Once upon a time, New Jersey funded its public schools in a manner as easy to understand as your child’s ABCs. Local districts developed annual budgets and used property taxes to pay for it all. Over the years, however, advocates for economically disadvantaged children began to argue that this simple system of paying for schools created inequities, as impoverished towns, lacking a robust tax base, were unable to raise the money needed for good schools. In 1976, the NJ legislature imposed a state income tax to compensate for school funding inequities, but disparities were still everywhere.

These days, New Jersey is celebrated throughout the country for its progressive, and generous, school funding system. In 2014, for example, the state allocated $9 billion in direct aid to public schools, more than a quarter of its total budget. On average, NJ spends a combined total of about $18,000 per pupil per year, which is one of the highest rates in the country.

But where exactly does that money come from and where does it go?

New Jersey’s Constitution requires that each public school student have access to “a thorough and efficient education system.” Back in the 1970s, in the wake of federal civil rights reform, an organization called Education Law Center (ELC) started arguing that New Jersey’s “zip code education funding,” in which funding per pupil was directly tied to a town’s property taxes and therefore wealth, was discriminatory.

In 1981, ELC took their case to court. The landmark Abbott v. Burke rulings (the case was named for Ray Abbott, a 12-year-old Camden student who appeared first on the alphabetical list of 19 plaintiffs) dramatically changed NJ’s school funding structure. ELC proved that wealthy districts were, in some cases, spending twice as much per pupil each year as poor districts. In response, the NJ Supreme Court designated 31 of our school districts “Abbott Districts” and ordered the state to fund their students at the same or greater amount as students in NJ’s wealthiest districts.

Over the lengthy litigation—there are currently 21 Abbott districts, with more likely on the way—the Court ruled that NJ must provide free preschools for 3 and 4 year olds who reside in these towns, as well as other services to compensate for the academic burdens of poverty. To this day, much of NJ’s school aid is directed to Abbott districts, in spite of multiple legislative efforts (like the School Funding Reform Act) intended to replace this method of state allocations.

Abbot Districts

What does this mean for you?

If you live in a relatively wealthy town, it means that most of your school district’s annual operating budget is raised through property taxes, just like in the olden days. In fact, you’re going to make one of your quarterly payments this month (February 1). If you live in a poor city, it means most of your school’s annual budget comes from state and federal aid.

For example, Camden County’s wealthy Cherry Hill Public Schools District has an annual operating budget of $174,000,000. Of that total, about $152,500,000 is raised through local property taxes. The NJ Department of Education estimates the district’s annual cost per pupil at $13,322. A few miles away, Camden Public Schools, an Abbott district, has a total operating budget of about $327,000,000. This district’s entire budget comes from state and federal sources, and the annual cost per pupil is estimated at $21,726 (although it’s closer to $24,000).

In Mercer County, West Windsor-Plainsboro Public Schools has an annual operating budget of $172,000,000; $145,000,000 of that total is raised through local property taxes. In Trenton, an Abbott district, the annual operating budget is $267,000,000 and about $21,000,000 is raised through local property taxes. The annual cost per pupil in well-to-do West Windsor is $13,701, while the annual cost in impoverished Trenton is $17,145.

Estimate how much of the taxes you pay will go to education in your town by looking at your property tax bill; typically, more than half of your check will go to local public schools. To see how your district funding breaks down, click here

How do schools spend that money?

Education is a people-rich enterprise, and typically 70–80 percent of a district’s annual operating budget (sometimes more) gets allocated to payroll and benefits. For example, Montclair Public Schools in Essex County has an average cost per pupil of $15,257. Of that total, $13,064 goes to staff and administrator salaries and benefits. The rest of the money goes to transportation, energy, facilities maintenance, supplies and other non-personnel costs.

Unfortunately, NJ’s current economic trouble has undermined efforts to fully fund the School Funding Reform Act. And extra money clearly doesn’t solve all: Despite all that additional aid in Camden, student performance there is still well below Cherry Hill’s. Efforts to integrate school districts, which some experts regard as necessary for educational equity, have failed to catch on in a state known for its worship of local control. Some Abbott districts use their aid effectively while others don’t, and poor-but-not-quite-Abbott districts struggle to meet student needs without increased state funds. New Jersey residents squeal when they get their property tax bills, and districts struggle to function under the legislatively mandated 2-percent cap on school tax increases. ELC continues to fight for more resources, and NJ’s economically disadvantaged students continue to fall behind.

Laura Waters is an NJ school board member and author of the blog NJ Left Behind. The views expressed here are her own.

More Like This: 
How Much Does Your District Spend on Each Student?
Gifted and Talented Programming in NJ
Struggling In School