this point, the impact may be felt more in cash flow than in real hardship, as most districts have in the past either tapped into surplus to keep paying the bills or entered into short-term borrowing , with the state then helping to defray those borrowing costs.
More significant would be eliminating one of the aid payments altogether, amounting to essentially a 5 percent cut in aid.
Other options might include reductions in specific aid categories, such as special-aid costs or aid for districts experiencing big enrollment growth.
Labels: DOE, school funding